Episode 7: How To Construct A Risk Parity Style Portfolio From Basic Principles
Risk Parity Radio
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The Macro Allocation Principle for the Do-It-Yourself Risk Parity Investor
The risk-reducing effect of this is very pronounced with the first few asset classes and then flattens out as you keep adding more. More than 90% of your portfolio's performance can be explained by its macro asset allocations. A negatively correlated asset class will have an outsized impact on reducing risk, which leads to our second main principle for the do-it-yourself risk parity investor.
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