Want to create an interactive transcript for this episode?
Podcast: The Meb Faber Show - Better Investing
Episode: Michael Philbrick, Adam Butler, and Rodrigo Gordillo - It's About Risk Allocation, Not Capital Allocation | #17
Description: Episode 17 starts with the guys from ReSolve discussing how they view asset allocation and top-down investing. They start with the global market portfolio which is the aggregate of what every investor in the world owns, yet interestingly, nearly no individual investor allocates this way. They then adjust the global market portfolio by striving for balance, specifically, risk parity. They discuss how leverage enables an investor to scale risk and target a specific volatility level, therein equalizing the portfolio. Risk parity gets you to start thinking about risk allocation instead of capital allocation. And this is helpful as “you’ve alwa...