Voices [0:00]

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

Mostly Queen 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 the basic foundational episodes are episodes 1, 3, 5, 7, and 9. Yes, it is still in my memory banks. We have also created an additional resource, a collection of additional foundational episodes and other popular episodes.

Voices [1:07]

We have top men working on it right now. Ooh.

Mostly Uncle Frank [1:14]

Top men. And you can find those on the episode guide page at www.riskparody radio.com. Inconceivable. All thanks to our friend Luke, our volunteer in Quebec. Zachosh. We'd be helpless without him.

Voices [1:35]

I have always depended on the kindness of strangers.

Mostly Uncle Frank [1:41]

Because other than him, it's just me and Marion here. I'll give you the moon, right?

Voices [1:46]

I'll take it.

Mostly Uncle Frank [1:48]

We have no sponsors, we have no guests, and we have no expansion plans.

Voices [1:52]

I don't think I'd like another job.

Mostly Uncle Frank [1:55]

Over the years, our podcast has become very audienced focused. And I must say, we do have the finest podcast audience available.

Voices [2:03]

Top drawer. Really top drawer.

Mostly Uncle Frank [2:07]

Along with a host named after a hot dog.

Voices [2:10]

Light in the French.

Mostly Uncle Frank [2:14]

But now onward, episode 476. Today on Risk Party Radio.

Voices [2:20]

Merry New Year!

Mostly Uncle Frank [2:22]

Yes, it's a Merry New Year indeed. So what we'll be doing today is our annual portfolio reviews of the eight sample portfolios you can find at www.riskparty.com on the portfolios page.

Voices [2:44]

Happy New Year! And I have to say it was a very good year. It was a very good year.

Mostly Uncle Frank [3:10]

So if you like numbers and details, this is the podcast episode for you. And if you don't, I apologize in advance.

Voices [3:19]

This is pretty much the worst video ever made.

Mostly Uncle Frank [3:22]

Most or all of this material is also posted to the website now, if you want to check out the details for yourself. But before we get to that, just to reflect on the bigger picture of what's going on in personal finance space, at least all the podcasts and stuff I listen to. This past year seems to have been a big recognition year that the problem in personal finance as to retirement, and I'm talking about people that are otherwise prepared for retirement, is that people are not spending enough money.

Voices [4:03]

That's the fact, Jack! That's the fact, Jack!

Mostly Uncle Frank [4:07]

And we heard this same message from all kinds of different people this year when Bill Bangin was out touring his new book about the research he's done about safe withdrawal rates. His main comment was that people aren't spending enough money and that if they took a better approach and had a better portfolio, they could and should spend more money in retirement. And he said he was diligently trying to pass it on to his children before he expired because they could use it now and not later. We heard from Michael Kitsis and Carl Richards on their podcast, Kitsis and Carl, talking about the problem of underspending, which they attributed to a character they called, quote, frugal Bob, unquote, who basically had acquired such an identity as a saver, he was unable to change that, and being frugal Bob was more important than actually enjoying what he had accumulated.

Voices [5:02]

You're never home. You talk to your trucks more than you do me. You never even touch me anymore, Bob. I just can't do this. Wendy, can we fix it? No, we can't.

Mostly Uncle Frank [5:15]

There was also an anxious Sally involved in that. But they identified identity and fear as the two biggest problems, with identity being the main bugaboo, if you will, here. Morgan Housel said similar things in his book The Art of Spending Money, which came out in October. And there is a whole chapter in that book on the issue of identity, where he says that one of the most dangerous identities you can take into retirement is the identity of, quote, I am a saver, unquote. Because it ends up representing misplaced priorities and tends to interfere with relationships and the things that are really important or that people say that are really important at the end of life.

Voices [6:01]

Then you no longer love me. You no longer love me. When have I ever said that? In words, never. By what then? In the way you have changed. But how have I changed towards you? By changing towards the world. But it's it isn't such a terrible thing for a man to struggle with something better than he is. Another idol has replaced me in your heart. A golden idol. It's singular. The world who can be so brutally cruel to the poor professes to condemn the pursuit of wealth in the same breath. You fear the world too much. With reason. But I I I I am not changed towards you. Aren't you?

Mostly Uncle Frank [6:37]

And David Bach has also resurfaced. That's the author of things like the Latte Factor and Automatic Millionaire from about 15, 20 years ago. He is now early retired in Italy in his 50s, and is saying that one of the biggest problems is this underspending problem, and that something like over 80% of U.S. retirees fail to even touch their traditional retirement accounts prior to being forced to take money out due to RMDs in their 70s. Surely you can't be serious.

Voices [7:11]

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

Mostly Uncle Frank [7:13]

And he identifies this as the symptom, a big symptom of a greater problem that people who have otherwise prepared well for retirement are unable to execute when it comes time to actually spend the money.

Voices [7:26]

Ha ha, you fool! You fell victim to one of the classic blunders.

Mostly Uncle Frank [7:30]

And his message is we ought to focus on doing something about that. Although he does plan to stay retired and does not plan to be writing any more books, at least according to what he said in recent interviews.

Voices [7:41]

I don't think I'd like another job.

Mostly Uncle Frank [7:44]

So I feel like people are finally getting the memo. Did you see the memo? At least some people. I can't speak for the Bogleheads. They're still off playing around with tip sliders these days.

Voices [7:57]

Hearts and kidneys are tinker toys.

Mostly Uncle Frank [8:01]

But I've been thinking about this way for at least ten years or more and talking about it publicly for more like the length of this podcast, which has been since 2020. But I had been surprised at first by the resistance to the idea of just constructing better portfolios to have a better safe withdrawal rate. It seemed like a no-brainer and something that most people would want to do. But what I've recognized since then is most people are looking for reasons to not spend money. And so if they are given basically a way of doing that, the reaction is one of cognitive dissidence and various forms of denial.

Voices [8:41]

I know you are the way to mine, I know you are the one of mine, I know you are the one of mine, I know you are the one of my infinity.

Mostly Uncle Frank [8:48]

But it's kind of hard to deny it all now since we have Bill Bang and the father of the 4% rule coming out and saying that's exactly what we should be doing in a book. So I'm glad people are coming around to my way of thinking.

Voices [9:04]

Come around to my way of thinking. What's with you anyway? I can't help it. I'm a greedy slob. It's my hobby. Save me!

Mostly Uncle Frank [9:41]

But I think the importance of this and why it really matters was brought home to me again last month. I had a listener reach out to me to tell me that he had just been diagnosed with a terminal illness and probably had between six months and two years to live. And he was hoping that I could help him with a couple of things. And I don't want to say any more about that right now to preserve his privacy. But the truth is that could be any one of us, particularly after age fifty, because our chances of dying in the next ten years begin to go up exponentially after age fifty, particularly for men, but women catch up pretty quickly too. But it reinforces the reality that once we get to retirement ages, we really should be focusing on what's going on in the next ten years of our life, because that may be all the life we get.

Voices [10:33]

The moon is broken and the sky is cracked. Come on to the house. You gotta come off to the house.

Mostly Uncle Frank [11:16]

And not making our decisions primarily based on what's gonna happen after we're dead or what's gonna happen right before we're dead. And what are we gonna be doing in our 90s because most of us are not going to live into our 90s?

Voices [11:46]

You got to come on.

Mostly Uncle Frank [11:52]

But all of us only have one shot at this, so we ought to make it our best shot and make sure we're making rational decisions based on real values and goals, and not being frugal Bob or anxious Sally or any of those characters. The SP 500 represented by the fund VOO is up 17.82% for 2025. The NASDAQ, represented by QQQ, the Nasdaq 100, was up 20.77%. Small cap value represented by the fund VIOV was up 6.62%. And now let's take a little detour to talk about international funds because the international sector greatly outperformed the U.S. this year. But as I've been saying, that is primarily due to the weakness in the US dollar. The US dollar was down about 10% against foreign currencies on the year. And when you see that, it is likely that international stocks will outperform by at least 10%, and that's what they did last year. So a total international stock market fund like VXUS was up 32.35% for the year. And a domestic Chinese fund like KBA was also up 33.85% for the year. But you really got the most bang for your buck if you were looking at international funds by focusing on factor diversification before you focused on international diversification. So an international small cap fund like AVDV was up 49.57% for the year, and an international momentum or large cap growth fund like IDMO is up 44.06% for the year. And what that really tells you is that if you are looking at international funds to diversify from the US, do not just blindly go to some total international fund like VXUS. It's not as diversified from your US funds and it will not perform as well because it is larded full of a bunch of banks and things like Nestle.

Voices [14:53]

Do you want a chocolate?

Mostly Uncle Frank [14:55]

So when you are doing your diversification among stock funds, focus on factors first and location second. Moving on. The big winner, of course, this year was gold. GLDM was up 64.2% for the year of 2025.

Voices [15:12]

I love gold.

Mostly Uncle Frank [15:16]

Long-term treasury bonds represented by the fund VGLT were up 5.34% for the year. And that is actually kind of a textbook performance for bonds over time. Being up somewhere between 4% and 6% is pretty standard. What you will find of interest last year, if you're interested in the yield curve itself, is because the yield curve is now normalizing since they've been reducing the Fed funds rate. Intermediate treasury bonds actually outperformed long-term treasury bonds and strips funds because the outer part of the curve just didn't move that much at all. Whereas interest rates dropped more significantly for the 10-year and shorter durations. Moving along, wreaths represented by the fund, REET were up 7.97% for the year. Commodities represented by the fund, PDBC were up 5.91% for the year. Commodities were an interesting area this year because the metals went up a lot, both industrial and precious metals, but most of the other commodities didn't do much at all. Agriculturals and energy kind of wallowed or went down. I think a lot of soybean farmers are going bankrupt in Iowa these days. Moving on, preferred shares represented by the fund PFFV were up 2.08% for the year. And so they kind of performed like a long-term bond, which they often do. And finally, managed futures represented by the fund DBMF were up 13.84% for the year. Now that is also interesting because DBMF happens to be one of the best performers in that asset class. Many other funds were either down slightly or only up single digits. But DBMF is the closest thing to an index fund in that category right now. There are other funds that came online. Just in this past year, both Fidelity and BlackRock iShares introduced funds. ISMF and F F U T came out in the spring and they actually perform pretty well after that. But I think that's where this category is going. There are going to be more index fund like products at relatively lower fees to be using in the future, which is all good for us DIY investors.

Voices [17:37]

That is the straight stuff, O Funkmaster.

Mostly Uncle Frank [17:41]

Now moving to these portfolios. First one is this all seasons portfolio. This is this reference portfolio that Ray Dalio gave to Tony Robbins when he wrote the book Money Master the Game over 10 years ago now, as kind of a simplified risk parity style portfolio without leverage, is how you'd really describe it. And it's really too conservative for most purposes. But just going over the stats, first it is 30% in a total stock market fund, VTI we use for that, 55% in intermediate and long-term treasury bonds. That's in 40% VGLT and 15% VGIT. And then the remaining 15% is divided into golden commodities, GLDM and PDBC in this instance. It was down 0.65% for the month of December, but it's up 13.55% year to date and is up 23.27% since inception in July 2020. And so right now it has $10,111 in it. And it's basically covering its distributions, but really not much more. We're withdrawing from it at a 4% annualized rate. So for January, just to go over the rest of these, we'll be distributing $34 out of cash, accumulated cash. All of these have accumulated cash in them now with the year-in distributions. So that'll be $34 year to date for the year of 2026 and $2,108 since inception in July 2020. So I selected some comparison funds to compare this on a risk-adjusted basis. So since this is only 30% in stocks, you needed to look at something that has a similar allocation to stocks. And something like that would be something like the Vanguard Wellesley Fund, VWIAX, which is 30 to 35% in stocks and the rest in bonds. That fund was up 11.09% for the year. So you can see the all seasons did a bit better than that. And that undoubtedly was due to the exposure to gold in particular. But this kind of portfolio would only be used by the most conservative of investors. There's another fund that you might compare this to as well. And some of our listeners had asked me about this in the past. It is a fund under the ticker symbol BLNDX, which is the Standpoint Multi-Asset Fund Institutional Class by Eric Crittenden. And that is a very well diversified portfolio that uses things like managed futures, but its idea is to come up with a conservative return of generally between 5 and 10%. That fund only returned 4.12% this year. And to me, that shows you that having something that is much more complicated like that, and it does have a high fee of over 1%, probably doesn't make any sense when you can just construct something simpler like an all-seasons kind of portfolio. But you'll see this as repeatedly the difference between what we're doing here as do-it-yourself investors in doing simplified versions of risk parity style portfolios and not having all of the complications that some of these commercial products have, because they really aren't that necessary to get the same kind of results, and you can really save on the fees if you do this yourself, which we can do now pretty easily with all of these ETFs that we have available. So moving now to these kind of more bread and butter kind of portfolios that you might actually use some kind of version in a retirement scenario because these portfolios tend to have higher safe withdrawal rates. The first one is the golden butterfly. This is Tyler's portfolio from portfolio charts. It is 40% in stocks divided into a total stock market fund, VTI, and a small cap value fund. Here we're using VIOV. Well, you probably should use A V U V in real life. We just took the index version here. It's got 20% in long-term treasury bonds, VGLT, 20% in short-term treasury bonds. That's SHY in this portfolio. Could be VGSH if you wanted to use that. And it's got 20% in GLDM, which is gold. So it's up 0.36% for the month of December. It's up 19.13% for the year of 2025, and up 59.55% since inception in July 2020. It now has over $12,000 in it, $12,198. We have distributed $2,914 out of it since inception in July 2020, and we'll be distributing $51 out of it from cash for January of 2026. It's at a 5% annualized rate based on the current monthly balance. We'll look at the next one first before we look at the comparison funds. The next one is the golden ratio portfolio. The golden ratio. The golden ratio. It's got 26% in VGLT, which is a long-term treasury bond fund, 16% in GLDM, that's a gold fund, and 10% in DBMF, that's a managed futures fund. It's also got 6% in cash that we take the distributions out of. It's in a money market fund. I can tell you in my own personal life, I would take that 6% and actually allocate it to international stock funds. And it performs better that way, believe it or not. Not hard to believe since cash does not do much for any portfolio.

Voices [23:30]

There's $250,000 lining the walls of the banana stand.

Mostly Uncle Frank [23:35]

And I use AVDV and IDMO, if you're wondering. So this one is up 0.13% for the month of December. It's up 18.81% year to date and up 54.4% since inception July 2020. It has $11,780 in it currently. And we have distributed $2,852 out of it since Inception July 2020. We'll be distributing $49 out of the money market fund for January 2026. It's at a 6% annualized rate. You can see its performance was very similar to that of golden butterfly, which is not surprising. But the golden butterfly outperformed this year mostly because it has more gold in it. Over time, you would expect this one to outperform the golden butterfly simply because it's got more risk assets in it and less cash or short-term bonds. But in any given year, either one could be the leader. In any case, they were both up about 19%. Now, what would we compare this to? Well, there are a few basic kind of index funds you could compare this to. One would be a simple 60-40 portfolio, and we can represent that with VBIAX, which is Vanguard's balanced fund. And that one was up 13.61% compared to our 19%. And those both have similar risk profiles. The difference was all in the alternatives this year. If you look at something like Vanguard's Lifestyle Fund, that is also a kind of a 6040 mix, but it's got some international exposure to it. That fund is VSMGX. That one was up 16.24%. Did better than the standard 6040 portfolio because of its international exposure. But again, did not do as well as the golden butterfly to the golden ratio because it does not have an exposure to something like gold. Another point of comparison there would be the Vanguard Wellington Fund, which is also a 6040 or a 6535 kind of portfolio. That's VWENX. That one was up 16.57% for 2025. And so also underperformed the golden butterfly and golden ratio portfolios. I should say the golden butterfly has less risk in it than these funds. And the golden ratio has a similar risk profile. I suppose the next question is well, is it surprising that gold had an outperformance year that contributed to these funds doing better than the kind of standard 60-40 type funds you might hold? And the answer is, well, it's unusual, but it's not that unusual. It's happened before. It will probably happen again. I think part of the problem is that places like Vanguard do not have a good model for returns for something like gold. And in fact, they tend to use models that say that gold has a 0% return and will only keep up with inflation over time. That really has not been true for the entire time that gold has been tradable. And you can look this up yourself, but if you look at gold's performance since it became tradable again in the 1970s, it's up now, I think, 8% as a compounded annual growth rate, and it has a standard deviation similar to that in the stock market. So if you have a model that says that gold is only going to yield 0 to 2% like Vanguard has, that's just a bad model.

Voices [27:13]

That's not how it works. That's not how any of this works.

Mostly Uncle Frank [27:17]

And doesn't account for things like the demand for gold from central banks and other people outside the US that don't want to hold dollars or would rather hold gold. So if you're one of those people or dealing with one of those people that thinks that the 1970s was so unusual for gold it could never repeat, guess what? You found out this year you were wrong.

Voices [27:37]

Wrong! Wrong!

Mostly Uncle Frank [27:39]

But you shouldn't be surprised you were wrong because the model you were using was not very good to begin with.

Voices [27:44]

Forget about it.

Mostly Uncle Frank [27:46]

You don't get to start the time series for gold from 1980, which some of you like to do because that's when gold hit an interim high. But that's just bad use of data and cherry picking the data.

Voices [27:59]

Forget about it.

Mostly Uncle Frank [28:01]

It's the kind of thing people do when they've already decided they don't want to incorporate something like gold into a portfolio, and then they run around looking for reasons to justify the decision they've already made, as opposed to looking at the evidence and then making the decision. Their reasoning is just backwards.

Voices [28:20]

It's a write-off for them. How is it a write-off? They just write it off. Write it off what? Jerry, all these big companies, they write off everything. You don't even know what a write-off is. Do you? No, I don't. But they do. And they're the ones writing it off.

Mostly Uncle Frank [28:41]

Now, how do these compare with other risk parity portfolios? And there are more of them out there. There's one from Bridgewater and iShares now called ALLW, but it hasn't been out for a year, so we can't really compare it. The oldest one on the market is from AQR. It's AQRIX. And AQRIX is a complicated multi-asset portfolio, and it was up 18.13% for the year. So pretty similar to what we've achieved, but they would be almost the same if you didn't have to pay for AQR-IX's fee. Which is the point I'm making that we can do a lot of this stuff by ourselves with simplified portfolios that perform pretty much similar just as well. Now, Fidelity's risk parity style portfolio did outperform this year. That is F-A-P-S-X, and that was up 21.28% for the year. And that's due primarily to its gold exposure, but also due to some of its other international stock exposure. But again, that is a more complicated portfolio than what we are dealing with. Our only point in comparing these is to show that we can do just as well with do-it-yourself versions that are less complicated. And this is where the simplicity principle actually works. Make things as simple as possible, but no simpler. But now let's move on to our next sample portfolio, the risk parity ultimate. This one has 12 different funds in it. It's kind of our kitchen sink, but if you look at commercial risk parity style portfolios or multi-asset portfolios, they will often look something like this with 12 different assets in them. Just going down the list since I do it so infrequently. On the stock side, this has 10% in VUG, that's a large cap growth fund. It's got 15% in VIOV, it's a U.S. small cap value fund. It's got 5% in USMV, which is a U.S. low volatility fund. It's kind of like a large cap value. It's got 5% in a REIT fund, R-E-E-T, 5% in KBA, which is the Chinese shares fund. And the best of all these stock funds last year was up about 33%. And then 5% also in UPRO, which is a three times levered S P 500 fund. On the bond side of this thing, we've got 20% in GovZ, which is a Treasury strips fund. We've also got 5% in PFFV, which is a preferred shares fund, but it performs much like a bond fund in most years. And in the alternatives category, we have four funds. We have 15% in GLDM, that's a gold fund. We've got 10% in DBMF, that's managed futures. We've got 3% in BTAL, which is a long short fund that basically goes long value and short growth. And then finally 2% in IBIT, which is a Bitcoin ETF. And actually one of the worst performers last year. And so dragged this thing down a little bit. But if you look at the overall construction here, it ends up performing a little bit like a leverage fund because the UPRO and the G O V Z in it. And so we'll be comparing it to some funds with leverage in them. But it was down 0.36 for the month of December. It's up 17.09% for the year of 2025 and up 39.74% since inception in July 2020. We've distributed $3,020 out of this since July 2020. And we started distributing out of it at a 6% annualized rate. When it dropped below $8,000 in 2022, we went down to a 5% annualized rate. Now that it's come back to its starting point, we're now again distributing out of it at a 6% annualized rate since about September. Right now it's got $10,620 in it. We will be distributing $53 out of it for January 2026 at the 6% annualized rate. But we basically want to push this one to its limit. Since it really is kind of an experiment, I don't think there's any reason anybody really needs to hold 12 funds. But some people like to have that, so there you go. So what can we compare this to? Well, there are two ETFs, RPAR and UPAR, which are leveraged risk parity portfolio funds. And they had historically performed pretty badly since their inceptions until this past year, because they are composed of a variety of things, including some tips that probably don't belong in these funds, and some commodity exposures that are really more commodity stocks than they are commodities or managed futures. Anyway, so RPAR has a leverage of about 1.2 to 1, and that was up 17.91% for the year of 2025. So very similar to what we saw with the Risk Perry Ultimate sample portfolio. And then UPAR has a leverage of about 1.8 to 1%, and that one was up 23.17% for the year of 2025. That really compares more with a couple of our experimental portfolios that we'll get to. But again, you can see that our do-it-yourself fund perform very similar to these commercial preparations.

Voices [34:10]

I need preparation H. Right. Gives many people temporary relief for hours, combines active ingredients to relieve pain and itch, helps shrink swelling of inflamed hemorrhoidal tissue. That's real medicine. I'll take ointment and suppositories.

Mostly Uncle Frank [34:25]

At least when you account for the leverage. Now this one was based loosely on Harry Brown's original permanent portfolio, just adding some leverage to the stock and bond portions. It had a respectable performance last year. When you compare it with UPAR in particular, they had similar returns. And this one has a little bit more leverage in it than that one, but they are quite similar in fact. This is not something I would ever use, but it does make an interesting experiment, particularly when we compare it to the next experimental portfolio, which is our worst one. And that is this aggressive 50-50 portfolio, which is really just designed to show something with a lot of leverage and not much diversification, so it's just stocks and bonds. It has one-third in UPRO, the levered SP 500 fund, one-third in TMF, the levered treasury bond fund, and the remaining third divided into a preferred shares fund and an intermediate treasury bond fund. PFFV and VGIT kind of just as ballast. This one was taken off of what it's called Hedge Fundy's Excellent Adventure, which was a popular thing about five years ago. But I did kind of wonder whether it would have problems when we put it together way back when, just because of its lack of diversification and the extreme leverage that's in it. It was down 2.99% for the month of December. It's up 11.61% year to date and down 1.71% since inception in July 2020. And we've taken $3,097 out of it since July 2020. That was at an 8% annualized rate originally, and it went up 20% in the early years, which wasn't a big problem. But then it really took a dive in 2022 and hasn't really recovered. It has $6,833 in it currently. We'll be taking $35 out of it from cash for January. It's at a 6% annualized rate. But I think this one really exemplifies the perils of not enough diversification and too much leverage, and is why, if you are going to add leverage to a portfolio, you really do want to also focus on diversification beyond simple stock and bond allocations.

Voices [38:26]

You have a gambling problem.

Mostly Uncle Frank [38:29]

I am wondering if and when it will recover fully, but I'm not holding my breath. The next one is a Levered Golden Ratio, which has been around since July 2021. So you're a year younger than the first six. And we did revamp this portfolio at the beginning of last year, I should say when we rebalanced it, which is recorded on the website on the portfolios page. But we did add serendipitously, as it turns out, an exposure to AVDV, that international small cap value fund that's up 59% for 2025 to improve its diversification across a couple different dimensions. But this portfolio is really built around a composite fund called NTSX, which was the purpose of putting it together in the first place, was to see how we could use a composite fund like that. That fund is the SP 500 and Treasury bonds in kind of a 6040 combination that is levered up 1.5 to 1, so it's more like a 90-60 exposure there. Then we have 15% in AVDV, that small cap value fund. The other stock funds we have in here are a levered Dow fund, U DAO, which is essentially large cap value, and a levered utilities fund, UTSL, which represents mid cap value. And there's 5% in each of those. If you're wondering how those performed last year, U Dow was up about 24% and UTSL was up about 29%. So not bad. For bonds in this portfolio, in addition to the component that is part of NTSX, we also have 10% in TMF, that levered Treasury Bond Fund. And then for alternatives, we have 20% in gold and GLDM and 10% in the Managed Futures Fund, KMLM, which actually did not perform that well last year. It was actually down 3% for the year because of its exposures to a lot of agriculture and energy, as opposed to something like DBMF, which has more exposures to currencies and interest rates than KMLM. But despite all that, it did have a banner year. It was down 0.55% for the month of December. It was up 25.42% for the year of 2025, and it's up 19.87% since inception in July 2021. We've distributed $2,019 out of it since July 2021. We started at a 7% annualized rate, and then when it went below $8,000, we turned that down to a 5% annualized rate where it's at right now. Right now there's $9,424 in it. And if it gets back up to $10,000, we'll resume the 7% withdrawal. For January, we're taking out $39. That is a 5% annualized rate. And so that'll be $39 for the year of 2026 so far. This one is doing much better in its reformulation with a better allocation to the value side of the stock market, both domestic and international. And those were the best performers in this portfolio last year, aside from gold. And it's been recovering ever since. But that also makes it a good experiment to follow. For me, I find it difficult to build around these composite funds like NTSX. So I'm glad we did the experiment, but this isn't probably something I would adopt or repeat. On the other hand, if you did something like a combination of, say, NTSX and GDE, which is a composite fund of gold in the SP 500 that's up over a hundred percent last year, you'd probably be very happy with a couple of composite funds. So it's not like they can't work. I just think they're more difficult to work with, particularly when it comes to rebalancing and getting the allocations right between the various asset classes. Because you kind of have to pull it apart algebraically to match it up with the other funds that you want to put in your portfolio. Anyway, it actually did turn in the best performance of all these portfolios last year, just eking out the next one at 25.42% for this one and 25.37% for the OPTRA portfolio, which we'll talk about next. Moving to that OPTRA portfolio, this is designed to be a return-stacked portfolio, similar to what Corey Hofstein talks about. And so it is 16% in UPRO, that's the levered S P 500 fund, 24% in AVGV, which is a worldwide value-tilted fund that has both domestic and international and both large cap and small cap value and emerging market value. And then it's got 24% in GOVZ, it's a Treasury strips fund, and the remaining 36% divided into GLDM, the gold fund, and DBMF, the Managed Futures Fund. We set this one in motion in July 2024, and it's done really well so far. Of course, it's been a very favorable environment. It was up 0.25% for the month of December. As I mentioned, it's up 25.37% for the year of 2025 and up 29.03% since inception in July 2024. We've distributed $954 out of it, or will have after the next distribution, which will be $59 from cash that's accumulated. This one currently has $11,851 in it and has been over $12,000 recently. And I think this really is a portfolio with a much better balance between diversification and leverage than some of these other leverage portfolios we're fiddling with. The direct leverage in here makes it about $1.3 to 1, and then when you add the effect of the Treasury Strips Fund, it's about 1.4 to 1. But you can see that this one did outperform all of the commercial preparations, even the very leveraged UPAR fund. And so that's really what you want to see out of something like this, which I would consider more as an accumulation portfolio than as a drawdown portfolio. But we're drawing down on everything here. It's more interesting that way.

Voices [45:04]

These go to eleven.

Mostly Uncle Frank [45:06]

Anyway, it will be interesting to compare this in the future with a total stock market fund or a hundred percent equity allocation, because this is really designed to get those kind of returns, but not take as much risk with the diversification properties built into it. And so it's a very interesting experiment indeed so far.

Voices [45:29]

It cuts whack.

Mostly Uncle Frank [45:39]

And it will be interesting to see what happens to it in the future. Actually, it'll be interesting to see what all of these portfolios do in the future because since we started this podcast in July 2020, markets have really gone up mostly, and there really hasn't been any kind of drawdown that would cause basically any kind of portfolio to have much of a problem with safe withdrawal rates between four and six percent. And we have not gone through a recession since then, so it will be most interesting to look at these portfolios and compare them to other portfolios after we've gone through a complete economic cycle. But that's not going to occur until we go through a recession and come out of it, because then we'll be at the same economic starting point as we were in July of 2020 when we were just emerging from that sharp COVID recession. And it's kind of funny because somebody predicts a recession every year these days. And a giant market crash, and the best year ever. You could find any prediction you want, basically, if you look not even very hard for it. But I did consult my new crystal balls that my friend Bill gave me for Christmas.

Voices [46:51]

A crystal ball can help you, it can guide you.

Mostly Uncle Frank [46:55]

My calcite one and my obsidian one.

Voices [46:58]

I have a calcite ball, and I have a black obsidian one here, which is huge.

Mostly Uncle Frank [47:08]

And I said, so are we gonna have a recession in 2026? And this was the answer I got.

Voices [47:15]

We don't know! What do we know? You don't know, I don't know, nobody knows.

Mostly Uncle Frank [47:22]

Which is par for the course.

Voices [47:24]

Now you can also use the ball to connect to the spirit world.

Mostly Uncle Frank [47:29]

So I think that's enough on this annual review episode. We will put it up there. If you go to the episode guide page, actually, there are all the annual reviews and rebalancing episodes, because I know some people like to look at those where we go through these portfolios in more detail than we do every week. But I do highly recommend looking at that episode guide page if you are looking for something in particular. Many of which have just come out in the past year.

Voices [48:05]

Yes.

Mostly Uncle Frank [48:07]

But with that, now I see our signal is beginning to fade. We'll resume our regularly scheduled program with emails next week. And in the meantime, if you have comments or questions for me, please send them to Frank at RiskPardyRare.com. That email is Frank at RiskPardyRare.com. Or you can go to the website www.riskperdyrarear.com. 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, maybe some stars, a follow, a review. That would be great. Okay. Thank you once again for tuning in. This is Frank Vasquez with Risk Party Radio signing off.

Voices [49:18]

Um, in the awesome yeah and nothing.

Mostly Queen Mary [50:22]

The Risk Parody 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.