Invest Like a Billionaire How to build a Passive Alternative Portfolio: The Wealth Pyramid
Jul 29, 2025
Ellis Hammond, Vice President of Capital at Aspen Funds, joins Ben Fraser to discuss strategic investing using the wealth pyramid. They emphasize avoiding impulsive decisions and the value of a structured approach to building a passive alternative portfolio. The conversation delves into learning from investment challenges, particularly in volatile markets, and highlights the importance of balancing risk and growth. Listeners will gain insights into creating a solid foundation of lower-risk investments while navigating complexities of post-exit strategies.
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Lack of Investment Strategy
- Investors often lack a clear investment strategy and instead invest randomly in deals that come their way.
- This haphazard approach ignores risk, return, diversification, and long-term goals.
Foundation of Portfolio: Cash Flow
- Base 50-60% of your portfolio in low-risk, cash-flow-focused investments yielding 9% to 11%.
- Prioritize current cash flow over headline IRR to create a stable financial foundation.
Middle Tier: Hybrid Investments
- Allocate 20-30% of your portfolio to hybrid investments that combine some cash flow with growth potential.
- Target mid-teens returns with value-add deals offering tax benefits and moderate risk.