Barbell strategy to build a portfolio with a $1m windfall.
The Barbell strategy is coined by Nassim Taleb. He is a Lebanese-American statistician, investor and writer and is well known for the term “Black Swan”. It refers to unexpected events at a large magnitude, such as Covid19.
The barbell investment strategy advocates pairing two distinctly different portfolio of investment assets – distributing between the two extremes with almost nothing in the middle.
The barbell investment strategy advocates pairing two distinctly different portfolio of investment assets – distributing between the two extremes with almost nothing in the middle.
One portfolio (85-90%) holds extremely safe investments, while the other aggressive portfolio (10-15%) holds highly speculative or leveraged investments.
The conservative portfolio should hold asset that can at least beat the inflation.
Depending if you are in the Wealth Accumulation stage or Wealth Preservation stage of your life, you can tweak the two portfolio accordingly.
Wealth Accumulation Stage:
The objective is to grow your wealth beyond this $1m windfall.
I would have 85% in the conservative portfolio.
Instead of low risk asset such as cash or short term deposit, I would allocate more into blue chip technology stocks such as
$Amazon (AMZN.US)$
$Alphabet-A (GOOGL.US)$
$Meta Platforms (FB.US)$
$Apple (AAPL.US)$
A portion of it will go into etf such as $Vanguard S&P 500 ETF (VOO.US)$.
I would also allocate 10% of the conservative portfolio to strong growth stock such as $NVIDIA (NVDA.US)$
For the remaining 15% in the Highly aggressive portfolio, 10% will be in $Tesla (TSLA.US)$ , 5% in crypto such as $Bitcoin (BTC.CC)$ and $Ethereum (ETH.CC)$ 1% can even go into meme stock coins such as a Moomoo coin suggested by @Mars Mooo or $Dogecoin (DOGE.CC)$ .
This is how the allocation will look like:
Wealth Preservation Stage:
The objective is to protect this $1m.
I would take a more conservative approach and keep some money as cash. The rest of the allocation will be very similar to the weakth accumulation stage, using a barbell strategy.
The conservative portfolio will be 90% and the aggressive one is 10%.
Quoting @NANA123" There is no best, only the most suitable “ strategy.
How you deploy the $1m totally depends on:
* Your risk appetite
* Your life stage
* Your investing style
* Your objective
I believe that using a barbell strategy can help me to meet the 4 points mentioned. The allocation % can be reviewed and adjusted annually if required. Most importantly, it should help me to sleep soundly at night.
Now…the question is….how should i get this $1m windfall?
Any ideas guys?
@Investing with moomoo @HopeAlways @GratefulPanda @Syuee @Tupack H Mcsnacks
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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NANA123 : win lottery![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
and invest FAANG![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
or gain the money in our dreams![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
NANA123 : I'm studying cryptocurrency recently.
Panda2102 OP NANA123 : Nice. Crypto can be very complicated. Pls share with us your findings
Mcsnacks H Tupack : That’s easy. Already did it in February.
Mars Mooo : Thanks Panda for @ me to your moment.![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
https://www.moomoo.com/en-sg/community/feed/107241902964742
For Mooers who might be wondering where to find the MooMoo crypto coin: it is not available yet, but we hope to see it, and trade it in the near future.
GratefulPanda : I like Nassim Taleb's black swan, but totally couldn't get his Antifragile haha. The barbell is a really logical strategy, the 85% cushion lets you "speculate" with the 15%![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
. As to how to get the 1 million, maybe we should all just tailgate Tupack's trades haha ![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
HopeAlways : The Barbell strategy does seem workable, so long as it is line with your investment thesis. As to how to generate the 1 mil, you could take reference from Tupack's stock recommendations.![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
Panda2102 OP Mcsnacks H Tupack : Very nice.
Panda2102 OP Panda2102 OP : Not sure what happened to the reply.meant to applause senpai TupacK
Panda2102 OP GratefulPanda : Taleb is a brilliant guy. Antifragile would mean stronger than resilient. In investing term I would interpret as company which survive and get stronger in any kind of crisis. I think.
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