The Meb Faber Show
Welcome to The Meb Faber Show, where the focus is on helping you grow and preserve your wealth. Join us as we discuss the craft of investing and uncover new and profitable ideas, all to help you grow wealthier and wiser. Better investing starts here.
Chris Cole, Artemis Capital Management - You Want To Diversify Based On How Assets Perform In Different Market Regimes | #317
In episode 317, we welcome our guest, Chris Cole, Founder and Chief Investment Officer of Artemis Capital Management, which aims to transform stock volatility into opportunities for clients. In today’s episode, we cover the optimal portfolio to help you grow and protect your wealth for the next 100 years. Chris shares why recency bias has led investors to be poorly positioned for secular change. We cover the issues with the 60/40 portfolio and then walk through the five asset classes that he believes belong in your portfolio at all times. Then Chris explains how investors should think about diversification, and his new metric to help you do so. And of course, we talk some long volatility!
Key Points
- The traditional 60/40 portfolio faces challenges in the current environment due to recency bias, leaving investors potentially poorly positioned for secular changes such as stagflation or deflation.
- Chris Cole advocates for a 'Dragon Portfolio' that includes five asset classes - equities, fixed income, fiat alternatives like gold, long volatility, and trend-following commodities - to remain resilient across various market regimes.
- The 'Dragon Portfolio' concept was tested during the 2020 market volatility and demonstrated consistent performance, reinforcing the strategy's effectiveness in handling diverse economic conditions.
Chapters
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Transcript
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