How to Diversify Your Life

2min Snip

00:00

Play full episode

Summary

Transcript

Episode notes

I think there are several ways to diversifi te whether it's through investing evenly across risky and non risky assets, or more of that bar bell strategy. I think it's just important that people don't go all in on something, even if they think it's that really positive, incredible tale. If you're young and ambitious, one recommendation would be that you live in a city. The reason for that is because a city has more people with diversified thoughts or experiences. And there's also more events and things going on.

In this episode, Cal and Steph discuss the hidden side of risk: the infrequent, often unpredictable events that make the biggest differences in our lives.

If you look around, rare, high-impact events are everywhere.

A small number of days in the stock market drive the bulk of the returns.
Large businesses like Google, Amazon, and Best Buy have tested thousands of products, yet have a single profit puppy.
Insurance companies make money on most customers, but have to pay out very large claims to a few people.
A handful of people have had more of an effect on the future than the other 7 billion people combined.

This episode is all about navigating tail risk and tail opportunity. You'll learn how to better avoid the catastrophic events in life, and on the flip side, to take advantage of the life-enhancing opportunities with asymmetric upside.

Love this episode? Give it a review at https://ratethispodcast.com/learn