How to Beat the 60/40 Portfolio

In this video Ryan discusses how the 60/40 portfolio is dead and how to beat the portfolio and not pay any fees or take on any risk. Ryan discusses the alternatives to the 60/40 portfolio and how to achieve similar returns with no stock market or bond market risk.

What is a 60/40 portfolio?

A 60/40 portfolio is a type of investment strategy that involves dividing your investment portfolio into two main asset classes: equity and bonds. The goal of this approach is to balance the potential for high returns from stocks with the stability and income provided by bonds.

Stocks, also known as equities, represent ownership in a company. When you own stock in a company, you have the potential to earn returns through dividends and capital appreciation, which is the increase in the value of the stock over time. However, stocks are also subject to market fluctuations and can be more volatile than other investments.

Bonds, on the other hand, are a type of debt instrument that allows investors to lend money to a government, municipality, or corporation in exchange for periodic interest payments and the return of principal at the end of the bond’s term. While bonds are generally considered to be less risky than stocks, they may not offer the same potential for high returns.

A few key information that are shared throughout the video from Ryan is that the Wall Street Journal has recently published an article stating that the traditional 60/40 portfolio strategy, which includes a mix of stocks and bonds, may no longer be effective.

Ryan talks about the Vanguard Balanced Index Fund, which has a 10-year return of 7.6% but also experienced a 22% loss in 2019. Many investors may not realize that there are alternative investment options available that do not involve the stock market and offer a 7% annualized return without any fees.

This information may be useful for individuals who are concerned about losing their life savings and seeking more secure investment options.


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