In this episode we answer emails from Deeps, David, James, Steven and Jordan. We discuss the PHYS vs other gold ETFs, the podcast feed link, using AVGE in a risk parity style portfolio, why we do this and tail risk hedging.
And THEN we our go through our weekly portfolio reviews of the eight sample portfolios you can find at Portfolios | Risk Parity Radio.
Additional links:
PHYS vs. GLDM: testfol.io/analysis?s=1lK9VB9xqaM
RPR Main Feed Link (all the podcasts -- open in browser): Risk Parity Radio RSS Feed
AVGE Composition And Other Info: AVGE – Portfolio – Avantis All Equity Markets ETF | Morningstar
Portfolio Matrix: Portfolio Matrix – Portfolio Charts
CAOS Fund: CAOS – Alpha Architect Tail Risk ETF – ETF Stock Quote | Morningstar
Amusing Unedited AI-Bot Summary:
Gold continues to shine while stocks falter in 2024's challenging market environment. This episode demonstrates the power of diversification during turbulent times, with precious metals up over 17% year-to-date as the S&P 500 struggles down nearly 5%. We explore why truly diversified portfolios are proving their worth yet again.
Responding to a listener question about gold ETFs, I break down why PHYS's potential tax advantages rarely outweigh its higher expense ratio compared to traditional options like GLD. The physical gold redemption feature sounds appealing but offers little practical benefit for most investors. The entire physical gold storage industry largely profits from fear rather than delivering substantive advantages to everyday investors.
The highlight of this episode comes from a fascinating listener discovery – combining the comprehensive Avantis AVGE fund with treasuries and gold creates a remarkably simple yet effective portfolio. This approach addresses a critical concern: ensuring surviving spouses can easily manage investments without sacrificing performance. Our analysis using Portfolio Charts shows this simplified approach delivers comparable results to more complex allocations while dramatically reducing management complexity.
We also tackle tail risk hedging strategies, explaining why these insurance-like approaches rarely justify their ongoing costs, especially for investors in the accumulation phase. True diversification provides more reliable protection than specialized instruments designed to profit from market crashes.
The portfolio performance review tells the real story – while traditional stock allocations struggle, our diversified sample portfolios are mostly holding steady or positive for the year. Historical patterns suggest diversified portfolios experience down years only about 20% of the time versus 30% for traditional approaches – a meaningful difference that compounds over retirement timeframes.
Have questions about navigating today's challenging markets? Send them to frank@riskparityradio.com – I'd love to answer them in an upcoming episode!
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Mary and Voices (00:01):
A foolish consistency, is the hobgoblin of
little minds, adored by littlestatesmen and philosophers and
divines.
Mostly Uncle Frank (00:10):
If a man does not keep pace with his
companions, perhaps it isbecause he hears a different
drummer, a different drummer.
Mary and Voices (00:19):
And now, coming to you from dead center on your
dial, welcome to Risk ParityRadio, where we explore
alternatives and assetallocations for the
do-it-yourself investor,broadcasting to you now from the
comfort of his easy chair.
Here is your host, frankVasquez.
Mostly Uncle Frank (00:37):
Thank you, Mary, and welcome to Risk Parity
Radio.
If you are new here and wonderwhat we are talking about, you
may wish to go back and listento some of the foundational
episodes for this program.
Voices (00:49):
Yeah, baby, yeah.
Mostly Uncle Frank (00:51):
And the basic foundational episodes are
episodes 1, 3, 5, 7, and 9.
Some of our listeners,including Karen and Chris, have
identified additional episodesthat you may consider
foundational, and those areepisodes 12, 14, 16, 19, 21, 56,
(01:13):
82, and 184.
Whoa, and you probably shouldcheck those out too, because we
have the finest podcast audienceavailable.
Mary and Voices (01:26):
Top drawer, really top drawer.
Mostly Uncle Frank (01:30):
Along with a host named after a hot dog.
Voices (01:34):
Lighten up Francis.
Mostly Uncle Frank (01:37):
But now onward, episode 410.
Today, on Risk Parity Radio,it's time for our weekly
portfolio reviews.
Of the eight sample portfoliosyou can find at
wwwriskparityradiocom on theportfolios page.
Mary and Voices (01:53):
This is gold, Mr.
Voices (01:54):
Bond, I think you've made your point.
Goldfinger, thank you for thedemonstration.
Mostly Uncle Frank (02:01):
Yes, gold did give us another
demonstration, if you will, butbefore we get to that, I'm
intrigued by this how you sayemails.
And First off, first off, anemail from Deeps, drums, drums,
(02:24):
and the deep and Deeps writes.
Mary and Voices (02:30):
Hi, Uncle Frank and Mary Love the podcast.
I have a question about gold.
I don't own any, but I'd liketo hear your thoughts on this.
Why shouldn't investorsconsider Sprott Physical Gold
Trust, PHYS instead oftraditional gold ETFs, given its
potential tax advantages?
While most gold ETFs are taxedat the collectibles rate of 28%
(02:54):
for long-term capital gains,PHYS can qualify for the lower
long-term capital gains rate of15% or 20%.
Beyond tax benefits, PHYSoffers full redeemability for
physical bullion and securestorage at the Royal Canadian
Mint, a crown corporation backedby the Government of Canada,
(03:22):
not that this matters.
Other than liquidity, which Idon't think a retail investor
should worry about.
Are there any disadvantages toholding PHYS?
Mostly Uncle Frank (03:33):
Sure Deeps.
We have talked about thisbefore.
Last time we talked about itwas in episode 364, but you can
also go back and listen toepisodes 166, 198, 201, 303, and
352.
The short answer is that FISP-H-Y-S has a higher expense
(03:59):
ratio and therefore tends tounderperform just about any
other gold ETF, including GLD,gldm, bar, iaum.
Take your pick.
Easiest way to see that is togo over to Testfolio and put in
different gold ETFs and checkout their relative performance,
and I'll link to one of those inthe show notes so you can check
(04:19):
that out Now.
It does offer this tax benefit,but there's a question as to how
valuable that really is,because, well, first of all, you
don't get taxed at 28% on goldunless your ordinary income rate
for that year is over 28%.
That's the max.
(04:40):
If your ordinary income ratefor the year is 12% or 22%, that
would be the rate at which youwould get taxed on capital gains
for the gold fund.
You're also not going to gettaxed on it if you hold it in a
retirement IRA or something likethat.
So you would need to calculatefor your own personal situation
(05:02):
whether it would be worthwhilefor this tax savings to overcome
the higher expense ratioBecause, also remember, you're
not typically doing a lot oftransactions in these portfolios
with gold or anything else.
You're mostly just sitting therewatching them and rebalancing
them once a year and then takingsome distributions.
(05:24):
So this isn't like a tradingoperation where you're buying
and selling a lot of gold.
And I find that a lot ofamateurs just don't understand
how capital gains taxes workanyway, because they believe
that it's on the entire amountof the investment and not just
on the capital gains.
So if you're under thatmisimpression, that also is
(05:45):
causing you to think thatthere's more benefit here than
there is Now.
As for full redeemability, no,that's not of any use generally
to most investors.
Voices (05:56):
Forget about it.
Mostly Uncle Frank (05:58):
As I've said before, the whole physical gold
sales storage thing is kind ofjust this racket that's operated
by an unholy alliance of doomscrollers and doom book writers
and people selling ads forhighly profitable gold sales and
gold storage and gold IRAs anda bunch of other nonsense that
(06:21):
nobody actually needs.
Voices (06:23):
Am I right or am I right , or am I right, right, right,
right.
Mostly Uncle Frank (06:28):
If you're going to hold gold, you should
do it like a professional hedgefund operator, in which case you
use ETFs and you don't foolaround with this nonsense.
This is an amateur hour.
Here.
We're talking about realinvestments for real people.
Voices (06:42):
No more flying solo you need somebody watching your back
at all times.
Mostly Uncle Frank (06:48):
Sorry for that little mini rant you are
the bouncers.
Voices (06:53):
I am the cooler.
All you have to do is watch myback and each other's and take
out the trash.
Mostly Uncle Frank (07:01):
But S your final question, are there any
other disadvantages to holdingfizz p-h-y-s?
The answer is no.
It's really just all in thefees when it comes down to it
that is the straight stuff.
Oh funk master and your fees mayvary depending on your tech
situation, but I would go backand listen to some of those
(07:22):
other episodes and look at thelinks there, because they also
have links to a discussion ofhow gold and gold ETFs are
actually taxed, which is justnot as problematic as a lot of
people would lead you to believe.
Voices (07:39):
Forget about it.
Mostly Uncle Frank (07:41):
So hopefully that helps and thank you for
your email.
Second off, Second off.
Voices (08:09):
Second off, we have an email from David.
Mary and Voices (08:15):
And David writes I am having trouble
loading podcast episodes 2, 3,etc.
Can you please provide a linkthat will enable me to do that?
Mostly Uncle Frank (08:26):
Well, I'm not sure where you're trying to
load the podcast from, so Ican't really answer your
question.
But this most likely has to dowith your podcast player and not
anything else.
This is distributed widely toSpotify and Apple and YouTube
and all the regular places.
But if you are looking for oneplace to find all the podcasts
(08:48):
on one page, you can go to theRisk Parity Radio feed, which is
on the podcast page at thewebsite, wwwriskparityradiocom,
near the top.
Click on that and it will opena page with all of the podcasts
and all the show notes on it.
Do not do that on your phonebecause it's too large of a page
(09:08):
to fit, so use a browser on acomputer.
But if you're ever looking fora podcast, that is the easiest
way to find it.
They're all also now uploadedon YouTube, so you can search it
there on the Risk Parity RadioYouTube channel.
(09:29):
Hopefully that helps and thankyou for your email.
Voices (09:34):
And that's the way.
Uh-huh, uh-huh, I like it.
Kc on the Sunshine Band.
Mostly Uncle Frank (09:40):
Next off, we have an email from James.
Voices (09:43):
Well, I'm waiting for you, Jimmy boy.
Mary and Voices (09:47):
And James writes Hi, frank, risk Parity
Radio is an excellent andeye-opening podcast.
Thanks for doing it.
I've done a lot of research andalthough I came up with a
lovely eight-investmentportfolio that Portfolio Charge
thinks will give me a 5.2% safewithdrawal rate, with no
international or levered funds,the problem is that my wife has
(10:10):
zero interest in managing eightdifferent investments.
Should I get hit by a Guinnesstruck?
To make it easy for her, I waswondering about a simple mix of
AVGE treasuries, cash and gold.
It gets me close to my morecomplicated portfolio, but makes
it much easier if I'm not hereto manage it.
(10:31):
We are both retired in our 60s.
I listened a couple of times toyour episodes on two funds for
life, which gave me the idea.
I'm not a fan of target datefunds for various reasons,
though I like the idea of onebroadly diversified equity fund
mixed with treasuries and just alittle gold 5% Thoughts.
Have I missed the point of riskparity?
(10:53):
Thanks?
Mostly Uncle Frank (10:55):
Well, this is a very interesting question,
James, and I think you may be onto something here.
Voices (11:00):
Yeah, baby, yeah.
Mostly Uncle Frank (11:03):
Just so everybody knows what we're
talking about.
The fund AVGE is a compositefund put out by Avantis and it
combines a whole bunch of theirregular funds from their kind of
regular US stock market fund, alot of value funds, a number of
international funds, a REITfund and according to
(11:25):
Morningstar it kind of averagesout like a large cap value fund
even though it's got all thesedifferent components in it.
So it's only been around itselffor a few years so you can't
really model anything usefuljust using the fund itself.
I did go and try to break it upinto its components and run
(11:46):
that analysis through portfoliocharts and so just to create a
sample portfolio, I assumed thatwe would create a portfolio
that was 55% AVGE, which is thestock component, and I use 55%
because that's what Bill Bengensays is probably the optimal
amount for a drawdown portfolio.
(12:08):
And then I put 25% in long-termtreasury bonds, 15% in gold and
5% in T-bills into thisportfolio.
So it took a little work tobreak down the 55% in AVGE into
its components, to put into theanalyzers at portfolio charts,
(12:31):
and I use the portfolio matrixtool to compare with other
portfolios.
But these are the numbers thatI used after I did some
calculations.
So if you want to put these inthe boxes yourself, in the stock
category in USA we have 25% inlarge cap blend, 8% in large cap
(12:51):
value, 3% in small cap blendand 2% in small cap value, and
then go down to the developedXUS row, put in 6% in large cap
blend there, 3% in large capvalue and 2% in small cap value,
and then go down to emergingmarkets and put in 3% in
(13:15):
emerging markets and then goover to REITs and put in 3% in
the REIT box and add to that 25%long-term treasuries, 15% gold
and 5% in T-bills and you willget what I believe to be an
approximation of using AVGE as55% of the portfolio, and this
(13:35):
does perform quite wellaccording to the portfolio
matrix.
In comparison, it has the thirdhighest baseline long-term
return and fourth highest safewithdrawal rate.
So it's right up there with theweird portfolio and golden
ratio portfolio and goldenbutterfly portfolio, which
doesn't surprise me because it'ssimilar in many respects.
(13:57):
So what that tells us is thisis a viable choice in terms of a
portfolio construction, asimplified portfolio
construction.
I will caution you, though,that one thing that is not
reflected in the model onportfolio charts, or rather is
implicit in the model onportfolio charts but would not
(14:17):
be in real life, is that youcannot rebalance the components
of AVGE.
They're going to be rebalancedby Avantis according to whatever
formula they have, so over timeyou are not going to get the
same kind of advantage you wouldhave of holding some of the
components individually.
That may not matter as much,because we are talking about all
(14:40):
stock components and so they'reall positively correlated
anyway.
Mary and Voices (14:45):
Don't be saucy with me, Bernays.
Mostly Uncle Frank (14:48):
One thing I do like about AVGE is that it
does map out like a large capvalue fund which is
traditionally the kind ofholding that you would hold in a
retirement portfolio if you hadsort of one choice of a kind of
asset to hold.
And that is the same sort ofstock allocation that you'll
(15:12):
find in things like the VanguardWellington Fund or Vanguard
Wellesley Fund, these large,stable companies.
So if you're only allowed topick one equity fund, you do
want something along those linesequity fund.
You do want it something alongthose lines, knowing that it
will probably lag the marketoverall over time but it's going
to have a lot less volatility,which makes it better for a
(15:35):
retirement kind of portfolio.
Voices (15:38):
Yes.
Mostly Uncle Frank (15:40):
And so, yes, this is a nice little discovery
you've made here for us.
Voices (15:44):
The best, Jerry the best .
Mostly Uncle Frank (15:46):
And I'm glad you've brought it to our
attention, because it may be auseful choice for various people
, particularly if you're lookingfor the simplest kind of
configuration that you can comeup with for one of these kinds
of portfolios.
Wow, it's very nice.
So thank you for bringing it toour attention and thank you for
(16:07):
your email.
Mary and Voices (16:10):
Class is dismissed, dismissed.
Mostly Uncle Frank (16:22):
Next off, we have an email from Stephen.
Voices (16:26):
Hey Steve.
Mostly Uncle Frank (16:28):
And Stephen writes.
Mary and Voices (16:31):
I really appreciate your service.
I hope you are gettingsomething out of it because I am
getting peace of mind.
Voices (16:40):
Yay.
Mostly Uncle Frank (16:43):
Well, I'm glad you appreciate what we do
here and that you're gettingpeace of mind out of it.
Voices (16:49):
Inconceivable.
Mostly Uncle Frank (16:51):
Makes it sound like it's one of those
meditation podcasts, though,doesn't it?
Ha ha, ha, ha, ha ha.
I do get a lot out of makingthis podcast.
It is a creative outlet.
(17:13):
It is a way to shareinformation with our adult
children that I would like themto know about investing, without
having to write it down.
Voices (17:23):
It's not that I'm lazy, it's that I just don't care.
Mostly Uncle Frank (17:27):
To support a charity, and it is a way for me
to make new acquaintances andnew friendships, which is very
important as you get older.
That's what I'm talking about.
So enjoy your peace of mind andthank you for your email Last
(17:58):
off.
Last off, of an email fromJordan.
Fortune favors the brave andJordan writes.
Mary and Voices (18:10):
Hey Frank, thanks for all you do.
What are your thoughts onhaving a tail risk hedge of
sorts, mostly for those inaccumulation who are very heavy
in equities?
Is there a place for this?
Any podcast you did or insightthat you have on this would be
so much appreciated.
Voices (18:23):
My dad said he listened to Matt Damon and lost all his
money.
Yes, everyone did, but theywere brave in doing so.
Mostly Uncle Frank (18:29):
All right, let's first define what we're
talking about, since this termtail risk or tail risk hedge may
be unfamiliar to a lot ofpeople.
This was really popularizedmostly by Nassim Taleb, who
engages in this kind of thingthrough his fund, and I don't
remember what the name of thefund is right now.
But the idea of a tail riskhedge is you are insuring
(18:55):
essentially against a stockmarket crash with the use of out
of the money put options.
So you buy all of these out ofthe money put options very
cheaply and then if the marketcrashes, they pay off, and if
the market doesn't crash, youjust lose a little bit of money.
So it's kind of a form ofinsurance.
It's one of those things thatsounds good in theory but it's
(19:18):
actually very difficult toimplement in practice because
most of the time you're justessentially throwing money away
at this because it's insuranceand it does not pay off and
there are real questions as tothe pricing of the options and
whether it's ultimatelyworthwhile.
(19:38):
You also have to stick with ituntil there is a market crash,
because it does not pay offunless and until there is a
market crash, and then it willpay off spectacularly, hopefully
making up for all of the lossesthat you incurred in prior
periods when the market was notcrashing.
Now there are some funds thattry to emulate things like this.
(19:59):
One is called TAIL T-A-I-L,another one's called CHAOS
C-A-O-S, and we've talked aboutthese sometimes Episode 149 and
episode 301 come to mind.
I've never found a really gooduse for these kinds of funds.
They just seem to take up morespace in a portfolio than they
are worth, and I'd rather devotethat space to some kind of
(20:24):
standard, measurablediversification than something
that is essentially trying tooperate as an insurance policy.
Now, your secondary questionwas whether this would be useful
in accumulation for those whoare very heavy in equities, and
the answer is certainly not inaccumulation, because you should
think of accumulation as youstarting with a portfolio that
(20:49):
is 100% in future cash, iefuture cash flows.
You're going to get throughwork or otherwise and you have
0% invested, and as you gothrough your life and you get
those cash flows and startinvesting them, your pile of
future cash goes down while yourpile of investments goes up.
(21:09):
So you're really never 100%invested in stocks until you get
much further along and areclose to stopping working or
getting those cash flows.
What this causes is essentiallya forced dollar cost averaging
over time, which is what peopledo as a practical matter.
(21:31):
Most people do not getwindfalls and invest them and
sit on them.
You're putting money in thereevery year, in your retirement
accounts or otherwise.
That in itself tends to smoothout the volatility, and you
actually want a lot ofvolatility early on in your
investment life cycle becauseyou would rather have crashes or
(21:54):
bad performances of the stockmarket so you can buy more
shares early on which will thengrow to be worth even more later
on.
This is best exemplified bysomebody who started investing
in 1929.
Now the stock market itself didnot return to par until sometime
around the 1950s, not includingdividends.
(22:17):
But if you would have justinvested through that whole time
, through the trough, yourinvestment results would have
been over 11% annualized justbecause of the dollar cost
averaging.
So when you are accumulating,you don't need insurance or tail
risk hedges or anything elselike that, because you know
you're doing this dollar costaveraging throughout time and
(22:39):
that is, in effect, giving youall the insurance you need,
because your real insurance ishaving lots of time before you
actually need to use the money.
So as it ends up, tail riskhedging is one of those things
that's fun to talk about andmuse about.
It sounds sexy, so sexy, ithurts, but it's of little
(23:02):
practical use to most people andof really no practical use to
somebody in their accumulationphase.
Voices (23:10):
Forget about it.
Mostly Uncle Frank (23:12):
So hopefully that helps and thank you for
your email.
Mary and Voices (23:17):
And now for something completely different.
Voices (23:20):
What is that?
What is that?
What is it?
Oh no, not the bees, not thebees.
Ah, I don't know.
My eyes, my eyes, ah.
Mostly Uncle Frank (23:33):
And, yes, there is no let-up for the
remaining part of the month ofMarch.
As far as the stinging of thebees are concerned, at least on
stock markets, everything elselooks not too bad or even very
good.
But just looking at thesemarkets, the S&P 500,
represented by the fund VOO, isdown 4.87% for the year so far.
(23:56):
Nasdaq fund QQQ is down 8.14%for the year so far.
Small cap value, represented bythe fund VIOV, is down 10.14%
for the year so far.
Small cap value, represented bythe fund VIOV is down 10.14%
for the year so far.
Gold continues to shine.
Voices (24:12):
I love gold.
Mostly Uncle Fra (24:16):
Representative fund GLDM is up 17.39% for the
year.
Voices (24:21):
Surely you can't be serious.
I am serious, and don't call me.
Mostly Uncle Frank (24:26):
Shirley.
Long-term treasuries,represented by the fund vglt are
up four point zero, one percentfor the year.
Reits, represented by the fundreet, are up one point one, nine
percent for the year.
Commodities, represented by thefund pdbc are up three point
six, two percent for the yearand preferred shares are
representative fund pffv are upone.62% for the year and
preferred shares arerepresentative fund PFFV are up
(24:47):
1.3% for the year.
Managed futures are still downfor the year.
Representative fund DVMF isdown 2.49% for the year.
So far it is slightly recoveredfrom where it was, but it's
interesting watching it as itpicks up various trends.
It is now, I think, longinternational stocks in emerging
markets and short the S&P 500.
(25:10):
Moving to these sampleportfolios, first one's the All
Seasons.
This is a reference portfolio.
It is only 30% in stocks and atotal stock market fund, 55% in
intermediate and long-termtreasury bonds and 15% in gold
and commodities.
It's actually helped it a lotthis year.
(25:30):
It is down 1.8% month to date.
It is up 1.92% year to date andup 10.64% since inception in
July 2020.
Moving to these bread and butter, kindbutter kind of portfolios,
first one's, golden Butterfly.
This one's 40% in stocksdivided into a total stock
market fund and a small capvalue fund, 40% in treasury
(25:54):
bonds divided into long andshort, and 20% in gold GLDM.
It is down 1.05% for the monthof March.
It is up 1.49% year-to-date andup 35.91% since inception in
July 2020.
Next one's the gold and ratio.
This one is 42% in stocksdivided into a large-cap growth
(26:16):
fund and a small-cap value fund,26% in long-term treasury bonds
, 16% in gold, 10% in managedfutures and 6% in cash.
It is down 2.3% month-to-datefor the month of March.
It's down 0.60% year-to-dateand up 29.17% since inception in
(26:38):
July 2020.
Next one's the risk parityultimate.
I'm not going to go through all14 of these funds, but it's
down 2.48% month to date.
It's up 0.47% year to date andup 21.02% since inception in
July 2020.
Now, moving to theseexperimental portfolios that all
(26:59):
involve leveraged funds.
Don't try this at home, eventhough I know some of you do.
Voices (27:05):
You have a gambling problem.
Mostly Uncle Frank (27:08):
First one's the accelerated permanent
portfolio.
This one is 27.5% in a leveredbond fund TMF, 25% in a levered
stock fund UPRO, 25% in PFFV, apreferred shares fund, and 22.5%
in gold GLDM.
It's down 5.2% month-to-date forthe month of March.
(27:30):
It's up 2.35% year-to-date andup 3.41% since inception in July
2020.
Next one's the aggressive 50-50.
This is the most levered andleast diversified of these
portfolios and is paying theprice for that.
It is one-third in a leveredstock fund UPRO, one-third in a
(27:50):
levered bond fund TMF and theremaining third in preferred
shares, pffv and an intermediatetreasury bond fund, vgit.
It is down 8.91% month-to-datefor the month of March.
It is down 8.91% month-to-datefor the month of March.
It's down 3.03% year-to-dateand down 14.6% since inception
(28:10):
in July 2020.
Next one's the levered goldenratio, which we just
reformulated last week slightly.
This one is 35% in a compositelevered fund called NTSX that's
(28:31):
the S&P 500 and treasury bonds.
20% in gold that's GLDM.
15% in a international smallcap value fund, avdv, 10% in a
managed futures fund KMLM, 10%in a levered bond fund TMF, and
the remaining 10% divided intotwo levered value funds, udao,
(28:53):
udow and UTSL, which isutilities.
It is down 2.5% months to date.
It's up 1.58% year to date anddown 2.91% since inception in
July 2021.
And the last one and newest oneis this Optra portfolio.
It's a return stacked kind ofportfolio in the modern parlance
(29:18):
.
It is 16% in a leveraged stockfund UPRO, 24% in a composite
worldwide value fund AVGV, 24%in a treasury strips fund GOVZ,
and the remaining 36% in goldand managed futures.
It is down 3.57% month to date.
(29:39):
It's up 0.11% year to date andup 3.03% since inception, july
2024.
And that concludes ourportfolio reviews of the sample
portfolios.
As you can see, although thestock market has been doing
quite badly, these portfoliosare generally holding flat for
(30:04):
the year or slightly up, andthat is due largely to their
diversification into things likegold and treasury bonds.
Voices (30:14):
Do you expect me to talk ?
No, Mr Bond, I expect you todie.
Mostly Uncle Frank (30:26):
You know it's interesting.
If you compare these kinds ofportfolios to a kind of standard
stock bond mix, you'll see thatthese kind of portfolios tend
to only have two down years outof 10, so 20% down years,
whereas more standard stock bondportfolios tend to be down
about 30% of the time, and sothere's one year in 10 when
these portfolios are up andstandard portfolios are down.
(30:47):
So far, this looks like thiscould be that year.
Voices (30:52):
Bing again.
Mostly Uncle Frank (30:54):
But it's still quite early, it's only one
quarter way through the year.
But these are basicallyperforming as they have
historically in markets likethese.
But we will be proceeding withmonthly distributions next week,
which I expect will involveselling a bunch of gold to the
extent that cash has not beenaccumulated to pay these
(31:16):
distributions, which it has inabout half of these accounts.
But now I see our signal isbeginning to fade.
If you have comments orquestions for me, please send
them to frank atriskparityradiocom.
That email is frank atriskparityradiocom.
Or you can go to the websitewwwriskparityradiocom, put your
(31:39):
message into the contact formand I'll get it that way.
We are almost finished with allof the emails from January and
I hope to be finished with thatin the next episode We'll see.
If you haven't had a chance todo it.
Please go to your favoritepodcast provider and like
subscribe.
Give me some stars, a follow, areview.
(32:00):
That would be great.
Mary and Voices (32:03):
Okay.
Mostly Uncle Frank (32:05):
Thank you once again for tuning in.
This is Frank Vasquez with RiskParty Radio signing off.
Voices (32:15):
Goldfinger.
Pretty girl, beware of thisheart of gold.
This heart is cold.
He loves only gold, only gold.
(32:40):
He loves gold.
He loves only gold, only gold.
He loves gold.
Mary and Voices (33:18):
He loves gold.
I'm sorry, with your ownadvisors before taking any
actions based on any informationyou have heard here, making
sure to take into account yourown personal circumstances.
A foolish consistency, is the hobgoblin of
little minds, adored by littlestatesmen and philosophers and
divines.
Mostly Uncle Frank (00:10):
If a man does not keep pace with his
companions, perhaps it isbecause he hears a different
drummer, a different drummer.
Mary and Voices (00:19):
And now, coming to you from dead center on your
dial, welcome to Risk ParityRadio, where we explore
alternatives and assetallocations for the
do-it-yourself investor,broadcasting to you now from the
comfort of his easy chair.
Here is your host, frankVasquez.
Mostly Uncle Frank (00:37):
Thank you, Mary, and welcome to Risk Parity
Radio.
If you are new here and wonderwhat we are talking about, you
may wish to go back and listento some of the foundational
episodes for this program.
Voices (00:49):
Yeah, baby, yeah.
Mostly Uncle Frank (00:51):
And the basic foundational episodes are
episodes 1, 3, 5, 7, and 9.
Some of our listeners,including Karen and Chris, have
identified additional episodesthat you may consider
foundational, and those areepisodes 12, 14, 16, 19, 21, 56,
(01:13):
82, and 184.
Whoa, and you probably shouldcheck those out too, because we
have the finest podcast audienceavailable.
Mary and Voices (01:26):
Top drawer, really top drawer.
Mostly Uncle Frank (01:30):
Along with a host named after a hot dog.
Voices (01:34):
Lighten up Francis.
Mostly Uncle Frank (01:37):
But now onward, episode 410.
Today, on Risk Parity Radio,it's time for our weekly
portfolio reviews.
Of the eight sample portfoliosyou can find at
wwwriskparityradiocom on theportfolios page.
Mary and Voices (01:53):
This is gold, Mr.
Voices (01:54):
Bond, I think you've made your point.
Goldfinger, thank you for thedemonstration.
Mostly Uncle Frank (02:01):
Yes, gold did give us another
demonstration, if you will, butbefore we get to that, I'm
intrigued by this how you sayemails.
And First off, first off, anemail from Deeps, drums, drums,
(02:24):
and the deep and Deeps writes.
Mary and Voices (02:30):
Hi, Uncle Frank and Mary Love the podcast.
I have a question about gold.
I don't own any, but I'd liketo hear your thoughts on this.
Why shouldn't investorsconsider Sprott Physical Gold
Trust, PHYS instead oftraditional gold ETFs, given its
potential tax advantages?
While most gold ETFs are taxedat the collectibles rate of 28%
(02:54):
for long-term capital gains,PHYS can qualify for the lower
long-term capital gains rate of15% or 20%.
Beyond tax benefits, PHYSoffers full redeemability for
physical bullion and securestorage at the Royal Canadian
Mint, a crown corporation backedby the Government of Canada,
(03:22):
not that this matters.
Other than liquidity, which Idon't think a retail investor
should worry about.
Are there any disadvantages toholding PHYS?
Mostly Uncle Frank (03:33):
Sure Deeps.
We have talked about thisbefore.
Last time we talked about itwas in episode 364, but you can
also go back and listen toepisodes 166, 198, 201, 303, and
352.
The short answer is that FISP-H-Y-S has a higher expense
(03:59):
ratio and therefore tends tounderperform just about any
other gold ETF, including GLD,gldm, bar, iaum.
Take your pick.
Easiest way to see that is togo over to Testfolio and put in
different gold ETFs and checkout their relative performance,
and I'll link to one of those inthe show notes so you can check
(04:19):
that out Now.
It does offer this tax benefit,but there's a question as to how
valuable that really is,because, well, first of all, you
don't get taxed at 28% on goldunless your ordinary income rate
for that year is over 28%.
That's the max.
(04:40):
If your ordinary income ratefor the year is 12% or 22%, that
would be the rate at which youwould get taxed on capital gains
for the gold fund.
You're also not going to gettaxed on it if you hold it in a
retirement IRA or something likethat.
So you would need to calculatefor your own personal situation
(05:02):
whether it would be worthwhilefor this tax savings to overcome
the higher expense ratioBecause, also remember, you're
not typically doing a lot oftransactions in these portfolios
with gold or anything else.
You're mostly just sitting therewatching them and rebalancing
them once a year and then takingsome distributions.
(05:24):
So this isn't like a tradingoperation where you're buying
and selling a lot of gold.
And I find that a lot ofamateurs just don't understand
how capital gains taxes workanyway, because they believe
that it's on the entire amountof the investment and not just
on the capital gains.
So if you're under thatmisimpression, that also is
(05:45):
causing you to think thatthere's more benefit here than
there is Now.
As for full redeemability, no,that's not of any use generally
to most investors.
Voices (05:56):
Forget about it.
Mostly Uncle Frank (05:58):
As I've said before, the whole physical gold
sales storage thing is kind ofjust this racket that's operated
by an unholy alliance of doomscrollers and doom book writers
and people selling ads forhighly profitable gold sales and
gold storage and gold IRAs anda bunch of other nonsense that
(06:21):
nobody actually needs.
Voices (06:23):
Am I right or am I right , or am I right, right, right,
right.
Mostly Uncle Frank (06:28):
If you're going to hold gold, you should
do it like a professional hedgefund operator, in which case you
use ETFs and you don't foolaround with this nonsense.
This is an amateur hour.
Here.
We're talking about realinvestments for real people.
Voices (06:42):
No more flying solo you need somebody watching your back
at all times.
Mostly Uncle Frank (06:48):
Sorry for that little mini rant you are
the bouncers.
Voices (06:53):
I am the cooler.
All you have to do is watch myback and each other's and take
out the trash.
Mostly Uncle Frank (07:01):
But S your final question, are there any
other disadvantages to holdingfizz p-h-y-s?
The answer is no.
It's really just all in thefees when it comes down to it
that is the straight stuff.
Oh funk master and your fees mayvary depending on your tech
situation, but I would go backand listen to some of those
(07:22):
other episodes and look at thelinks there, because they also
have links to a discussion ofhow gold and gold ETFs are
actually taxed, which is justnot as problematic as a lot of
people would lead you to believe.
Voices (07:39):
Forget about it.
Mostly Uncle Frank (07:41):
So hopefully that helps and thank you for
your email.
Second off, Second off.
Voices (08:09):
Second off, we have an email from David.
Mary and Voices (08:15):
And David writes I am having trouble
loading podcast episodes 2, 3,etc.
Can you please provide a linkthat will enable me to do that?
Mostly Uncle Frank (08:26):
Well, I'm not sure where you're trying to
load the podcast from, so Ican't really answer your
question.
But this most likely has to dowith your podcast player and not
anything else.
This is distributed widely toSpotify and Apple and YouTube
and all the regular places.
But if you are looking for oneplace to find all the podcasts
(08:48):
on one page, you can go to theRisk Parity Radio feed, which is
on the podcast page at thewebsite, wwwriskparityradiocom,
near the top.
Click on that and it will opena page with all of the podcasts
and all the show notes on it.
Do not do that on your phonebecause it's too large of a page
(09:08):
to fit, so use a browser on acomputer.
But if you're ever looking fora podcast, that is the easiest
way to find it.
They're all also now uploadedon YouTube, so you can search it
there on the Risk Parity RadioYouTube channel.
(09:29):
Hopefully that helps and thankyou for your email.
Voices (09:34):
And that's the way.
Uh-huh, uh-huh, I like it.
Kc on the Sunshine Band.
Mostly Uncle Frank (09:40):
Next off, we have an email from James.
Voices (09:43):
Well, I'm waiting for you, Jimmy boy.
Mary and Voices (09:47):
And James writes Hi, frank, risk Parity
Radio is an excellent andeye-opening podcast.
Thanks for doing it.
I've done a lot of research andalthough I came up with a
lovely eight-investmentportfolio that Portfolio Charge
thinks will give me a 5.2% safewithdrawal rate, with no
international or levered funds,the problem is that my wife has
(10:10):
zero interest in managing eightdifferent investments.
Should I get hit by a Guinnesstruck?
To make it easy for her, I waswondering about a simple mix of
AVGE treasuries, cash and gold.
It gets me close to my morecomplicated portfolio, but makes
it much easier if I'm not hereto manage it.
(10:31):
We are both retired in our 60s.
I listened a couple of times toyour episodes on two funds for
life, which gave me the idea.
I'm not a fan of target datefunds for various reasons,
though I like the idea of onebroadly diversified equity fund
mixed with treasuries and just alittle gold 5% Thoughts.
Have I missed the point of riskparity?
(10:53):
Thanks?
Mostly Uncle Frank (10:55):
Well, this is a very interesting question,
James, and I think you may be onto something here.
Voices (11:00):
Yeah, baby, yeah.
Mostly Uncle Frank (11:03):
Just so everybody knows what we're
talking about.
The fund AVGE is a compositefund put out by Avantis and it
combines a whole bunch of theirregular funds from their kind of
regular US stock market fund, alot of value funds, a number of
international funds, a REITfund and according to
(11:25):
Morningstar it kind of averagesout like a large cap value fund
even though it's got all thesedifferent components in it.
So it's only been around itselffor a few years so you can't
really model anything usefuljust using the fund itself.
I did go and try to break it upinto its components and run
(11:46):
that analysis through portfoliocharts and so just to create a
sample portfolio, I assumed thatwe would create a portfolio
that was 55% AVGE, which is thestock component, and I use 55%
because that's what Bill Bengensays is probably the optimal
amount for a drawdown portfolio.
(12:08):
And then I put 25% in long-termtreasury bonds, 15% in gold and
5% in T-bills into thisportfolio.
So it took a little work tobreak down the 55% in AVGE into
its components, to put into theanalyzers at portfolio charts,
(12:31):
and I use the portfolio matrixtool to compare with other
portfolios.
But these are the numbers thatI used after I did some
calculations.
So if you want to put these inthe boxes yourself, in the stock
category in USA we have 25% inlarge cap blend, 8% in large cap
(12:51):
value, 3% in small cap blendand 2% in small cap value, and
then go down to the developedXUS row, put in 6% in large cap
blend there, 3% in large capvalue and 2% in small cap value,
and then go down to emergingmarkets and put in 3% in
(13:15):
emerging markets and then goover to REITs and put in 3% in
the REIT box and add to that 25%long-term treasuries, 15% gold
and 5% in T-bills and you willget what I believe to be an
approximation of using AVGE as55% of the portfolio, and this
(13:35):
does perform quite wellaccording to the portfolio
matrix.
In comparison, it has the thirdhighest baseline long-term
return and fourth highest safewithdrawal rate.
So it's right up there with theweird portfolio and golden
ratio portfolio and goldenbutterfly portfolio, which
doesn't surprise me because it'ssimilar in many respects.
(13:57):
So what that tells us is thisis a viable choice in terms of a
portfolio construction, asimplified portfolio
construction.
I will caution you, though,that one thing that is not
reflected in the model onportfolio charts, or rather is
implicit in the model onportfolio charts but would not
(14:17):
be in real life, is that youcannot rebalance the components
of AVGE.
They're going to be rebalancedby Avantis according to whatever
formula they have, so over timeyou are not going to get the
same kind of advantage you wouldhave of holding some of the
components individually.
That may not matter as much,because we are talking about all
(14:40):
stock components and so they'reall positively correlated
anyway.
Mary and Voices (14:45):
Don't be saucy with me, Bernays.
Mostly Uncle Frank (14:48):
One thing I do like about AVGE is that it
does map out like a large capvalue fund which is
traditionally the kind ofholding that you would hold in a
retirement portfolio if you hadsort of one choice of a kind of
asset to hold.
And that is the same sort ofstock allocation that you'll
(15:12):
find in things like the VanguardWellington Fund or Vanguard
Wellesley Fund, these large,stable companies.
So if you're only allowed topick one equity fund, you do
want something along those linesequity fund.
You do want it something alongthose lines, knowing that it
will probably lag the marketoverall over time but it's going
to have a lot less volatility,which makes it better for a
(15:35):
retirement kind of portfolio.
Voices (15:38):
Yes.
Mostly Uncle Frank (15:40):
And so, yes, this is a nice little discovery
you've made here for us.
Voices (15:44):
The best, Jerry the best .
Mostly Uncle Frank (15:46):
And I'm glad you've brought it to our
attention, because it may be auseful choice for various people
, particularly if you're lookingfor the simplest kind of
configuration that you can comeup with for one of these kinds
of portfolios.
Wow, it's very nice.
So thank you for bringing it toour attention and thank you for
(16:07):
your email.
Mary and Voices (16:10):
Class is dismissed, dismissed.
Mostly Uncle Frank (16:22):
Next off, we have an email from Stephen.
Voices (16:26):
Hey Steve.
Mostly Uncle Frank (16:28):
And Stephen writes.
Mary and Voices (16:31):
I really appreciate your service.
I hope you are gettingsomething out of it because I am
getting peace of mind.
Voices (16:40):
Yay.
Mostly Uncle Frank (16:43):
Well, I'm glad you appreciate what we do
here and that you're gettingpeace of mind out of it.
Voices (16:49):
Inconceivable.
Mostly Uncle Frank (16:51):
Makes it sound like it's one of those
meditation podcasts, though,doesn't it?
Ha ha, ha, ha, ha ha.
I do get a lot out of makingthis podcast.
It is a creative outlet.
(17:13):
It is a way to shareinformation with our adult
children that I would like themto know about investing, without
having to write it down.
Voices (17:23):
It's not that I'm lazy, it's that I just don't care.
Mostly Uncle Frank (17:27):
To support a charity, and it is a way for me
to make new acquaintances andnew friendships, which is very
important as you get older.
That's what I'm talking about.
So enjoy your peace of mind andthank you for your email Last
(17:58):
off.
Last off, of an email fromJordan.
Fortune favors the brave andJordan writes.
Mary and Voices (18:10):
Hey Frank, thanks for all you do.
What are your thoughts onhaving a tail risk hedge of
sorts, mostly for those inaccumulation who are very heavy
in equities?
Is there a place for this?
Any podcast you did or insightthat you have on this would be
so much appreciated.
Voices (18:23):
My dad said he listened to Matt Damon and lost all his
money.
Yes, everyone did, but theywere brave in doing so.
Mostly Uncle Frank (18:29):
All right, let's first define what we're
talking about, since this termtail risk or tail risk hedge may
be unfamiliar to a lot ofpeople.
This was really popularizedmostly by Nassim Taleb, who
engages in this kind of thingthrough his fund, and I don't
remember what the name of thefund is right now.
But the idea of a tail riskhedge is you are insuring
(18:55):
essentially against a stockmarket crash with the use of out
of the money put options.
So you buy all of these out ofthe money put options very
cheaply and then if the marketcrashes, they pay off, and if
the market doesn't crash, youjust lose a little bit of money.
So it's kind of a form ofinsurance.
It's one of those things thatsounds good in theory but it's
(19:18):
actually very difficult toimplement in practice because
most of the time you're justessentially throwing money away
at this because it's insuranceand it does not pay off and
there are real questions as tothe pricing of the options and
whether it's ultimatelyworthwhile.
(19:38):
You also have to stick with ituntil there is a market crash,
because it does not pay offunless and until there is a
market crash, and then it willpay off spectacularly, hopefully
making up for all of the lossesthat you incurred in prior
periods when the market was notcrashing.
Now there are some funds thattry to emulate things like this.
(19:59):
One is called TAIL T-A-I-L,another one's called CHAOS
C-A-O-S, and we've talked aboutthese sometimes Episode 149 and
episode 301 come to mind.
I've never found a really gooduse for these kinds of funds.
They just seem to take up morespace in a portfolio than they
are worth, and I'd rather devotethat space to some kind of
(20:24):
standard, measurablediversification than something
that is essentially trying tooperate as an insurance policy.
Now, your secondary questionwas whether this would be useful
in accumulation for those whoare very heavy in equities, and
the answer is certainly not inaccumulation, because you should
think of accumulation as youstarting with a portfolio that
(20:49):
is 100% in future cash, iefuture cash flows.
You're going to get throughwork or otherwise and you have
0% invested, and as you gothrough your life and you get
those cash flows and startinvesting them, your pile of
future cash goes down while yourpile of investments goes up.
(21:09):
So you're really never 100%invested in stocks until you get
much further along and areclose to stopping working or
getting those cash flows.
What this causes is essentiallya forced dollar cost averaging
over time, which is what peopledo as a practical matter.
(21:31):
Most people do not getwindfalls and invest them and
sit on them.
You're putting money in thereevery year, in your retirement
accounts or otherwise.
That in itself tends to smoothout the volatility, and you
actually want a lot ofvolatility early on in your
investment life cycle becauseyou would rather have crashes or
(21:54):
bad performances of the stockmarket so you can buy more
shares early on which will thengrow to be worth even more later
on.
This is best exemplified bysomebody who started investing
in 1929.
Now the stock market itself didnot return to par until sometime
around the 1950s, not includingdividends.
(22:17):
But if you would have justinvested through that whole time
, through the trough, yourinvestment results would have
been over 11% annualized justbecause of the dollar cost
averaging.
So when you are accumulating,you don't need insurance or tail
risk hedges or anything elselike that, because you know
you're doing this dollar costaveraging throughout time and
(22:39):
that is, in effect, giving youall the insurance you need,
because your real insurance ishaving lots of time before you
actually need to use the money.
So as it ends up, tail riskhedging is one of those things
that's fun to talk about andmuse about.
It sounds sexy, so sexy, ithurts, but it's of little
(23:02):
practical use to most people andof really no practical use to
somebody in their accumulationphase.
Voices (23:10):
Forget about it.
Mostly Uncle Frank (23:12):
So hopefully that helps and thank you for
your email.
Mary and Voices (23:17):
And now for something completely different.
Voices (23:20):
What is that?
What is that?
What is it?
Oh no, not the bees, not thebees.
Ah, I don't know.
My eyes, my eyes, ah.
Mostly Uncle Frank (23:33):
And, yes, there is no let-up for the
remaining part of the month ofMarch.
As far as the stinging of thebees are concerned, at least on
stock markets, everything elselooks not too bad or even very
good.
But just looking at thesemarkets, the S&P 500,
represented by the fund VOO, isdown 4.87% for the year so far.
(23:56):
Nasdaq fund QQQ is down 8.14%for the year so far.
Small cap value, represented bythe fund VIOV, is down 10.14%
for the year so far.
Small cap value, represented bythe fund VIOV is down 10.14%
for the year so far.
Gold continues to shine.
Voices (24:12):
I love gold.
Mostly Uncle Fra (24:16):
Representative fund GLDM is up 17.39% for the
year.
Voices (24:21):
Surely you can't be serious.
I am serious, and don't call me.
Mostly Uncle Frank (24:26):
Shirley.
Long-term treasuries,represented by the fund vglt are
up four point zero, one percentfor the year.
Reits, represented by the fundreet, are up one point one, nine
percent for the year.
Commodities, represented by thefund pdbc are up three point
six, two percent for the yearand preferred shares are
representative fund pffv are upone.62% for the year and
preferred shares arerepresentative fund PFFV are up
(24:47):
1.3% for the year.
Managed futures are still downfor the year.
Representative fund DVMF isdown 2.49% for the year.
So far it is slightly recoveredfrom where it was, but it's
interesting watching it as itpicks up various trends.
It is now, I think, longinternational stocks in emerging
markets and short the S&P 500.
(25:10):
Moving to these sampleportfolios, first one's the All
Seasons.
This is a reference portfolio.
It is only 30% in stocks and atotal stock market fund, 55% in
intermediate and long-termtreasury bonds and 15% in gold
and commodities.
It's actually helped it a lotthis year.
(25:30):
It is down 1.8% month to date.
It is up 1.92% year to date andup 10.64% since inception in
July 2020.
Moving to these bread and butter, kindbutter kind of portfolios,
first one's, golden Butterfly.
This one's 40% in stocksdivided into a total stock
market fund and a small capvalue fund, 40% in treasury
(25:54):
bonds divided into long andshort, and 20% in gold GLDM.
It is down 1.05% for the monthof March.
It is up 1.49% year-to-date andup 35.91% since inception in
July 2020.
Next one's the gold and ratio.
This one is 42% in stocksdivided into a large-cap growth
(26:16):
fund and a small-cap value fund,26% in long-term treasury bonds
, 16% in gold, 10% in managedfutures and 6% in cash.
It is down 2.3% month-to-datefor the month of March.
It's down 0.60% year-to-dateand up 29.17% since inception in
(26:38):
July 2020.
Next one's the risk parityultimate.
I'm not going to go through all14 of these funds, but it's
down 2.48% month to date.
It's up 0.47% year to date andup 21.02% since inception in
July 2020.
Now, moving to theseexperimental portfolios that all
(26:59):
involve leveraged funds.
Don't try this at home, eventhough I know some of you do.
Voices (27:05):
You have a gambling problem.
Mostly Uncle Frank (27:08):
First one's the accelerated permanent
portfolio.
This one is 27.5% in a leveredbond fund TMF, 25% in a levered
stock fund UPRO, 25% in PFFV, apreferred shares fund, and 22.5%
in gold GLDM.
It's down 5.2% month-to-date forthe month of March.
(27:30):
It's up 2.35% year-to-date andup 3.41% since inception in July
2020.
Next one's the aggressive 50-50.
This is the most levered andleast diversified of these
portfolios and is paying theprice for that.
It is one-third in a leveredstock fund UPRO, one-third in a
(27:50):
levered bond fund TMF and theremaining third in preferred
shares, pffv and an intermediatetreasury bond fund, vgit.
It is down 8.91% month-to-datefor the month of March.
It is down 8.91% month-to-datefor the month of March.
It's down 3.03% year-to-dateand down 14.6% since inception
(28:10):
in July 2020.
Next one's the levered goldenratio, which we just
reformulated last week slightly.
This one is 35% in a compositelevered fund called NTSX that's
(28:31):
the S&P 500 and treasury bonds.
20% in gold that's GLDM.
15% in a international smallcap value fund, avdv, 10% in a
managed futures fund KMLM, 10%in a levered bond fund TMF, and
the remaining 10% divided intotwo levered value funds, udao,
(28:53):
udow and UTSL, which isutilities.
It is down 2.5% months to date.
It's up 1.58% year to date anddown 2.91% since inception in
July 2021.
And the last one and newest oneis this Optra portfolio.
It's a return stacked kind ofportfolio in the modern parlance
(29:18):
.
It is 16% in a leveraged stockfund UPRO, 24% in a composite
worldwide value fund AVGV, 24%in a treasury strips fund GOVZ,
and the remaining 36% in goldand managed futures.
It is down 3.57% month to date.
(29:39):
It's up 0.11% year to date andup 3.03% since inception, july
2024.
And that concludes ourportfolio reviews of the sample
portfolios.
As you can see, although thestock market has been doing
quite badly, these portfoliosare generally holding flat for
(30:04):
the year or slightly up, andthat is due largely to their
diversification into things likegold and treasury bonds.
Voices (30:14):
Do you expect me to talk ?
No, Mr Bond, I expect you todie.
Mostly Uncle Frank (30:26):
You know it's interesting.
If you compare these kinds ofportfolios to a kind of standard
stock bond mix, you'll see thatthese kind of portfolios tend
to only have two down years outof 10, so 20% down years,
whereas more standard stock bondportfolios tend to be down
about 30% of the time, and sothere's one year in 10 when
these portfolios are up andstandard portfolios are down.
(30:47):
So far, this looks like thiscould be that year.
Voices (30:52):
Bing again.
Mostly Uncle Frank (30:54):
But it's still quite early, it's only one
quarter way through the year.
But these are basicallyperforming as they have
historically in markets likethese.
But we will be proceeding withmonthly distributions next week,
which I expect will involveselling a bunch of gold to the
extent that cash has not beenaccumulated to pay these
(31:16):
distributions, which it has inabout half of these accounts.
But now I see our signal isbeginning to fade.
If you have comments orquestions for me, please send
them to frank atriskparityradiocom.
That email is frank atriskparityradiocom.
Or you can go to the websitewwwriskparityradiocom, put your
(31:39):
message into the contact formand I'll get it that way.
We are almost finished with allof the emails from January and
I hope to be finished with thatin the next episode We'll see.
If you haven't had a chance todo it.
Please go to your favoritepodcast provider and like
subscribe.
Give me some stars, a follow, areview.
(32:00):
That would be great.
Mary and Voices (32:03):
Okay.
Mostly Uncle Frank (32:05):
Thank you once again for tuning in.
This is Frank Vasquez with RiskParty Radio signing off.
Voices (32:15):
Goldfinger.
Pretty girl, beware of thisheart of gold.
This heart is cold.
He loves only gold, only gold.
(32:40):
He loves gold.
He loves only gold, only gold.
He loves gold.
Mary and Voices (33:18):
He loves gold.
I'm sorry, with your ownadvisors before taking any
actions based on any informationyou have heard here, making
sure to take into account yourown personal circumstances.
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