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 foundational episodes for this program. And those are episodes 1-3-5-7-8. and nine. One of our listeners, Karen, has also reviewed the entire catalog and has additional recommendations as foundational episodes. Ain't nothing wrong with that. And Karen's recommendations are episodes 12, 14, 16, 19, 21, 56, and 82, in addition to the first five that I mentioned. Now, I realize women named Karen get a bad rap these days, but I assure you that all of our listeners are intelligent, thoughtful, and savvy. Yes! And don't forget that the host of this program is named after a hot dog. That's not an improvement.

Mostly Voices [1:41]

Lighten up, Francis.

Mostly Uncle Frank [1:45]

But now onward to episode 204 of Risk Parity Radio. Today on Risk Parity Radio, we're going to do something that I know some of you like, which is to go off topic in response to a listener question. But fortunately, this particular topic applies to all of us, whether you like it or not. So we will only be having one email today. And so without further ado, here I go once again with the email. First off, second off, last off. First off, second off, and third off. We have an email from Charles.

Mostly Mary [2:34]

And Charles writes, hi Frank, long-term investing and keep a long-term view on investments is what I most hear in the financial industry and podcasts all over the place. I feel like nobody speaks to me. I'm a 63 year old who has been diagnosed with a terminal illness. I have five years tops. Long term for me is that. I love investing, but my world is turned upside down with this, and I also don't have any family worth leaving money to. Any thoughts on short term investing for someone like me, other than the obvious ones such as keep everything in cash and short term bonds? I prefer more of a swing trader or even a day trader approach.

Mostly Uncle Frank [3:14]

Well, first let me say that this is one of the best questions I've ever received on this program. And I consider it an honor, a great honor, when somebody comes to me with a question and says, I don't know where else to turn. So I've done my best to construct the best answer that I could. given what I know. But let's start with the big picture here. And of course the big picture here is the end of life process or dying. I know a lot of people don't like talking about that, which is a pity because we ought to talk about it more. I like to talk about the things other people don't like to talk about. Inconceivable. Money, finances, and dying. and have spent a considerable amount of time being with people or around people who are dying and reading about the process. And so we'll start with the book recommendations. The first is a set of small books or booklets from a woman named Barbara Karnes. And Barbara Karnes is a hospice nurse who has spent decades in that field with people going through the dying process and with their families. And so she wrote a set of books called the End of Life Series, which consists of five little books. First one is called A Time to Live：Living with a Life-Threatening Illness. Second one is called Gone from My Sight：the Dying Experience. Third one is called the Eleventh Hour：A Caring Guideline for the Hours to Minutes Before Death. Fourth one is called Pain at the End of Life：what yout Need to Know About End of Life Comfort and Pain Management. And the last one is called My Friend I Care：the Grief Experience. And I'll link to this in the show notes. You can buy them all as a package together for about $13. So I think the first one and the third one are going to be of the most interest to you. The first one, A Time to live, living with a life-threatening illness. It's for the newly diagnosed facing a life-limiting illness and addresses issues of comfort, nutrition, and sleep as they relate to palliative care. This book provides guidance to help you live the best life you can within the confines of your body and your disease. The third book actually describes what it is like to die, what the experience is like at the end of life. The second one is actually the most famous one. It's also known as the Hospice Blue Book. But it's not for the person who's dying, it's for their family members or their other loved ones who will be experiencing it with the dying person. And so if you really want to be on top of this from a nuts and bolts perspective, which I think you should want to be on top of, I highly recommend that you pick these books up. They're not very long and they are very informative. My second recommendation is a book that is, I think, the best book about dying that I have ever read because it relates it back to living. And a question that we don't often ponder enough, which is knowing that we are dying, we are all dying, how does that inform and help us live better lives? The name of this book is the Five Invitations：Discovering what Death Can Teach Us About Living Fully. And it is written by a man named Frank Ostaseski, who has run a Zen-based hospice for several decades and has accompanied thousands of people to their deaths. But more importantly, has been there as these people have been dying. The first of the five invitations is entitled Don't Wait. And the idea is instead of pinning our hopes on a better future, we focus on the present and being grateful for what we have in front of us right now. The second invitation is entitled Welcome Everything, Push Away Nothing. And the theme of that is that in welcoming everything, we don't have to like what is arising. It's actually not our job to approve or disapprove. When we are open and receptive, we have options. We are free to discover, to investigate, and to learn how to respond skillfully to anything we encounter. The third invitation is entitled Bring your whole self to the experience. And the idea of this is that we all long to be seen as capable, strong, intelligent, sensitive, spiritual, or at least well adjusted. We like to project a positive self-image. Few of us want to be known for our helplessness, fear, anger, or ignorance, or that sometimes we are more of a mess than we'd like to admit. To be whole, we need to include, accept, and connect all parts of ourselves. Wholeness does not mean perfection. It means no part left out. The fourth invitation is to find a place in the middle of things. And the idea of this is that we often think of rest as something that will come to us when everything in our lives is complete. At the end of the day when we take a bath, once we go on a holiday, or get through our to-do lists. We imagine that we can only find rest by changing our circumstances. This place of rest is always available to us. It is a choice. A choice to be alert to bring your full attention to to this moment. And the fifth invitation is to cultivate a don't know mind. What does that mean? It doesn't mean being ignorant. What it means is cultivating a mind that is characterized by curiosity, surprise, and wonder. It is receptive, ready to meet whatever shows up as it is. A don't know mind is an invitation to enter life with fresh eyes to empty our minds and open our hearts. Now I will also link to that book in the show notes. Many people also like to listen to that as an audio book and find it interesting and comforting. He goes through those five invitations and then talks about many, many people as examples, people who are dying and how this has applied to them. And that is really what makes this the best book about dying that I'm aware of, because it's so visceral and how it relates dying back to living better. And our third recommendation is the New Kid on the Block, a book called Taking Stock by Dr. Jordan Grumet, also known as Doc G, who hosts the Earn and Invest podcast. And he is also a hospice doctor who has accompanied many people to their deaths. and writes a book that relates that back to personal finance. And again, the best part about that book is the examples of the people that he has accompanied to their deaths and what they thought about and what was important to them at the end of their lives. And to that end, I'd like to give you now three stories or vignettes of people who are diagnosed with terminal illnesses and how they dealt with it. The first one is a person that Doc G described in that book taking stock, and I believe he refers to the person as Sam. And anyway, Sam was diagnosed with, I believe, a terminal cancer and decided early on after he was diagnosed that he really was not going to fight the diagnosis. and accept that he was going to die relatively soon and that it was kind of unpredictable as to when it would likely occur. And so instead of focusing on treatment, he focused on all the things that he hadn't done in his life that he wanted to do. One of those was travel. And so he was constantly traveling, even as he was dying, and going to places all over the world and having the kinds of experiences Going to festivals and other things like that that he really wanted to experience. These are the days we've been waiting for.

Mostly Voices [11:48]

On days like these, who could ask for more? Keep on coming, 'cause we're not done yet. These are the days we won't forget. These are the days we won't forget. And so he had a grand finale to his life.

Mostly Uncle Frank [12:08]

And when he died and his family found him, he died in bed one night, and they also found his bags packed and ready to go on his next journey right there with him. And so the lesson there is if there is an experience that you want to have, don't wait. Go ahead and do it. And if the experience you want to have is to be a short-term trader in this case, which we'll talk a little bit more about later, then I suggest you dive right into that.

Mostly Voices [12:40]

Yes!

Mostly Uncle Frank [12:44]

Get those multiple screens, set up that trade station in your house or wherever, and have at it. Now the second person I'd like to tell you about is a person from our extended family, a man named Justin. My niece, Christina, first met Justin about 10 or 15 years ago when she moved to Alaska. And Justin was one of these people who loved the outdoors and was kind of the outdoorsman's outdoorsman. He was a rock climber, an ice climber, a downhill skier, he played hockey, and he also climbed mountains, which included two of the seven summits, the ones in North and South America, which are Denali in Alaska and Aconcagua in Argentina. And he and Christina became friends when she first moved there and then started dating about eight years ago and eventually moved in together. And they spent much of their time in the wilderness, camping and climbing on things. And they had some pretty fantastic adventures just by themselves that most people never experience. In 2020 or 2021, Justin was training for a half Ironman and started experiencing blackouts and headaches and problems of that nature. He was otherwise completely healthy at the time and in his early 40s. He went and got diagnosed and was diagnosed with a glioblastoma. which is a form of brain cancer. And you may have heard of it because it is the same kind of cancer that killed John McCain, the senator. Now that kind of cancer is almost always terminal and Justin was given two years to live, max. So what did they decide to do? Well, of course, he and Christina went to some of their favorite places. But the major thing they also decided to do was to get married, which was always something they had in the back of their heads, but they didn't want that to interfere with their adventures. So on August 7th, 2021, we all trekked up to Juneau, Alaska to witness their wedding. And it was a beautiful wedding held at the Eagle Crest Ski Lodge near Juneau. And they were married by a friend of theirs, with all of us witnessing, and everything was perfect. From the formal wedding attire down to the rain boots the entire bridal party was wearing because it was very muddy where they were getting married. And so it was a very Alaska experience and we all had a great time. Most importantly, there was nothing somber about it. It was a very joyous occasion, like most weddings. And on June 20th of this year, about 10 months after they were married, Justin died of the glioblastoma. And Christina became a widow in her late 30s. And when I look back on the experience, particularly of the wedding, looking at the pictures and the video I took of them exchanging their vows, I realized that is one of the best things that they could have done. And although it didn't really feel like it at the time, it was effectively like having a wake while you are still alive. So the lesson you should get out of that is that if you have an opportunity to have a celebration of life or family or something else, it doesn't really matter what it is, you ought to go after that. Because that's how we're all going to remember Justin that day, especially those of us who did not know him that well, as a happy groom with his happy bride. And I know it gave both of them great satisfaction and just a feeling that they had done what they needed to do or wanted to do at that moment in time. Now, my third story I'd like to tell you comes from Paul Merriman. At some point recently, Paul Merriman listened to one of my podcasts and then contacted me about a month ago and we had a very nice telephone conversation. And he's a kind and generous man. Of course, we talked mostly about small cap value funds.

Mostly Voices [17:18]

I'm telling you, fellas, you're gonna want that cowbell. I gotta have more cowbell. I gotta have more cowbell. But that's for another podcast.

Mostly Uncle Frank [17:27]

He did ask me if there was something that he could do for me. And since he's about 20 years older than I am, I thought that I would ask him your question and see if he had had any experience with something like that. And he told me a story of a friend of his back in 2014 who had contracted a terminal illness, I think it was some form of cancer. I want to say it was pancreatic cancer, but I don't remember that explicitly. But anyway, when Paul found out about the diagnosis, they went ahead and did a lot of the bucket list kind of things that you might want to do. I believe he described a fishing trip together, but again, my memory would be faulty. Now, how does that story end? The answer is it doesn't. His friend is still alive eight years later. And Paul's point was, be careful because you don't necessarily know if your prognosis is correct as to how long you may live. And I would imagine that it varies substantially depending on what sort of illness that you have. But I'm not a doctor, so I can't tell you anything about that. You have more chance of reanimating this scalpel than you have of mending a broken nervous system. But if I were you, I would do some research into longevity statistics for people with the same kind of illness that you have contracted. Because your life tunnel may be longer than you think or have been told. And obviously you don't want to run out of money while that's still going on. But now I'm going to get to the specifics of your question. Charles. But before I got to that, I just wanted to say for the rest of us in the audience, actually estimating when we might die is an important part of financial planning. I think it's a neglected part of financial planning. But an educated guess is better than not trying at all. Some of the ways you can do that is by looking at family longevity, obviously. But there are also little questionnaires and things you can fill out online that will give you estimates of your likely terminal age, given your habits and other circumstances. And I'll link to those in the show notes. The other thing you may want to test yourself on is something called the Sit-Rise Test, devised by a Brazilian doctor. And I'll link to a YouTube video about that in the show notes. But the test is to sit down on the floor from a standing position and then get up again. And you start with 10 points and you lose them depending on whether you lose your balance or have to use your hands or other kinds of support to get yourself back up again. But it has proved to be a very good estimator for longevity. You can get more details in the YouTube video. Okay, now to your specific question. I'm assuming that you want to get involved in trading because it's something you always wanted to do. And for the curiosity, experience, and excitement of it. I always go back to that movie Trading Places when I'm thinking about trading. Well, this is it. The last bastion of pure capitalism left on Earth. Here in New York, they trade everything. Gold, silver, platinum, heating oil, propane, cocamand sugar, and of course frozen concentrated orange juice. But those kind of open floor exchanges don't even exist anymore.

Mostly Voices [21:18]

Not yet. Almost. 220 take them. 209. Yeah, got them. No. South on April 142.

Mostly Uncle Frank [21:35]

what we see more is the multi-screen trading station setups that many traders have in their offices or homes. Now to learn about this, I probably would go to a site called shadowtrader.net And there's a guy there named Peter Reznikov who trades options in a very meticulous way involving lots of different kinds of charts. And he used to do weekly videos, but stop that recently. I will link to one of those in the show notes so you can check that out. But to me that looked to be a very interesting way of trading because of all the different ways of structuring options trades. with names like Condors and Broken Butterflies and all sorts of other spreads. And so to me, if I was going to sit down and spend my time doing that sort of thing, that is the sort of thing I would look to. There is also another resource called Tasty Trade, which teaches all about futures and options that might be of some interest to you. I'll link to that in the show notes as well. You may also want to look into what big earn at early retirement now does in his personal portfolio. He holds the bulk of it in municipal bonds and preferred shares and other relatively inert things, and then is trading S&P futures options on a weekly basis. And I'll see if I can link to one of his descriptions in the show notes. But that's also another viable approach you might take. if you're interested in doing that. Which leads me to the portfolio construction point, which is this. Typically, if you're going to have a highly volatile or risky part of your portfolio, you're going to want to adopt a barbell strategy where the rest of your portfolio is relatively inert. It's also how professional gamblers tend to operate. They have most of their money just sitting in treasury bonds or a savings account, and then they are using a small portion of it at a time to play with and take big risks with, knowing that they could lose that entire portion in one session. So that would mean that most of the rest of your non-trading portfolio would be in things like short-term bonds. a short-term bond fund like SHY or I Bonds or anything else that's not likely to be very volatile. You should also look into something that's called the Kelly Criterion because that tells you how much of your overall portfolio that you would want to risk on one trade. And again, the idea of that is to avoid what's called Gambler's Ruin. where you just had bad luck on a particular trade, you don't want it to ruin you. And I'll see if I can find a link to something about that in the show notes as well. If you want to read about famous traders and trading, I would pick up Jack Schwager's Market Wizards books. There are four or five of them now in the series. So look up Market Wizards and you'll find those. And those are all books with a series of chapters about traders and what they do. Each chapter features an individual trader. Another book I liked from a famous trader and autobiography was Ed Thorp and his book is called A Man for All Markets. And he is also famous for developing the first methodology for card counting in blackjack. You have a gambling problem. and has some fascinating tales to tell. So that's all I've got for you right now, Charles. I hope some of that helps in some way. And if you have other questions, please send them in. Remind me of which Charles you are, and I will move them to the front of the email queue. And thank you very much for this email. But now I see our signal is beginning to fade. I wanted to remind our audience that we have a promotional activity going on this Saturday for our charity, the Father McKenna Center. So any of you who are in the DC area and want to come down to North Capitol Hill at 19 I Street or I Street, Wood-Meet North Capitol Street, that's where we'll be. We will be doing a walk for McKenna, the sixth annual walk for McKenna to raise money for the center. There will be t-shirts and food and fun. And please let me know if you are coming by sending me an email or a message. I will again link to that registration link in the show notes. Now aside from that, 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 into the contact form and I'll get it that way. If you haven't had a chance to do it, please go to your favorite podcast provider and like, subscribe, give me some stars or review. That would be great. Okay. Thank you once again for tuning in. This is Frank Vasquez with Risk Parity Radio signing off.

Mostly Voices [27:27]

These are the days we've been waiting for. Now the reverse knows what's in store. You just throw your window down and place your bets. These are the days we won't regret. These are the days Ways we'll never forget.

Mostly Mary [27:47]

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.