The real difference between offense and defense in portfolio construction
Why treating your portfolio as savings rather than a get-rich-quick scheme is crucial
Understanding real vs. nominal returns and why this distinction matters more than ever
The dangers of U.S. market exceptionalism and what we can learn from other markets' struggles
How to think about portfolio construction like building a championship sports team
The critical concept of ergodicity and why averages can be deceiving
Using colorful analogies from the Dallas Cowboys' infamous Herschel Walker trade to Dennis Rodman's overlooked impact on the Chicago Bulls, this episode breaks down complex investment concepts into actionable insights. Perfect for investors wanting to move beyond basic diversification and build portfolios ready for whatever the future holds.
Featuring Jack Forehand (@PracticalQuant), Matt Ziegler (@cultishcreative), and insights from our interviews with Jason Buck.
#investing #portfoliomanagement #financialeducation #marketsense #investingstrategy
0:00 Intro and current market environment
3:17 Offense vs Defense in portfolios - Challenging Dalio's 16 return streams
7:33 Rethinking savings vs investments
10:37 Sports analogies for portfolio construction
11:00 Why Dennis Rodman was the Bulls' most valuable player
12:00 Lessons from the Herschel Walker trade
18:32 Real vs nominal returns - What you actually keep
22:47 Historical return rates across asset classes
24:16 The Japan example - 30 years underwater
29:10 Can we extrapolate the past 150 years?
34:00 Questioning U.S. market exceptionalism
39:28 Understanding ergodicity in investing
43:34 The coin flip example and sequence risk
46:09 Closing thoughts
47:07 Contact information and disclaimers