Risk Parity Radio
Risk Parity Radio is a podcast about investing located at www.riskparityradio.com. RPR explores risk-parity style portfolios comprised of uncorrelated or negatively correlated asset classes -- stocks, selected bonds, gold, managed futures, and other easily accessible fund options for the DIY investor. The goal is to construct portfolios that are robust and can be drawn down on in perpetuity, and to maximize projected Safe Withdrawal Rates regardless of projected overall returns.
Risk Parity Radio
Episode 421: NItty Gritty Portfolio Considerations And Variations, What We Actually Hold, And The Basics Of Rebalancing
In this episode we answer emails from Luc, Ellen and Andrew. We discuss Luc's target portfolio, the process for evaluating and choosing new assets for a portfolio -- comparing why managed futures pass the test, while covered call fund and TIPs funds don't --, what's actually in our personal variation of the Golden Ratio portfolio, finding old podcast episodes and basic rebalancing principles as to timing. And learn some Canadian French and Minnesota vernacular along the way.
Links:
Andrew Beer Interview on Masters In Business Podcast: Andrew Beer on the Hedge Fund … - Masters in Business - Apple Podcasts
RPR Episode 40 on YouTube: Episode 40: Answering A Question About Big ERN's Gold Analysis From Joseph K.
Kitces Article on Rebalancing: Optimal Rebalancing – Time Horizons Vs Tolerance Bands
Breathless Unedited AI-Bot Summary:
What makes a truly resilient portfolio? In this revealing episode, Frank Vasquez pulls back the curtain on both theoretical and practical aspects of risk parity investing through thoughtful listener questions.
When a software engineer from French-speaking Canada shares his leveraged risk parity portfolio, Frank offers nuanced guidance on balancing potential returns with sustainability. Rather than dismissing leverage entirely, he suggests a more measured approach—reducing exposure to funds like UPRO while maintaining their rebalancing benefits. This practical compromise exemplifies Frank's philosophy of building portfolios that remain psychologically manageable through market turbulence.
The conversation takes a fascinating turn as Frank reveals his framework for evaluating new investment opportunities. Unlike many advisors who chase trends, his three-question methodology ensures only truly valuable assets earn portfolio space. His explanation of why managed futures succeeded where TIPS failed demonstrates how professional-grade analysis can be applied to personal investing. "The truth is," Frank notes, "a lot of otherwise viable or interesting strategies actually just don't fit into what we're trying to do here."
Perhaps most valuable is Frank's unprecedented breakdown of his personal portfolio holdings. Beyond the expected allocations to stocks, bonds, gold and alternatives, he shares his experiments with direct indexing of property and casualty insurance companies—a Warren Buffett-inspired approach that provided positive returns even during 2022's difficult markets. This rare glimpse into a professional's actual implementation bridges the gap between theory and practice.
Whether you're questioning how often to rebalance, wondering about international exposure, or simply curious about how a professional approaches their own money, this episode delivers actionable insights while maintaining Frank's trademark blend of humor and wisdom. Ready to build a portfolio that marches to a different drummer? This is the roadmap you've been waiting for.
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: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: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.
Voices:Yeah, baby, yeah.
Mostly Uncle Frank:And the basic foundational episodes are episodes 1, 3, 5, 7, and 9. Some of our listeners, including Karen and Chris, have identified additional episodes that you may consider foundational, and those are episodes 12, 14, 16, 19, 21, 56, 82, and 184. Whoa, and you probably should check those out too, because we have the finest podcast audience available.
Mostly Mary:Top drawer, really top drawer.
Mostly Uncle Frank:Along with a host named after a hot dog.
Voices:Lighten up Francis.
Mostly Uncle Frank:But now onward to episode 421. Today, on Risk Parity Radio, we're just going to do what we do best here, which is answer your emails.
Voices:You can't handle the dogs and cats living together.
Mostly Uncle Frank:And so without further ado.
Voices:Here I go once again with the email.
Mostly Uncle Frank:And First off. First off, we have an email from Luke.
Voices:Luke from French-speaking Canada everywhere. Là là fait que là il veut pas comprendre. Là là, ok là, là là, écoute-moi. Là, ok là, mais là, ben là, ben oui, comprenez-vous là.
Mostly Uncle Frank:And.
Mostly Mary:Luke writes Hi Frank, you completely changed my investing life for the better, of course. Uh, what? It's gone. It's all gone. The money in your account it didn't do too well, it's gone. I started listening to your podcast three years ago and have been hooked ever since. I've applied a lot of your teachings, but I'm still learning, so let me bow to my sensei.
Mostly Uncle Frank:Bow to your sensei.
Mostly Mary:Bow to your sensei. I'm a 46-year-old software engineer and have been blessed with an amazing wife, two fantastic daughters who are now teens teens and an emotionally needy cat. I'm from the French-speaking part of Canada. English is my second language, so you'll have to forgive me if I make grammatical errors. Due to my personal situation, it's impossible for me to know how soon I will be in with my withdrawal phase. I have therefore already started to move to a risk parity style portfolio. My portfolio is currently a bit of a mess because I have a mix of Canadian and US ETFs. However, my target portfolio is the following. My target portfolio is the following 10% UPRO, 15% AVUV, 15% AVDV, 20% ZROZ, 5% GLDM, 15% KILOTO that's, gold hedged to the Canadian dollar. 20% alternative split equally across DBMF, kmlm and GASP BTAL.
Voices:Shirley, you can't be serious. I am serious, and don't call me Shirley.
Mostly Mary:With the allocation to UPRO, this results in a light leverage of 1.2x. The allocation to gold hedged to the Canadian dollar is based on analysis of historical backtests, taking into account currency fluctuations. I'd be happy to share this analysis in a future email. Hopefully Mary is not out of breath at this point. I am not.
Mostly Uncle Frank:Mary, Mary, I need your huggin'.
Mostly Mary:Here come my questions. 1. Any thoughts or general comments on my target portfolio? Any thoughts or general comments on my target portfolio? Do you think it would be more prudent to drop the leverage and go with 25% VUG, slash, 12% AVUV, slash 12.5% AVDV for my stock allocation and spread the remaining 50% evenly across other asset classes? Two as I've learned new information from your podcast and other sources, my target portfolio has evolved. I also noticed that you've gradually incorporated new ideas into your model portfolios. For example, if I recall correctly, you didn't use managed futures when you started your podcast. However, you now recommend them and have incorporated them in your model portfolios.
Mostly Mary:How do you decide if a new asset or a previously overlooked asset is worth adding to the portfolio? How often would you recommend incorporating new ideas in a portfolio? Three in a recent episode you said you have an allocation to IDMO. I don't remember you sharing that before. It reminded me that you've mentioned the importance of looking at a financial expert's actual portfolio when considering their advice. Over the years, you've periodically talked about some of your holdings, but I don't remember you giving a more complete picture of the assets you hold and in what proportion percentages. Would you be open to share more details in your portfolio. We can then all apply the Bruce Lee principle on what you share. I hope your podcast continues for a very long time.
Mostly Uncle Frank:Since before your son burned hot in space and before your race was born, I have awaited a question.
Mostly Mary:I'm looking forward to at least 400 more episodes of Risk Parody Radio. Thanks in advance and all the best, luke.
Mostly Uncle Frank:I guess it's time we all learned how French is spoken in Canada, given the trade wars and everything else going on.
Voices:Number three, the famous religious swears, Les sacs. You see, historically Quebec has had a deep love for religion. That's embedded in its society and culture. No, it's more of a history of conflict with the church that has turned some religious words into profanity, swears, insults, For example, Chris Christ, or tabarnak tabernacle, carlis, the chalice and esti. In fact, you can use them as verbs and nouns. That's how complex it is. Esti de carlis de tabarnak, Ferme ta yeule. Esti, Je m'en crisse, je m'en carlisse Crisse, moins patience. Esti Crisse-les dans les poubelles. Esti, and you can even roll the R to make it that much richer. Crisse de.
Mostly Uncle Frank:And now that we're done with that little frolic and detour. First off, I'd like to thank you for being one of our donors to the Father McKenna Center. As most of you know, we do not have any sponsors on this podcast. We do have a charity we support. It's called the Father McKenna Center and it supports hungry and homeless people in Washington DC.
Mostly Uncle Frank:Full disclosure I am on the board and I'm the current treasurer, but if you give to the charity, you get to go to the front of the email line, as Luke has done here. Oh, no, and there are a couple of ways to do that. You can go to the Father McKenna donation page itself, which I will link to in the show notes. Or you can go to the support page at wwwriskparadiocom and join our patrons on Patreon who are regular donors. Either way, you can go to the front of the line that way. Just make sure to mention it in your email when you send it to me so I can duly move you to the front of the line, or have my crack team work on that.
Voices:We have top men working on it right now. Who?
Voices:Top men.
Mostly Uncle Frank:All right, you're in an interesting spot here with some interesting questions and first, to clarify for everyone, the spot you're in is that you seem to have accumulated a significant amount of money so that you are close to being financially independent, in which case it's appropriate to shift to a retirement-style portfolio, at least with the money you intend to live off of which you have done, of which you have done. It is also true that some people choose to accumulate in these kinds of portfolios because they are less volatile and less unpleasant to watch go up and down, even though it's going to take a little longer to get where you need to go if you're trying to accumulate in a risk parity style portfolio. Getting to your specific questions on your target portfolio yes, it all looks pretty good, although your question about the leverage is a good one, because I'm not that comfortable using leveraged funds for any meaningful amount in a portfolio, even though I know some people do and have done it successfully.
Voices:You have a gambling problem.
Mostly Uncle Frank:And we do have experimental portfolios, some of which are more successful than others.
Voices:Well, you have a gambling problem.
Mostly Uncle Frank:I would have to say that our portfolio does look more like 50% in stocks and then 50% in bonds and alternatives, as you have proposed here basically. As you have proposed here, basically, you might consider doing a little bit of both here, and what I mean by that is reducing your exposure to the leverage fund by half, so it would be only a 5% exposure, and then making adjustments in the rest of the portfolio to match that. And if you have a little bit of UPRO and then some large cap growth, that kind of go together, it will actually give you more rebalancing options when you get to those sorts of things which may be of some use to you. But either way, it looks like you are certainly on the right track here.
Voices:You are correct, sir. Yes.
Mostly Uncle Frank:Your second question is very interesting, which is how do I decide if a new asset or previously overlooked asset is worth adding to a portfolio? And you mentioned managed futures. If you look back, the history of the discussion of managed futures on this podcast goes back to early January of 2021, when the podcast was only a few months old. When the podcast was only a few months old and we discussed what was relatively new at the time DBMF, a managed futures fund, based on an interview by Barry Ritholtz of Andrew Beer, who is the person who founded that fund, and it was interesting. The interview was not all about DBMF at the time, it was just kind of an extra thing they talked about.
Mostly Uncle Frank:But the question is, why did I pick up on that and not on something else? And a lot of it has to do with the history of the asset class itself, because some asset classes have a good long history of either being able to perform, being uncorrelated with other assets or some combination of those sorts of things. Managed futures is one of those things that has been around and been successfully used by a lot of traders and a lot of hedge fund operators for a very long time, and Cliff Asness and AQR have a lot of articles and things about that. If you really want to know all about that, I suggest you start listening to a podcast called Top Traders, unplugged. Now we can compare that, which has a good long history of being a viable strategy, to something with a long history of not being a very good strategy at all.
Mostly Uncle Frank:An example of that would be these covered call funds which have been around in various guises since the 1980s and really have not added much to a portfolio other than being expensive and eventually decaying. So when people have mentioned those, my reaction has been the opposite, because I know those do not have a good long history of good and useful performance. And so that's the question First, does this particular strategy have some kind of history to it, and what is that history? So that's the first question. The next question is has something occurred that makes this strategy more viable than it used to be and with managed futures? The main problem with it prior to recent years and these new ETFs is that you either had to do it yourself, which is complicated and takes a lot of time, and I actually did do some of this back in the 1990s, so I know what it's about, even though we were working on phones then and not on computers. But the other problem with it in the past few decades has been, if you wanted to have somebody else do it, it was very expensive. The funds were very expensive. A lot of them were inaccessible because they were offered as partnerships or something like that, and the mutual funds that were available usually had fees that were in excess of 2% and sometimes in excess of 3% and it really was not that useful a strategy if the fees are that high because the returns are somewhere between stocks and bonds on the long-term time frame.
Mostly Uncle Frank:So what DBMF and some of these newer funds have offered is a much less expensive way to get into these sorts of things. It's still an expensive fund. It's about 0.8 or 0.85, I think, is the expense ratio which is kind of typical on these things right now. But compared to 2% or 3%, it's very much a lowered fee, which is also ameliorated by the fact that you're not going to hold this as a huge part of your portfolio it's not going to be half your portfolio or something. So the fee in terms of the overall portfolio is not going to be that high. And then it does have a high enough return to support that, given its very favorable correlation coefficients with both stocks and bonds, which are essentially zero, and plus the fact it tends to perform best in either severely deflationary environments or severely inflationary environments. So all of those characteristics made it more viable.
Mostly Uncle Frank:And then there's kind of a third question that I always have in my mind Is this something that professionals are actually using respected people and they're not fly-by-night operators trying to sell you something, and in this case we're talking about somebody who has been in the investment business for, I think, now three decades, who appeared on the Barry Ritholtz podcast, which is called Masters in Business, where everybody from Warren Buffett and Charlie Munger to Jack Bogle and anybody you've ever heard of has appeared on that podcast. So if you want to hear from people who are working at the highest levels of the investment profession, that is a good source for listening or learning about these sorts of things. If I had only heard about it on some personal finance podcast or from some people who are not professionals, then I would certainly discount it severely, because the goal here has always been to take the best ideas from the real professionals who manage billions of dollars.
Voices:The best, Jerry the best.
Mostly Uncle Frank:Simplify those down I'm not a smart man. Simplify those down I'm not a smart man and put them in such a way that they are useful to a do-it-yourself investor, particularly in a retirement context. But you really have to start with people who know what they are talking about and have been in this as a paid profession for a good long period of time. Now, your next question, or sub-question, was how often would you recommend incorporating new ideas in a portfolio? The answer to that is not very often like on the order of once a decade, or once every five years, at least in any kind of substantial amount, because the truth is a lot of otherwise viable or interesting strategies actually just don't fit into what we're trying to do here.
Mostly Uncle Frank:Forget about it, because they would take up space in a portfolio for something that is already doing something we want, and not give us the same bang for your buck. So, for instance, that's one of the reasons that I don't think TIPS funds are very useful in these kind of portfolios and I've discussed that before but basically they do not shield a portfolio from inflation in any meaningful manner. They only shield themselves from inflation when you're comparing them to nominal bonds or cash. But they are bonds, but they're just not very good bonds. So it's one of those things that, yeah, in theory you might be able to use it for something, but when you try to use it in practice, it doesn't do any job well.
Voices:You had only one job.
Mostly Uncle Frank:Whereas something like managed futures does several jobs well that are not done by the other assets in the portfolio, and so that's why, in years like 2022, when most traditional assets were down or flat something like managed futures did quite well.
Voices:That's the fact, Jack. That's the fact, Jack.
Mostly Uncle Frank:And you'll find that's true of most kind of crisis periods where there's either a lot of inflation or a lot of deflation going on. Contrast that with something like tips in 2022, which were awful the money in your account. It didn't do too well, it's gone. They did not shield anybody's portfolio from inflation and, in fact, detracted or made people's portfolios worse.
Mostly Mary:That's not an improvement.
Mostly Uncle Frank:So that is also a very important question ultimately is does this really have a place in a portfolio? When we're trying to construct a retirement portfolio to have a high safe withdrawal rate, what would you say you do here? And in many cases, a lot of these assets just don't do anything well enough that you would make space in the portfolio just to have something. Now I will add one caveat here. I was really talking about making a major allocation to an asset class.
Mostly Uncle Frank:I'm a very curious person, so I don't mind holding little bits and pieces of all kinds of things, and that is basically what I use that 6% in the golden ratio portfolio for, Instead of it holding it in cash like in the sample portfolio. That's where we put all of our odds and ends, if you will, and before I would want to add a significant allocation in a portfolio to anything, I would want to hold it in a very small quantity for some period of time, at least a year or two, just to get an idea of what it's like. So I've done that over the years with various volatility funds and funds that invest in the strength of the US dollar, some crypto-type related stuff and other experimental things.
Mostly Mary:Are you saying that I put an abnormal brain?
Voices:into a seven and a half foot long 54-inch wide gorilla.
Voices:Is that what you're telling me?
Mostly Uncle Frank:And most of these things I just ditch after a while because they don't seem to be doing anything useful in particular. But that's more of the hobby component to investing that I engage in, which is why I also want to limit that to a very small part of our portfolio, so it's really not affecting the overall performance of anything. You need somebody watching your back at all times. I wouldn't think that's of very much interest to most people, unless you're just really curious about this stuff. But if you're really curious about this stuff, like I am, just remember that curiosity killed the cat At my age the mind starts playing tricks.
Voices:So, ah, death, that's only the cat, oh.
Mostly Uncle Frank:And you don't have nine lives. So you want to make your curiosity only a small part of what you're doing, so that it doesn't come up to bite you. All right, your last question with your reference to the allocation to IDMO I-D-M-O, which is actually a international momentum fund large cap momentum but it behaves like a nice international large cap growth fund, and the reason that came up is because some of our listeners were asking about such things, and so that is one of the options. That is actually something that I do hold in part. Of that 6% that I've been talking about, a lot of that 6% is actually in our portfolio devoted to these international funds, either international value funds or international growth funds, and although Avantis has some very nice international value funds, like AV DV, the international growth side is much more spotty. So you have things that are labeled international growth funds, like EFG, then you have things that are international growth funds in practice, like IDMO, and then you have other things that are designed to be like international tech funds, like EMQQ, which is a emerging markets tech fund, along with some of these Chinese shares funds that we've talked about in the past. So I find all of these things interesting and hold small allocations to them, but they do not form a large part of our portfolio in a significant way. Now some of our listeners do want to have more international exposures, in which case I still recommend that your stock exposure be divided essentially into the growth side and the value side and then, in the growth side, figure out well how much of that is US and how much of that is international or other country, and then, on the value side, do the same exercise, and it looks like that's something you've done and will probably work out just fine. Size, and it looks like that's something you've done and will probably work out just fine.
Mostly Uncle Frank:So, getting to what our current portfolio looks like, well, it is based on the golden ratio portfolio, largely so. The base part of it is that 42% in stocks, which is divided into growth and value. On the growth side, it's a lot of VUG, a little bit of IWY and a tiny bit of UPRO, which I would include in that category, as well as really from the 6% allocation. We have some of these funds like IDMO that add to this allocation. Now, the value side of things in our portfolio is more diversified than just holding a small cap value fund, as I mentioned before, in addition to holding a substantial allocation to small cap value, we also hold a substantial allocation to property and casualty insurance companies which fit into the world as mid-cap value.
Mostly Uncle Frank:And the reason I've been holding these has a lot to do with Warren Buffett, because the lesson that I learned from Warren Buffett that most people have not learned is that having insurance companies as a large part of a portfolio tends to bring a lot of balance and good performance because, in addition to being stable and profitable, they also tend to be less correlated to the rest of the market than a lot of other things. So the way we've approached that is. There is a fund called KBWP which invests in property and casualty insurance companies. These are things like Allstate and Chubb and Progressive, with a name like Smucker's, it has to be good aggressive With a name like Smucker's, it has to be good.
Mostly Uncle Frank:So I don't hold that fund directly because it's expensive. I think it's cheaper than it used to be, but it's still like 0.35. We actually hold those companies individually. So it's a basket of these property and casualty insurance companies and if you want the list of them, just go look at the first 10 holdings in KBWP and that's pretty much what we've got.
Mostly Uncle Frank:This is one of my minor experiments in what it's called direct indexing, where you hold the individual companies in a allocation as opposed to simply a fund, and it can be helpful for tax loss harvesting and taxable accounts, but I can tell you it does make our situation more complicated Inconceivable. That was also one of the allocations, though that was up in 2022. It was up about 10%, so it really does have some interesting diversification properties. I had also looked at life insurance companies as part of that allocation, but decided not to go with those Because I think there's actually more money or profitability to be made on the property and casualty insurance side of things, for an interesting reason that life insurance is actually very predictable. Using something called the Gompertz mortality curve, it's relatively easy to know when populations are going to die and since everybody can know it, it's easy to price. Life insurance, property and casualty insurance is much more difficult to price, and so the companies that can do it well, like Progressive, are very profitable companies, and I think that's only going to improve with the use of artificial intelligence.
Mostly Uncle Frank:Now, the other allocation that we hold on the value side, on the stock value side, is also kind of an experiment in direct indexing, and it's large cap value companies. So what I did there is also look and find a large cap value fund that has had a very good track record of picking these sorts of things. But instead of buying the fund and the fund is called PARWX used to be the Parnassus Endeavor Fund, now it's called the Parnassus Large Cap Value Fund and I basically looked inside of that and took the top 25 holdings and there are things like Oracle and S&P Global and John Deere and stuff like that and S&P Global and John Deere and stuff like that, and so those also make up an allocation in our taxable account as part of our large-cap value holdings, and that also does help with tax-loss harvesting having those individual companies to be able to buy and sell. So you can see, on the stock side of things, I've added some unnecessary complexity to our portfolio.
Mostly Mary:I think I've improved on your methods a bit too. I employed some Chiara Scuro shading.
Mostly Uncle Frank:But I've tried to do it in such a way that it will have mostly positive effects and not very much tinkering effects. And no, I don't think anybody really needs to do that. But I know that a lot of people do like to tinker with their portfolios, in which case it is good to set up some guardrails around what you're doing, so you know it's within a framework and isn't going to mess things up.
Voices:So that means that every single day that you see me. That's on the worst day of my life.
Voices:What about today? Is today the worst day of your life?
Mostly Uncle Frank:Yeah, Wow that's messed up. Okay, in addition to the stock allocation, which is the 42%, and the golden ratio, to which we've added the 6%, because a lot of the things I've hold in there are international stock funds like AVDV, we also have the 26% in long-term treasury bonds, essentially, and that's a mixture of things like VGLT and then also things like ZROZ, which allows us to actually hold a little bit less in there than 26% nominal. And then we hold 16% in gold, which is mostly in GLDM, 10% in managed futures, which is mostly in DBMF, but also some KMLM, and that's about it. I think I've also mentioned that we do have a couple of smaller Roth accounts that I use for experimental portfolios because we don't intend to use them for anything in particular, and hopefully they will grow to be something very large and be like the last things we would be touching, and that's really the place we're fiddling around with things like you, pro. So hopefully that gives you an overview.
Mostly Uncle Frank:I'm sure I've missed something and you should apply bruce lee principles to that. Those principles are take what is useful, discard what is useless and add something uniquely your own. And what you should definitely discard is most of the complexities I've added to these sorts of things because they're completely unnecessary for what we are actually needing or trying to do, although I've tried to make sure that they do not interfere with our ultimate goals and are organized in the overall allocations that we want. In terms of macro allocations, I think you're going to be just fine if you stick to much simpler formulations that are similar to things like the golden butterfly and golden ratio sample portfolios. And, as to your final comment, I hope your podcast continues for a very long time. I'm looking forward to at least 400 more episodes of Risk Parity Radio and, yeah, I'm hoping it does too. I really set out to make this about a 10-year project, and we're only in year five right now.
Voices:It does sound like fun. I can't wait to start pawing through my garbage like some starving raccoon.
Mostly Uncle Frank:One of the reasons I'm able to keep it up is that it's a very minimalist operation. It's not that I'm lazy.
Voices:It's that, I just don't care.
Mostly Uncle Frank:It usually takes less than 10 hours a week, even doing two podcasts, but that's one of the reasons we have no sponsors, we have no guests and we have no expansion plans.
Voices:So are you gonna get another job?
Voices:I don't think I'd like another job.
Mostly Uncle Frank:Because I do want this to be sustainable and fun as a retirement hobby and not turn into another job.
Voices:Looks like you've been missing a lot of work lately. I wouldn't say I've been missing it, Bob.
Voices:Good one.
Mostly Uncle Frank:We have seen slow growth over the years, but it's been nice growth because I'm really appreciative of the kinds of podcast listeners that we've attracted. It seems like there are about 2,000 regular listeners now, somewhere between 1,500 and 2,000. We are up to 900 and some thousand downloads and should hit a million downloads sometime later this year, which I always have to laugh, because in order for a podcast to be commercially viable, it needs to be having more like hundreds of thousands of downloads a month or millions of downloads a month. But even having only a mere 20 to 30 000 downloads a month puts me in the top one percent of all podcasts, which just tells you that there are a whole lot of podcasts out there that nobody's listening to forget about it but thank you for your support, luke, and thank you for your email and as I had already lived a little bit in france, I wanted to discover something else.
Voices:so for a year, I decided to improve my French in Quebec. Yeah, but no one had warned me, in fact, that this is not where you need to improve your French. And I realized very quickly that going to Quebec to improve your French is a bit like going to England to improve your cuisine we have the same ingredients, but we do anything with them.
Mostly Uncle Frank:Well, that was a long one. I think we do have time for a couple of short ones here. So getting to the next one, second off, second off.
Mostly Mary:We have an email from Ellen, and Ellen writes how do I get to a specific podcast, for example, how do I get to podcast number 40? To be clear, the search bar does not seem to be working. Okay, turn it on.
Voices:Kill, kill, turn it off, turn it off.
Voices:It's a piece of crap. It doesn't work. I could have told you that.
Mostly Uncle Frank:Well, there are several ways of accessing the podcast. It looks like you're struggling with the main podcast page. I'm sorry about that. I don't have any explanation for it. I'll put my crack team on it though.
Voices:We have top men working on it right now.
Mostly Uncle Frank:Top men, if you're having trouble there. It is also distributed fairly widely to Apple Podcasts, to Spotify and to YouTube and it may be easiest for most people just to go to YouTube. And there is a Risk Parity Radio channel and all the podcasts are there. Oh, skitsign it. You can search the number and probably find it pretty quickly. The other place you can find all of the podcasts on one web page is the RSS feed page, which is also accessible from the podcast page at wwwriskprioritycom. Just follow that link which appears in the text near the top, and that will take you to a very long web page with all 421 podcasts on it and all of the show notes. So don't try to open it on your phone, open it on a browser. But you can find everything there in one place and you can even search it for particular topics with that control F function.
Voices:Yes.
Mostly Uncle Frank:So hopefully that helps you find things and thank you for your email, gosh, last off. Last off, an email from Andy, and Andy writes Hi, frank.
Mostly Mary:I've been following your work for about a year now and I'm a very loyal listener, top drawer, really top drawer. Using what we have learned from the podcast, my wife and I have recently converted to a risk parity style portfolio. I have one question, though how often should we rebalance the portfolio, assuming that we're about five years from taking distributions out of it? Thanks for all that you do, andy from Minnesota.
Voices:Well, hey there, I didn't see you. My name is Pat and, if it's all right, I'd like to take a moment to introduce you to a few words you might hear in Minnesota. Number one hot dish. In Minnesota, hot dish is what you might call a casserole, but it can also be any dish with meat, canned green beans, canned corn, canned cream of mushroom soup and, of course, tater tots, corn canned cream of mushroom soup and, of course, tater tots. Number two that's different In Minnesota. Saying that's different is our way of saying.
Mostly Uncle Frank:I don't like it in a polite way, for example, you might try your neighbor's hot dish and say that's different. Well, andy, these are not that much different from most other kinds of portfolios. So once a year is a good guideline for rebalancing and you could do it. More says is that once a year seems to work pretty well and if you do it more often than that, it probably doesn't make much of a difference, although it won't hurt you If you are still adding to the portfolio. You can simply just add to whatever allocation is low and that will essentially do your rebalancing along the way. And that would probably be useful if you're talking about a taxable account, because you want to reduce the number of transactions in your taxable accounts to avoid unnecessary taxes.
Mostly Uncle Frank:The other way people have approached rebalancing is with what are called rebalancing bans, and that is also described in the Michael Kitsis article that I'm going to link to. But essentially that is where you actually look at the percentages to see how far out of line your current percentages are versus your target allocations. So, for example, since gold has performed so well in the recent past, if you look at something like the current sample portfolio of the golden butterfly or the golden ratio, current sample portfolio of the golden butterfly or the golden ratio, you'll see that the percentage of gold overall in the portfolio is more than 20% of its target allocation. If you were on a rebalancing band plan, that would probably be enough to trigger a rebalancing the whole portfolio, and so that's the other way of doing things.
Mostly Uncle Frank:We do manage some of the experimental portfolios using that kind of rebalancing band management, so if you want to take a look at those, you'll get an idea for how it works. I don't really think it's necessary in your case. It is more something for people that just like to be more hands-on with their portfolios. As long as you are rebalancing it once a year or thereabouts, things should work out just fine. Hopefully that helps, and thank you for your email.
Voices:Number four oh for cute. Oh for cute basically translates to how wonderful Sure. You can say it about a dog or a baby, but you can also say it about an antique shop or a quilt or a grey duck. Number five you betcha. This last one is really important because you betcha is how Minnesotans say you're welcome. For instance, you might say, hey, pat, thanks for taking so much time out of your day to make this video, and I might respond you betcha.
Mostly Uncle Frank:But now I see our signal is beginning to fade. If you have comments or questions for me, please send them to frank at riskparryradarcom. That email is frank at riskparryradarcom. Or you can go to the website, wwwriskparryradarcom. 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 and make some stars a follower of you. That would be great. Okay, thank you once again for tuning in. This is Frank Vasquez with Risk Party Radio signing off Round and round.
Voices:We'll love a fun way. Just give it time. Round and round. What comes around goes around. I'll tell you why. Round and round Will love or fire away. Just give it time, time, time, time. What comes around goes around. I'll tell you why, why, why, why Round and round.
Mostly Mary: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.
