Risk Parity Radio

Episode 433: More About Transitions, Leveraged ETFs And Other Gambling Problems And Wisdom From The Great Jim Rohn

Jun 26, 2025
The discussion tackles the intricacies of transitioning to a risk parity portfolio, emphasizing that many funds provide false diversification. Listeners learn about the challenges of leveraged ETFs and the importance of understanding what's in each investment. Insights from Jim Rohn underline the necessity of discipline in achieving success. Additionally, the importance of charitable support and responsible financial decisions is highlighted, alongside reflections on personal growth and taking charge of one’s financial future.
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ADVICE

Avoid False Diversification

  • Avoid holding multiple similar large-cap funds as it creates false diversification.
  • Check fund holdings to understand actual diversification before building your portfolio.
ADVICE

Transition Portfolio Comfortably

  • Transition to a risk parity portfolio either all at once or through dollar cost averaging.
  • Choose the method that feels psychologically comfortable, as long-term results tend to even out.
ADVICE

Manage Taxes During Transition

  • Consider your tax bracket before transitioning, selling tax lots that minimize your tax bill.
  • Spread conversion over a couple of years to mitigate tax impact if needed.
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