The Best Options Book And A Life Lesson
The Best Options Book And A Life Lesson
We have two lives, and the second one begins when you realize you only have one.
Asset management doesn't have to be difficult. We often try to make it too complex with extremely aggressive strategies and leave out the acronym KISS (Keep It Simple, St*pid).
One of the great strategies of all time fulfills the KISS premise, and this strategy consists of buying four assets and doing a rebalance one time per year. This strategy can be implemented in 1-2 hours per year and averages an average return of 4-5%. Yes, we are talking about Browne's permanent portfolio.
In a few weeks, we will share with you the synergies of the Bogle, Dalio, and Browne portfolios. But for now, I tell you that Browne's portfolio consists of decent returns and, best of all, very low volatility.
What problem do we see with this type of investment? It is an excellent alternative for people who want to preserve their purchasing power in the long term but who are destined to always need an external source of money.
If your job fulfills you and this is your goal, you can stop reading here because you will get an exceptional risk return.
But it is clear to us that we have two lives, and the second one begins when you realize that you only have one.
This is what the middle class aspires to. It wastes the first two phases to get to the last one with money but without health and energy.
Therefore, Browne's strategy is fine if you want to take 0 risks. A person investing in this strategy for 40 years can get very similar results to stocks but with infinitely less volatility.
The problem comes that 40 years of investing, implies being 65 years old (at best) and more than two-thirds of your life lived.
Rich-Young Alternative
If you are one of those who want to be financially free while you are young, there are other alternatives. They all have implicit risks, and, most importantly, you may not achieve financial freedom even if you implement them.
In addition, the possibility of losing a large part of your investments may be present.
Today I will give you a list of assets with which you can achieve freedom. We have classified these assets from higher-risk assets to lower-risk assets.
Be an Entrepreneur and set up a technology startup.
Invest in an altcoin or airdrop with a market cap of less than $10M.
Accumulate a lot of BTC and ETH, and hope that you will achieve that financial independence in the medium term.
Buy highly leveraged ETFs after a big recession.
Buy a lot of very OTM options.
Without a doubt, we would go with the last 3. We have included all three in our portfolio, but if we had to highlight any of them, it would be the last one.
Having many very OTM options with a very small percentage of your portfolio means that when a rare event happens, which it will, you are going to make a lot of money.
One of the most profitable possibilities is investing with very volatile OTM options. Volatility comes and goes when you least expect it, and you can be sure that sooner or later, it will come back.
The average investor's problem.
The big problem of the average investor is that he does not know how to use them to his advantage.
A very simple example would be. Imagine that there has been a great recession, and I have $100k in cash. The indices have fallen more than 50%, and the market is in absolute fear.
At that point, you could buy very OTM CALLs with a very long expiration and make your $100k work as $5M without exposing more than the initial $100k.
Undoubtedly this is one of the wonders that options offer us.
On top of that, imagine exposing yourself to volatility with 5% of that $100k, waiting for a recession and your $100k to become $400k, and right then, you can buy very OTM CALLs worth $20M. In just a few years, the money you would have been able to make would be something you and several generations would live on.
Today we will give our subscribers one of the books that best reflects what we are telling you.
+ 500 pages that you should read carefully.