Mostly Voices [0:00]

A foolish consistency is the hobgoblin of little minds, adored by little statesmen and philosophers and divines. If a man does not keep pace with his companions, perhaps it is because he hears a different drummer. A different drummer.

Mostly Mary [0:18]

And now, coming to you from dead center on your dial, welcome to Risk Parity Radio, where we explore alternatives and asset allocations for the do-it-yourself investor. Broadcasting to you now from the comfort of his easy chair, here is your host, Frank Vasquez.

Mostly Uncle Frank [0:36]

Thank you, Mary, and welcome to Risk Parity Radio. If you are new here and wonder what we are talking about, you may wish to go back and listen to some of the first episodes where we did our introductions of the various topics. And those episodes are episode 1-3, 5, 7, and 9. And so, if you go back and listen to those, it will get you up to speed. But now onward to episode 149. Today on Risk Parity Radio, it is time for our weekly portfolio reviews of the seven sample portfolios that you can find at www.riskparityradio.com on the portfolios page.

Mostly Voices [1:25]

But before we get to that, I'm intrigued by this, how you say, emails.

Mostly Uncle Frank [1:32]

And first off, first off, we have an email from Alexei.

Mostly Voices [1:36]

So that's what you call me, you know, that or his dudeness or duder or, you know, Bruce Dickinson, if you're not into the whole brevity thing.

Mostly Uncle Frank [1:48]

And Alexei writes.

Mostly Mary [1:53]

Uncle Frank, in MEB Faber Episode 317, the Chris Cole interview, Cole covered true diversifiers of equities bond-based portfolios. The usual suspects were there, including gold, managed futures, and long volatility, but one that he mentioned in passing that added value was merger arbitrage strategies. Here's a nice podcast I found on the strategy in general and its harvesting of the liquidity premium. A quick review in Portfolio Visualizer finds a couple of interesting ETF candidates for inclusion in a risk parity portfolio, particularly MNA. These aren't as exciting as CROC to me because of their low volatility, low return profile, but maybe of interest for inclusion in more complex portfolios.

Mostly Uncle Frank [2:33]

All right, I do believe I have listened to that podcast, that MEB FAVOR podcast of a Chris Cole interview. Just so all of you know what we're talking about, Chris Cole is a fund manager with a firm called Artemis Capital, and he has come up with something called the Dragon Portfolio, which you might describe as risk parity on steroids. We talked about this back in episodes 53 and 55, and also talked more about it in episodes 98 and 110, and gave some links to Artemis Capital if you're interested in looking at that. But anyway, the Dragon Portfolio not only includes the typical things that we talk about here, but is also using managed futures, which are trend following and long volatility, which is the volatility funds we try to use here but aren't very successful with. But anyway, that is a sort of a commercial preparation in the form of a hedge fund that you can explore if you like in the episodes that I mentioned and the show notes there with links to Artemis Capital, which I will also provide again at least one link here if you want to look at that stuff. They have some reports on this. But anyway, in terms of merger arbitrage strategies, I did look at these funds at the time that I listened to that interview, and it just didn't seem like they fit very well. into what we can do here as do-it-yourself investors. The main problem I saw with at least the funds that are available is that they just have low returns. So it would be a drag in terms of the return profile. And then they are not sufficiently negatively correlated with your stocks to really give you a big diversification benefit.

Mostly Voices [4:26]

Forget about it.

Mostly Uncle Frank [4:30]

So where I come out with this now is that I'm open to suggestion as far as Finding ETFs that employ merger arbitrage strategies, but I haven't run across one that I would feel confident enough to actually allocate any money to. But I do think this is part of this evolution we are experiencing now with having more and more ETFs with more and more opportunities for different kinds of investments that just weren't available in the past to mere mortals such as we are. Bring out your dead! Bring out your dead! But also, if you wanted to hear more about C-R-O-C, Croc, you can go back and listen to that episode just a few ago. I believe it's episode 146. And thank you for that email. Moving along. Second off, second off, we have an email from Vaughn. And Vaughn writes.

Mostly Mary [5:28]

Hi, Frank. I'm 25 years old and on my financial independence journey. I've been soaking up as much information as I can to optimize my portfolio. In the process, I've run across your name many times and I always learn something new. I've noticed that you're very generous when it comes to sharing your wisdom and was wondering if you could share with me your thoughts on my portfolio. I have about $100,000 invested. 80,000 of that is in tax advantaged accounts, 401k, Roth IRA, HSA, and invested in VTI type funds. I have 10,000 in I bonds. The final 10,000 is in a taxable account also invested in VTI. You've inspired me to diversify my portfolio. Since you've gotten me into this mess, I'm counting on you to clear things up for me a little. I was thinking on trading 50% of my VTI and diversifying with small cap value, international index, Real estate index 5%, emerging markets index 5%. I know some funds aren't as tax efficient as others, but don't know which. Could you help me optimize my fund location between my taxable and tax advantaged accounts? Or tell me I'm an idiot for picking that allocation and recommend something else. I appreciate your time and hope to hear back from you.

Mostly Voices [6:45]

Before we're done here, y'all be wearing gold-plated diapers.

Mostly Uncle Frank [6:50]

All right, this really goes to what we call the macro allocation principle, which you need to understand. And this comes from chapters 18 and 19 of Common Sense Investing by Jack Bogle, although he references many other sources for this information. And what is revealed there is essentially when you have a portfolio, and they were talking about stock bond portfolios, and they were looking at 60/40 portfolios and 80/20 and 100/0. And the conclusion was, based on reviewing the performance of different hundreds or thousands of fund managers trying to create these things and compete with one another, is that every portfolio of the same macro allocation performed 94%, I think he said, I go with 90% the same essentially as any other reasonably well diversified portfolio with that same macro allocation. So applying that here, you're talking about a 100% equity portfolio right now. And what this basically says is that if you have a reasonably well diversified 100% equity portfolio, it is likely to perform 90% plus the same as any other reasonably well diversified 100% equity portfolio. And the main problem is you're not going to know which version was the best, except in hindsight. And Bogle's point on this was just pick a decent portfolio that's low cost and ride that because avoiding the cost factor and jumping around fund shopping were actually the worst sins. So applying that to your portfolio, what you've constructed is fine. The real question is are you willing to stick with that long term? Because what amateur investors frequently do is select a portfolio have it for a few years, then look at it and say, oh, this fund is not performing that well. Maybe I should jump out of that and jump into something else. And so they end up jumping and hopping around, and by doing that they end up underperforming the portfolio that they selected to begin with. The only funds that have been found to be advantageous over long periods of time have been the small cap value funds. You're gonna want that cowbell. as first discovered by Fama and French back in the 1990s. So where I always end up coming out on this is if you're going to have 100% equity portfolio, make sure it's got some small cap value in it.

Mostly Voices [9:20]

I got to have more cowbell.

Mostly Uncle Frank [9:24]

And after that, if it's low cost and reasonably well diversified, go with whatever suits your interests, which means what you selected looks fine to me. The only modification I would suggest to it is look at what you are investing in carefully for the international index. because a lot of those funds, the main big ones, end up having essentially a lot of large cap value in them. And large cap value is probably not where you would want to go for an accumulation portfolio. That is something that you might want to hold for more stability in a portfolio when you get older. Because we're talking about companies like Nestle and Unilever and Toyota. So one thing you might think about there is seeing whether you can actually get into small cap value on the international side. I gotta have more cowbell. I'm aware of a relatively new fund called AVDV, which looks promising. This is part of Avantis Funds, and these are constructed by Dimensional Fund Advisors, who is famous for doing a very good job in creating funds but they were previously only available if you went through a financial advisor and only in mutual fund form. Now they've realized they have to actually compete with everything else going on. So they've created some ETFs that are the same makeup of what they were previously only offering through this financial advisor network. And AVDV is their international small cap value fund. Yes! So if I were starting from scratch and wanted to put an international fund into a portfolio, I might look to something like that. The only problem is it's only been around for a couple of years now, but the basis for it has been around for a couple of decades.

Mostly Voices [11:19]

I'm telling you fellas, you're gonna want that cowbell.

Mostly Uncle Frank [11:22]

But whatever you choose, you just should make a commitment to that you're going to stick with it for a decade or more. I'll be honest, fellas, it was sounding great, but I could have used a little more cowbell. Now, in terms of allocating which fund goes where, fund location, well, the only obvious thing is that the REIT index fund should go in a retirement account because it pays typically ordinary income, and so you wouldn't want it in your taxable account. the other stuff can generally go in either place, but do look at whatever funds you're selecting because if they have certain characteristics in terms of throwing off lots of income for whatever reason, then you might want to put them in the retirement account as opposed to the taxable account. These things, at least the ones you're talking about, I would ordinarily think they would be barely taxed in a taxable account, particularly if you're not buying and selling them. So I don't think Your taxes are going to be a very big factor in what you're doing here. And hopefully that helps and thank you for that email. Bow to your sensei. Bow to your sensei. Moving along, we have an email from Yamini and Yamini writes.

Mostly Mary [12:35]

Hi Frank, would love to listen to your podcast. Thanks, Yamini.

Mostly Uncle Frank [12:39]

Well, you found my website, so hopefully you found the link there to the podcast. and you can listen to it there. I put some more links on the homepage just to make it easier for people to get there. So hopefully you can hear this and thank you for that email. And now for our next trick, we have a twofer from Jamie. Two emails from Jamie and Jamie writes.

Mostly Mary [13:07]

In several of your podcasts, you have mentioned that you tend to invest in fairly niche insurance investments that you found have a positive impact on your risk parity portfolios. Can you enlighten us on what they are and why they work, if you haven't already? Thank you. Apologies, but another question. Have you heard of the tail risk parity approach spelled out in the below article? If so, what do you think? And how would it affect portfolio construction? It seemed interesting on the surface, but I had trouble unmasking the assets they discuss.

Mostly Uncle Frank [13:42]

All right, let's first talk about these insurance investments. Well, first of all, I do not recommend that you invest in insurance contracts. Do you have life insurance? Because if you do, you could always use a little more. That's not what we're talking about here. Forget about it. I have in the past talked about private placement insurance, which is something that somebody who has an estate over $20 million might want to look into. you would need two to five million dollars to put in one of those kinds of policies and those are specifically designed with portfolios inside an insurance wrapper but their entire purpose is really to deal with estate taxes and most of us are just not there.

Mostly Voices [14:28]

You can't handle the pop roast.

Mostly Uncle Frank [14:32]

But I don't even think that's what you were asking about. I think what you were asking about was what we talked about in episode 101 which is that I have found that investing in insurance companies is a good diversification mechanism from your usual funds, your usual total market funds in particular. Insurance companies behave a lot like small cap value and there is a fund that you could invest in called KBWP, which holds about 20 property and casualty insurance companies. And the main holdings in that fund are Progressive, Allstate, AIG, Chubb, and Travelers. All very boring names you've heard about. And then there are a bunch of smaller companies. So I liked the way KBWP matched up when you do a correlation analysis of it with other stock funds. But I didn't like the fee associated with it. So, what I've done is created my own version of that. I've just taken the 10 biggest ones that are in that fund and invested in them individually. Surely you can't be serious.

Mostly Voices [15:41]

I am serious. And don't call me Shirley.

Mostly Uncle Frank [15:45]

Which is kind of an annoyance and a pain, and I'm not sure it's any better than just holding a small cap value fund, but I've done it anyway. But anyway, the real question is when do these things perform well? And the answer is they perform well in environments like we're having now. Where there is a lot of volatility in markets, there are threats of inflation. And so most of these companies are up for the year.

Mostly Voices [16:07]

I did not know that. That was weird, wild stuff.

Mostly Uncle Frank [16:11]

A more interesting question is why do insurance companies and financials in general do well in inflationary environments? And you can think about it pretty easily with respect to insurance companies because insurance companies are collecting money today, but their liabilities are some point down in the future. So inflation actually helps them be more profitable because they get the money now, but they don't have to pay it out until later when it is devalued. Cool. But anyway, you can see here that I'm already violating my own simplicity principle.

Mostly Voices [16:47]

That's not an improvement.

Mostly Uncle Frank [16:51]

Which I do from time to time because I'm just a curious person. Geez. And if you'd like to take a look at those, please do. I don't recommend you do what I'm doing because it is overly complicated and I'm not sure it actually makes a big difference in the end.

Mostly Voices [17:06]

You need somebody watching your back at all times.

Mostly Uncle Frank [17:10]

There is another insurance, a general insurance fund called KIE you may want to take a look at which also includes life insurers and other insurers beyond property and casualty. casually. But I will go ahead and put those in a correlation matrix in the show notes so you can just have a look at how those stack up against other commonly held funds. Now your second question about tail risk parity. Real wrath of God type stuff. Takes me off on another frolicking detour.

Mostly Voices [17:41]

You are talking about the nonsensical ravings of a lunatic mind. First let's talk about tail risk parity.

Mostly Uncle Frank [17:50]

This is a paper that I will link to in the show notes that came out in about 2014 by Alliance Bernstein, which is a fund company. And the idea, I think, as I read it, is that they would use futures and options contracts to somehow manage what we call the tail risk, which is what happens when markets crash. Unfortunately, I don't think they've been able to implement it in any reasonable way because it's very difficult to be using futures and options contracts to manage risk that way. So I'm not aware that there is any such thing, for instance, as a tail risk parity fund. There is a fund called TAIL, T-A-I-L, which holds volatility options, but it's not the same thing as this. So this is one of those things that looks great in theory, but is difficult to implement. But maybe somebody will be able to figure out how to implement it someday. It happened once. What was actually more interesting to me were the names on the front of this paper. One of them is Myron Scholes, the Nobel laureate who works with Alliance Bernstein. So what we're talking about here is quite legit, at least from a theoretical perspective. The other thing was the interesting quote at the bottom by another Nobel Prize laureate, this one, Philip W. Anderson, who was in solid state physics for his career. And he writes in this little quote, Much of the real world is controlled as much by the tails of distributions as by means or averages, by the exceptional, not the mean, by the catastrophe, not the steady drip, by the very rich, not the middle class. We need to free ourselves from average thinking. this guy is really important to me because he was one of the founders of what's called the Santa Fe Institute, which employs a lot of fractal mathematics and related subject matter, power laws, if you will, to all kinds of topics, including economics. But he's also the author of my favorite scientific paper from August 4th, 1972. It's called More is different, broken symmetry in the nature of the hierarchical structure of science. It's a short paper. I will link to it in the show notes. It's very famous. But in this paper, he attacks the idea of reductionism, the idea that we can reduce everything to simple components and then follow a simple set of rules that will apply to everything. He says that's wrong. Wrong! And the way things actually work is that you have layers where different rules apply in different domains. And so he makes those layers. At the bottom you have elementary particle physics, then you have mini body or solid state physics, which was what he worked in, then you have chemistry on top of that, then you have biology on top of that, and you go all the way up until you get to the social sciences. But in each domain, the rules are a bit different. And you can't just apply one set of rules to another domain and expect to have useful results. That's not how it works. That's not how any of this works. Otherwise you end up with something that is called quantum woo, which often you hear from people who are talking about human relations and they're saying they can apply quantum theory to human relations. And those are two different domains. The rules for quantum theory and small particles do not apply directly to any relations between human beings. But people often want to grab things out of physics and misapply them to other domains or other fields. Wrong! Wrong! And Anderson's point was that's not really how things work. That's not how any of this works. And so this paper was part of the development that led to the Santa Fe Institute, which was formed later. But one of my favorite things about this paper is the last part of it, where they quote Hemingway, or close to it. Anyway, it says, In closing, I offer two examples from economics of what I hope to have said. Mark said that quantitative differences become qualitative ones, but a dialogue in Paris in the 1920s sums it up even more clearly. F. Scott Fitzgerald, the rich are different from us. Hemingway responds, Yes, they have more money.

Mostly Voices [22:29]

You are correct, sir, yes.

Mostly Uncle Frank [22:33]

And to bring that full circle, it is true that depending on how much money you have, different rules or different strategies are going to apply to your how you manage your retirement portfolio. Because you're in different tax regimes if you're in the 0% capital gains tax bracket versus the 15% versus the 20%. And some product or idea which may be applicable to people in a certain range of wealth are likely to be completely useless or inapplicable to people in a different range of wealth. More is indeed different when it comes to managing retirement portfolios. But thank you for allowing me to go on that frolicking detour. Shut it up, you. Last off, we have an email from Adam, and Adam writes：hi, Uncle Frank.

Mostly Mary [23:30]

While Portfolio Visualizer and Portfolio Charts are great for backtesting numerous asset classes to the 1970s, I am curious about backtesting a risk parity portfolio for early retirement years. like 1929, 1937, 1965, 1966, and 1968, as big earn and others often reference as among the worst retirement cohort years due to the sequence of return in those starting years. I am not certain there are sources going back that far in all asset classes commonly associated with risk parity portfolios, though, as otherwise I'd expect it to already be in portfolio charts and portfolio visualizer. Big Ern uses much longer time frames in his datasets, but he is fairly limited with his asset class categories as a result, using mainly just US large cap stocks and intermediate treasuries. I read Ern's article about the benefits of adding 10-15% gold though, and it seems his estimate for the Golden Butterfly's performance going back to the 1920s was that in the worst year, which happened in the 1930s, A 4. 01% withdrawal rate preserved 25% of the initial portfolio's real value after 30 years. This result could be interpreted as good or bad, depending on if the retiree didn't mind portfolio depletion versus wanting to preserve more of their initial investment. But the 4% withdrawal rate certainly seems more bleak than the kinds of safe and perpetual withdrawal rates suggested by portfolio charts and portfolio visualizer due to not looking earlier than 1970. Anyway, do you think that there is any chance Portfolio Visualizer or Portfolio Charts could expand its data in the future to include earlier decades before the 1970s, or is the data perhaps just not there in enough asset classes for this to be viable? These are still fantastic tools, and I am just curious where the limits might be for simulating risk parity portfolios in earlier time periods. Thanks for all you do.

Mostly Uncle Frank [25:33]

Well, you are not going to find a lot of good data before the 1970s out of financial markets, and most of it is reconstructed in some way because a lot of the indexes and other things just did not exist in the past the way they do today. Interestingly though, if you go to Artemis Capital and read some of their papers over there, and one of them I linked to in earlier show notes, I'll see if I can dig it out about that Dragon Portfolio What Chris Cole actually has done is gone back and tried to reconstruct and do an a hundred year analysis of the portfolio he's constructing there. So it does include volatility and gold and managed futures. I'm not sure exactly how he did it, but it is there if you want to take a look at it. And what he found in those papers is that Assuming you can model this correctly, a much more diversified portfolio like we're talking about here, he uses risk parity as the sort of intermediate version of what he's doing. But his findings are that a much more diversified portfolio is more robust and just does better over time. And when you think about it, that's really the question we're trying to answer here is not what is the best portfolio in the world for all time, but simply can we construct better portfolios using things like the Holy Grail principle than our people are commonly using or are commonly available? And all data suggests that the answer to that is a resounding yes. Yes! But you do have to get outside of the boxes from what we call the bronze age of investing back in the 80s and 90s. when it was all about just constructing stock and bond portfolios of a 60/40 nature or something else. So I am doubtful though that Portfolio Visualizer or Portfolio Charts will ever come up with a reliable data set prior to the 1970s. It was actually hard enough to go back that far. But that may be more than good enough for a very simple but interesting reason, which is that Our currency system changed in 1971. In particular, the dollar was decoupled from gold. So we are actually in a different kind of investing regime now than you were in that prior era. If you were in that prior era, you would not really have invested in gold itself, because it was the same as investing in the dollar. What you would have invested in is gold miners. because they had a license to print money. And if you go back to a period like 1929 to 1932, the best performing stocks in the stock market were gold miners, and they were up something like 500% in that period, 500%. So if you had something like that in your portfolio, it would have saved you from everything. And finally on this question, I'll link back to a article that we just talked about in last episode, a Michael Kitces article about the 4% rule, and he does have data that goes back into the 19th century and basically says it's fine and that these newer reports trying to say that the 4% rule has changed and it should be 3.3 or something else are actually forecasting a future that has never happened in the past. So in the end, I agree with what Michael Kitces says, that making up catastrophic possibilities for the future is not a substitute for actually looking at whether that's those are assumptions are reasonable given what we know about the past. And I also agree with Bill Bengen, who says that Adding small cap value and some other things to the portfolio that he first analyzed back in 1994 seems to improve your safe withdrawal rate by about half a percent. But we don't need to beat that dead horse any more than the thrashing Michael Kitces just gave it last week. Although I'm sure it will come up again in the future. And thank you for that email. And now for something completely different.

Mostly Voices [30:01]

And the something completely different is our weekly portfolio

Mostly Uncle Frank [30:05]

reviews of the seven sample portfolios you can find at www.riskparadioradio.com on the portfolios page. You can't handle the gambling problem. We also have our monthly distributions to go through, which we just made this past week for February. Now, just looking at the markets last week, we saw the S&P 500 was up 1.55%. The Nasdaq was up 2.38%. Gold was up 0.92%.

Mostly Voices [30:37]

I love gold!

Mostly Uncle Frank [30:40]

Long-term treasuries had a bad week. They were down 2.43%.

Mostly Voices [30:45]

No, Mr. Bond, I expect you to die!

Mostly Uncle Frank [30:49]

Reits were up 0.07% as represented by the fund REET. Commodities represented by the fund, PDBC were up 1.92%. I think they're up 9% this year so far or something like that. Preferred shares represented by the fund PFF were down 0.81% for the week. Going through our portfolios, first one is the All Seasons portfolio, which is only 30% in stocks, 55% in treasury bonds, and then 7.5% each in gold, GLDM, and commodities, PBDC. It was down 0.50% for the week and is up 8.31% since inception in July 2020. We are withdrawing from this portfolio at a 4% rate divided into 12 months and so that comes out to $35, which we took from cash that had accumulated for February of this year. We have removed $630 total out of this since inception and it started with $10,200 in it in July 2020. Still has $10,418 in it. Alright, moving to our next three kind of bread and butter portfolios that are more akin to a retirement portfolio that you would want to hold. First we have the Golden Butterfly. This one is 40% in stocks divided into small cap value and a total stock market fund. It's got 40% in bonds divided into long and short treasuries and then 20% left in gold GLDM. It was up 0.07% for the week. It's interesting a lot of these portfolios didn't move hardly at all this week even with all the volatility of the markets. You can see that Having this broad diversification does make them often very stable in these sorts of markets.

Mostly Voices [32:49]

I'm putting you to sleep. It is up 18.

Mostly Uncle Frank [32:53]

77% since inception in July 2020. For the month of February 2022, we removed $46. We took it out of the gold because it has been doing the best recently. And we have taken out $875 from this since inception in July. 2020, we are withdrawing at a 5% annualized rate. And it still has $1,000 more in it than it started with. Next one is the Golden Ratio. This one is 42% in stocks, 26% in long-term treasuries, 16% in gold, 10% in a REIT fund, REET, and 6% in cash. It was down a whopping 0.05% for the week. again barely moving and it is up 18.85% since inception in July 2020. We are also distributing out of this at a 5% annualized rate which divided into 12 means $47 for February 2022 which we take out of cash out of this portfolio and replenish when it's time to rebalance. So we've taken out 877 from this since inception in July 2020 and it still has $11,000 left in it. Going to the next one, the Risk Parity Ultimate. I won't go through all of these 14 funds that are in this. It's our most diversified portfolio. But anyway, it was down also down 0.05% for the week. And it is up 17.16% since inception in July 2020. We're withdrawing from this one at a 6% annualized rate. So we will take $54 from the cash that is built up in it for February 2022. And we'll have taken out $1,032 total since inception in July 2020. And it has $10,684 in it right now. It started at 10,000 way back when. Going to our experimental portfolios, which have levered funds in them and so are much more volatile. Our first one is the Accelerated Permanent Portfolio. This one is 27. 5% in TMF, that's a leveraged bond fund, 25% in UPRO, a leveraged stock fund, 25% in PFF, that's a preferred shares fund, and 22.5% in gold GLDM. It was down 0.94% for the week. It was up 17.45% since inception in July 2020. We removed $71 from GLDM, the gold fund in it for February 2022 and distributed that. We are distributing out of this fund at an annualized rate of 8% to really put it through its paces. So we've taken $1,367 out of it total since inception in July 2020 and it still has $10,378 in it starting at $10,000. Now we go to the aggressive 5050, our most leveraged and volatile portfolio. It is 33% in UPRO, the leveraged stock fund, 33% in TMF, the leveraged bond fund, and then as Ballast, it has 17% in PFF and 17% in an intermediate treasury bond fund, VGIT. It was down 1.4% for the week. It is up 21. 76% since inception in July 2020. We are also taking out of this at a rate of 8% annualized. And so we took $75 out of the UPRO Leveraged Stock Fund for February 2022 since it's been doing the best. And we have taken out $1,405 since inception out of this portfolio. And it still has $10,771 left in it having started at 10,000. And our final portfolio, the lever to golden ratio, this one is 35% in a composite leveraged S&P and Treasury bond fund called NTSX. It's 25% in gold, GLDM, 15% in a REIT, Realty Income Corp, ticker symbol O. And then it's 10% each in a leveraged bond fund, TMF, and TNA, a leveraged small cap fund. And with the remaining 5%, we have a volatility fund, VIXM, at 3%. and 2% into crypto funds. It was down 0.03% for the week, the closest to flat. It is down 4. 47% since inception in July 2021. And so far we've distributed $312 out of it total. For this month we are doing $55 from GLDM, which is the best performer in January. It's interesting you can see the big difference at starting at a auspicious time like the middle of 2020 for the first six portfolios and then this one which started in the middle of 2021 has a much different experience so far. We'll see how that irons out over time. But most of the losses in this portfolio are actually attributable to the small cap fund. the TNA, which is based on the Russell 2000 index and has had a horrible run since last July. If it goes low enough by the middle of this month, we may be rebalancing into it, but we'll have to see if that plays out in accordance with our rebalancing plan. But now I see our signal is beginning to fade. If you have comments or questions for me, please send them to frank@riskparityradio.com that email is frank@riskparityradio.com or you can go to the website www.riskparityradio.com and put your message in the contact form and I'll get it that way. If you haven't had a chance to do it, please go to your podcast provider and like, subscribe, give it some stars, a review, That would be great. M'kay? Thank you once again for tuning in. This is Frank Vasquez with Risk Parity Radio. Signing off. Guess what? I got a fever.

Mostly Voices [39:13]

And the only prescription is more cowbell.

Mostly Mary [39:17]

The Risk Parity Radio Show is hosted by Frank Vasquez. The content provided is for entertainment and informational purposes only and does not constitute financial, investment, tax, or legal advice. Please consult with your own advisors before taking any actions based on any information you have heard here, making sure to take into account your own personal circumstances.