A number that goes with a mix you already chose. The handoff from the last post Last post introduced the second coefficient. We called it A_M. It sits inside a short formula that turns a mix into a label. Unlike… Continue Reading
Same letter. Different objects. The range from the tickets In the last post I showed an interval that measured risk aversion on a quiz. A clean switch on the worked example gave. That was my book. The higher the interval,… Continue Reading
A is for aversion and it’s an interval (for now) You already have the letters Last post we talked about tickets, the tickets were the measurement. To make things easy, we used a table. The table had two sleeves and… Continue Reading
When the probabilities are given, what would you choose? Let’s start measuring, shall we In the last post we learned about risk appetites and then we described capacity. A good and honest fiduciary knows there’s a difference. They’re out there… Continue Reading
Just because you want to doesn’t mean you can. The question the coin left open In the last post we defined several key economic concepts. There’s wealth and it’s utility. We chase it because it buys things. Then we presented… Continue Reading
Risk, wealth, utility — in one picture The question the paycheck left open The hundred-year price sample paid about 8.43% on average (it’s here if you want to read it). The miss around that average was about 18.58%. That’s a… Continue Reading
What is risk? Here’s the formal definition. Risk: noun “Risk is the possibility that something bad or unpleasant (such as an injury or a loss) will happen” That’s risk. Simple but often times misunderstood. Risk is not that something is… Continue Reading
Over a hundred years of S&P 500 gains — and the years that were not so great. The pitch we all know. For years the script has been the same. Time in the market beats timing the market. Ignore the… Continue Reading
As Americans continue to argue over inflationary impacts of reciprocal tariffs on major trading partners from the Trump administration, one thing remains clear, price of certain hard and soft commodities continue to trend downwards. The spot price of orange juice… Continue Reading
There aren’t many shortcuts when it comes to building wealth and achieving financial independence. To create meaningful wealth, you need to either build a killer product or provide impeccable service. Same is true of investing you have to work at… Continue Reading
On the previous post, we went over the concepts of gains and losses. Specifically, we discussed the required investment gains to recover portfolio losses. Over the past few weeks, we’ve witnessed significant market volatility, with the S&P 500 officially entering… Continue Reading
In the next series of posts, we will delve into the most important aspect of capital management. Make no mistake, if you have money invested in the capital markets whether it’s through a retirement account or a personal investment account,… Continue Reading