Financial Engineering The Art of Diversification in Modern Investing - Financial Engineering Podcast With Mark Anderson Multi Strat Mark

Unpacking Return Stacking and Diversification with Futures Everyone, welcome back to another episode of Financial Engineering, How to actually make money with myself, Connor, and Jordy, 3 people from all over the map. So we talked about buffer ETF last time and we kind of got into the concept of return stacking. I'll leave it up to Connor and Jordy because they did the homework. If you guys have any questions about return stacking or if you just want to kind of explain what you learned from looking at resources basically. Speaker 2 Yeah. The first question I had is I was looking at the example I, I kind of got the concept of like you're, you're diversifying your portfolio, right? And I think that is something that made sense to me, but something that didn't really make sense. Speaker 1 When you say diversify the portfolio, like how are you diversifying because you like you're diversified if you're in half cash and half? Speaker 2 Exactly. So that was, I think that's my overarching question is when we first talked about about this, I think about being diversified in the stock market. You know, like I, I thought the concept was we're already return stacking by if we buy SP and then we go to trade options, we we borrow and then go to trade options with it. That's what I thought the return. So I think I was confused on the concept when you first brought it to weeks. I was like I thought we're already returned. Speaker 1 And this is a form of return stacking, but I'm glad you brought that up. So like I guess what I'm showing is like return stacking with SP and options. Options as a form, but there are also low cost ETS for people that don't know how to trade options that can implement the same thought process. Obviously not directly with options, but with other options like a future or bond or something. Speaker 2 All right, makes sense. Speaker 3 And I want to share that I had the big aha moment because when you were talking about futures, Mark, I always thought it was, you know, I've always done ES or MES. So I thought, what's the point of holding SP Y if we're going to hold the SMP futures? And then, you know, you told me and then I realized that it's not SMP futures, otherwise it's pointless. So it's Commodity Futures that on other futures, currency and stuff that are completely uncorrelated. And then that made sense because then we can borrow against the SP SPY and then we can use that to do something else on top of that. But as you said, we're lazy. No, it's not a matter of being lazy, but to manage the futures world, it's a nightmare. Exactly. Exactly. I mean, good Lord, Yeah, Yeah. It's like, so happy to pay somebody to do that for us. Yeah. Speaker 2 That was the light bulb moment for me. When Jordan has explained that to me, I'm like, all right, so we're holding a correlated, we're, we're investing in something that's correlated to the market and something that's correlated to the market. And when you guys were explaining those futures, because I had the same question that Geordie was, I was like, when I hear futures, I hear you're just learning how to trade futures. So I didn't understand the difference in that as well. Speaker 1 Yeah. We're not day trading. We're like contracting out a systematic diversified form to futures. How Uncorrelated Investments and Futures Diversify Portfolios So I kind of wanted to go in and like show you guys some stuff. So it's like, what are the things we look out for uncorrelated investments we've gone over? Do you guys remember 3 things to kind of look at where they. Speaker 3 Beta. Speaker 1 Beta. Speaker 2 Oh yeah. Speaker 3 Alpha. Yeah, Alpha. Speaker 2 And then was it? Was it correlation? Speaker 1 Yeah, and correlation. So this is how most people, and I've gotten some questions about this, will like look at an asset allocation. So or like the Colonel line item in the financial advising space. So this is a popular managed futures ETF called DBMF. What most people do is they'll say, hey, like we should buy some DBMF and then everyone will come in back, test it and they'll say I'm getting 11% in SPY and 8% in something I don't really understand. And the sharp ratio is higher. Like stocks go up, I'm owning S&P. And then someone that's more conservative would say, hey, look, one zigs from the other zags. It'd be good to be diversified in your portfolio. You hold on to this for two years, you decide the S&P is better, you dump your DVMF for futures, and then you basically end up getting whip shot with this, you know, 25% drawdown basically. So this is where most people struggle. But the point I'm trying to make is we're not going to choose to managed futures or S&P, we're just going to have both in a more capital efficient manner. So the way I kind of described is like we want you to have your S&P exposure and your diversification so you can have your cake and basically eat it as well. Does does that kind of make sense? Speaker 3 That's so awesome. That's really awesome. And this is because of span margin, right, Mark? Speaker 1 Yeah. So basically like if you're going to hold a future, you basically have to put up 10% of the collateral. So like the make up of stocks in, you know, managed futures would usually be like 80% in SPY a little bit to make up the 20% exposure with ES for 100% exposure in the index. And then basically the other 20% of the capital would just be collateral, the whole commodities like gold and oil and then currencies like the yen or interest rates or something. Speaker 2 Yeah, I see that the correlations, like I've never seen a correlation that low before like. Speaker 1 Completely. What do you think a a negative .3 correlation means? Connor? Speaker 2 Would it do the opposite of what the market does? Speaker 1 Yeah, about how many percent of the time? Speaker 2 38%. Speaker 1 Yeah. So basically, like this means that when the stock market goes down, this will mostly go up. This makes sense because commodities cost more money, profits go down. And the other thing I wanted to make with this is so the S&P or the stock market is what's called a capital formation market. So basically it's where companies go to get financing and debt for people invest in companies so that they hope to get a higher return in the future. Whereas the commodity market is what's called the risk transfer market. So if you're Exxon and you're refining a bunch of oil, you will go into the commodities market and go short or long oil with the sole purpose of trying to lose money on that hedge. And that is a different form of risk premium that people will go long or short. That and the reason companies are fine with losing that money because if Exxon can get rid of some of its risk from the price of oil going up and down, their stock price will go up more than what they lose on the hedges. Because like futures is a negative sum game. Like it costs money to get into the contract and one party loses when other party wins, but the goals of other parties are different because they can benefit in other aspects. So that's kind of why. Like this is essentially what Exxon is trying to do is they're trying to lose money on their hedge so they can make money on their balance sheet bags on. Speaker 3 And this is because also we're doing this because we're like reducing volatility drug and Shannon's demon, that sort of thing, right? That's why it works so well. Speaker 1 No one zigs one another zags. So it's like this 17% drawdown is probably coming when the S&P is at an all time high. This 23% drawdown is probably coming and we could just really quickly kind of give a comparison of 50% DBMF, 50% SPY and we can just compare this to the full index basically. So you saw the index had a Max drawdown of 23%. You went to 6% drawdown and you know you're still underperforming the S&P, but you have half of the volatility and 1/4 of the drawdown. This isn't how it works perfectly every time, but just kind of getting you guys a little understanding of what that is. And ultimately we get what we're really searching for, which is that that all amazing alpha of basically point 6.73 basically. Navigating Psychological Traps and Sticking to Your Investment Plan Does that make sense? Speaker 2 Yeah, I'm, I have a quick question where I can. Again, I'm not trying to put you in a bad spot here by asking you this question, but I'm just saying as a, as a guy like me, I look at that and I'm looking to invest my money very strategically, but also with very low risk because obviously I want to be smart with my family's money. Is this something because to be honest with you, I just look at it as if my goal was to return 10 to 20% on the money that I put in something and have low risk. Would you say this is a lot more low risk if you were to do both of these together then just put it into SPY because like or just multiple ETF? Speaker 1 Yeah. So this is where like psychology and stuff comes in. So like we talked about this on the buffer ETF. So you only get the return that you're actually invested in and you can stay invested in. So like from a losing money perspective, this could be easy. But you can also see from like a FOMO perspective, it may not be that easy to hold because you know the S&P to 25% in 2024 and you did 16 and 2023 the S&P to 26% and you did 8. So the point of. Speaker 2 That someone that's like, I'm fine with that knowing that like I have that volatility drag, you know what I mean? Like knowing that like I might be trading, being smarter with my money makes me feel more emotionally like. Speaker 3 I'm right now it's going up. We're going to have the volatility drag when the S&P is going down. When you're going up, you go like, what am I doing doing this stupid futures things, right? So and I could have been making 20%. That's that's the psychological trap, you know, like. Speaker 1 You're, you're the enemy for this. So it's like you're buddy is going to say, oh, I'm not big and you're going to be like, damn, like houses are getting more expensive and I'm only up 8%. So like the underlying key to all this is like you need to be educated enough to where you feel comfortable. You're like, I'm underperforming the market for the last three years because I don't want to experience that 18% drop. That's basically what we're going for. And then we can look at like a back test going back to 2007 and like, you know, you see it, it catches up a lot of the times and then you know, you'll run really benefit some of the times as well when you look at 100% stock and 100% manage users their stock. So the the main thing is like you need to have this buy in with yourself and your family so you can stick to it. And then you need to do the work to understand it. But then we're going to contract out the work to implement the strategy. So, you know, we don't have to worry about it to, you know, a third party, which would be basically. Speaker 2 100% like, yeah, I would much like to your point, I'd definitely be contracting it out because I would not be trying to manage that myself. Speaker 3 Yeah. Speaker 1 Exactly. They're like, the main thing here is like, what's your allocation? And there's not really a wrong answer. But like for you, Connor, you may say I want 7030, you know, yeah, which would be a different allocation. And you look at this and you go, oh, like, OK, I'm really uncorrelated to the index now. Like I kind of like that because maybe you think the market's frothy. Or if you go 70% S&P, 30% futures, you can be like, OK, my return's higher now and I'm very correlated to the index, but just. Speaker 2 Trying to figure out what your appetite is. How to Automate and Diversify with Multiple Investment Alternatives Basically, yeah. Speaker 1 And then the main thing with this is like you're going to automate it and then you're basically going to stick to it like in the future. And the other point that I kind of wanted to make here too is like when you hold a future, you're basically, you know, paying the risk free rate of like 4% on when you do it. So if you weren't return stacking and you just put $200 to work, you're basically return or risk adjusted return would be a little bit higher. Whereas when you factor in, you know, the additional borrowing cost of basically 4.4%, you are going to lose a little bit of the smoothness because it costs money to basically hold those futures. But when we have low interest rates, I just want to show you that like that little bit of drag that you get from the financing cost or borrowing the money is kind of worth it. And here's kind of the calculation that you have. Speaker 2 Makes sense? Speaker 1 And then do you guys have any more? Speaker 3 I I have another question. How many things can we stack? Because for example, let's say that we do some sort of like automation 0 DTE, very low risk. We're aiming for a very low alpha. I mean, how many high? Speaker 1 Alpha. Speaker 3 But yeah, no, no. But I mean no, no, no, I mean like low alpha as in like super save. I don't want to break the bank. I don't want to have a drawdown. So something easy, you know, maybe selling a very far out of the money put or put spread or something. How many things would you stack? Like when we do a return stacking, if we do like SPY and we have one of these managed features And then would you still do some active options trading or not at all? Or how many would you say it's an optimal number? Speaker 1 I mean, so like literally basically as many as you can for most people out there, like that's probably not the best advice because you have to understand it. So I would say like start with one. If you could add a new one every three months that would be like OK but like for me since I do 1. Speaker 3 Sorry, one what 1 strategy or one one? What do you mean 1? Speaker 1 Alternative. So like SPY manage futures would be like where people start. Like obviously I'm going to do SPY, manage futures, rates, yen, carry options, zero DT, like calendars. I'll do like 35 things because that's what I do for a living. But we, you guys need to basically do what you can with where you're at. And you have to take baby steps. And this is what everyone sees is they're like, maybe see what I'm doing and they have to do it all. It's like just from one thing like your, your Max benefit of diversification will come from 1:00 to 2:00, then two to three, then three to four. And as you get from 8:00 to 9:10 to 11:00, that benefit will go down more and more. And you may not even realize it until we get a 2020 or 2008 scenario. Speaker 3 Yeah, No, no, makes makes sense. Speaker 1 So do you guys kind of have anything else in regards to return stacking that you guys want to talk about in a little more detail or I can kind of answer some questions about, you know, actually we have a paper here I can maybe this guys will help everyone understand it a little better. Speaker 3 So Oh yeah, that paper is awesome. Speaker 1 Yeah, the return stacking website. So this basically shows what the current holdings are from Q4 of 2025. So you can see it's holding two year, five year, 10 year and then some euro bonds and I believe the Guild is the UK bond. I'm not that sophisticated, but you can see that within this managed futures thing, we have basically six different bonds and equity indexes. We still hold the S&P, but you also hold the NASDAQ Euro UK, which is the FTSI, the DAX, which is German and then Japanese as well. So like this is 12 things that you're getting for basically 1% expense ratio in the return stack. And then in commodities, you can see we have American crude, basically British crude, refined gasolines, natural gas, gold, silver and copper. And then in currencies, we have Australian, British pound, Canadian euro and yen. So you're getting a lot of diversification with this. This is why it's basically 0% correlated. But a lot of these things will often not all be in favor at the same time. So commodities generally have much shorter cycles or futures have much shorter cycles with much less draw downs. And then equity markets generally have much longer like cycles like maybe a decade bull market and they have much steeper draw downs and much longer draw downs for potentially 10 years. And generally these will offset because an example of how they're offset is if the the American stock market got really weak, we may weaken our currency, which the futures would short the currency and make money off the currency going down, which would also help potentially the American stock market from getting a weaker dollar or such. Speaker 2 Makes sense. Yeah, so. Speaker 3 Like is this liquid like are these like ETF liquid enough? Like we don't have to worry about that they. Speaker 1 Choose, I mean they do it for us and they choose basically the 20 most liquid futures that are out there. So like they're not treating lean hogs or like cattle or something that's really obscure like zinc, something that's like not materially important. They're trading stuff like currencies and. Speaker 2 How does that relationship work? Like do I just go into the and just trying to wrap my whole mind around it is do I just go into the portfolio visualizer that you just had to figure out what appetite I want to do, run some back tests on that, become really educated about it and then go to a company like that or a fund like that and just say, hey, here's what I want to be allocated wise. I want 70 in SPY and 30 in these bonds and then they just run it for you. Maintaining Your Desired Asset Allocation Through Strategic Rebalancing Is that kind of basically what it is? Speaker 1 Yeah. So like what I just showed you is what that ETF is running. So like all you have to do is buy that ticker, like this ticker is RSST. So you can say you can automate it in your brokerage platform or an M1 and you basically say hey for every time I deposit money I want 70% to buy STY and I want 30% buy Rs. Speaker 2 Well, that's even easier and. Speaker 1 Then also like if S&P goes down and like RSST goes up, it'll buy more SPY during that like inflow of capital. So it continues balances now between 70. Speaker 3 So you would rebalance Mark? Sorry, I didn't understand. So you would keep rebalancing it. Speaker 1 I want to automate it. So like I just automate 7030 and every time money comes in for my paycheck, like every two weeks, it may buy them equally if they both come up. If S&P went down a lot and the futures went up a lot, it would just buy S&P that much basically. So you're kind of keeping a static performance. What I showed you in Portfolio Visualizer shows a yearly rebalance, which you don't want to sell out of these things on like a monthly basis because then you could realize the tax consequence. But if you're constantly depositing money out of your paycheck, basically dollar cost averaging, it's going to naturally maintain that 7030 much more. Speaker 2 How I I was writing down that ticker. How, how did you say that you are rebalancing it? How are you automating that? Speaker 1 So like rebalancing, I would only do like yearly, but most people since you work, unless you're completely retired, you're going to be investing every month. Like every time you have a paycheck you may allocate a couple grand. So when it goes into that account, it would basically say right now you're 68% invested in SPY and you're 32% invested in RSST, the futures thing. So it'll buy a little more SPY instead of futures. So it keeps around 7030. But if you were. Speaker 2 When you put those filters in there, it's like a stopwatch filter or something like it basically just keeps it right at the 7030. Speaker 1 And if you were retired and maybe don't have as much income like Jordy or all your investments, all your income is from investments every year, you would just go in and say, OK, I'll I'm at 60% stocks and 40% managed futures. I'm going to sell 10% of my managed futures and buy 10% more in stock. Mason like it's, it doesn't move near as fast as zero DT, so it's not going to be a huge deal. But for the confines of how most people invest just rebalancing it yearly. Or you can kind of see in the back test like if we have a 60% allocation to futures and a 40% to stock for a 40% allocation to stock and a 60% to future, the returns actually pretty the same. So you're really not that freaked out if you get too heavy in one or the other. Now, if like 2020 happens, you may want to rebalance because you've lost like 35% of your balance in your stocks. Speaker 3 But why real? Why rebalance at all? Why not just buy and hold what you bought and forget about it? You can also do that. Speaker 1 So like an example would be like imagine you got into managed futures in like 2022. So like, futures had a really good year in 2022, stocks did not, and you got it at the end of that. Futures have been barely positive, like 4 or 5 cent, and stocks have been up 25% a year. So like your initial 6040 allocation to stocks, bonds, I mean stocks, futures in 2022 could now be 85% stocks in 15% futures, which may not be an allocation you want. So like the point I'm trying to make is like, if you make a plan to be 60% stocks, 40% futures and then you never touch it, five years from now, you could be 90% stock and 10% futures and then the environment changes and you go, oh, whoops, like that's not what I wanted. You know, this is basically like, I would equate it to like you made a plan of how to get in shape and then you followed it for a month and you were like, I'm now in shape and you just stop working out. Like that's obviously not how you do it. Now. There obviously is a point. It's like if you're rebalancing 5%, that diversification is probably not even worth the tax you would pay on it. So like you have to use, you know, some, some logic of what you're doing. But if now you're 30% bigger in stocks, first chance futures, diversification is probably worth the potential tax consequence you have. And also by doing this, despite what people think, stocks will eventually go down. So when you're selling the highs and reallocating the stuff of the lows, it's also a way of taking risk off the table because even if you you're up 30% in stocks, that's unrealized because you have not sold it. So like if we get that thing that comes down, all that gain you had for three years is now gone instantaneously and you don't have the diversification that you set out to start with. Speaker 2 So if that's the case, can you can rebalance whenever you want though too, right? Like if I mean, I guess. I guess this answered my own question though, because let's talk about the. Speaker 1 Way to think of. Speaker 2 It. Speaker 1 If you are dollar cost averaging and you're a current working professional and a majority of your incomes comes from work, it will automatically rebalance for you because you're investing every month. If you're like Geordie that's worked your whole life and the majority of your income comes from investing, then you're not adding more to it. It's you're only making money off the appreciation stuff, then you need to be someone for rebalancing. So like for the confines of Uconnor for the next decade, you will never need to rebalance because you're contributing to it. For what Jordy's doing, he should probably be keeping an eye on it every year or so. So like your dad who's retired would look at. So basically the way to think of it is like, where's your income coming from? Is it coming from work or is it coming from investments? It makes perfect sense. Your income's coming from investments. Do you need to think about rebalancing? If your income's coming from work and you're actively investing, you need to think about doing it today. For me, you know, I have a lot of basically 100% of my income is investments. So like I pay attention to rebalancing like a lot. Whereas someone that makes more money at work, just focus on work and you know you you'll be diversified. Speaker 2 That makes perfect sense. Yeah. Yeah. Because that was just, that was going to be my question, but you answered it. Yeah, that makes perfect sense. Practical Portfolio Construction and the Pitfalls of Curve Fitting Yeah. And then do you guys have any more questions or anything that maybe you want to cover next week or I could explain something else that we could go over in more detail as well? Speaker 3 I think the practicality of it, like how to do it, like how to actually do it. That's the thing that at least, I mean, I love the theory, I love to listen to these things, but then it's like, how do I do that? That's that's the and you're giving us some. Speaker 1 It would be like a test. So like we can kind of go with the flavor of what we've been working on. So like we also did this TQQQBTAL thing. So like let's cut our allocation. Actually let's keep this at 20%. We'll go down this to 50%. That leaves 30% less 20 and 10, that would be 100. So like this is kind of our loosely working portfolio right now. You know, we can change allocations, but this is kind of the idea basically right now. Maybe we want to allocate to more futures, but these are the four things we've looked at thus far. Speaker 2 And it's still a little less correlated. I saw that it's still at .88. So we're not completely correlated to the market. So that's good. Speaker 1 Yeah. And the main thing is we limited that draw down. So what what this tells me if I'm reading the tea leaves, even though our correlation is really high here, this shows me that we're correlated when the market's going up, and when the market's going down, we're not that correlated, which I'm fine with. Speaker 3 Yeah, so what's the alpha? Speaker 2 Market by a percent, you know. Speaker 1 And then we already asked what our alpha is. So if we look at the alpha, our alpha is 5.3% annualized. So pretty good. Speaker 3 That's not bad. That's really, I mean that This blows my mind. This is really awesome. This is like, really like free money. Speaker 1 This is very curve like. It's not super curve fiddy, but this isn't necessarily how the market's going to behave in the future. And here's another metric too a lot of people probably haven't heard of, which is R-squared. This is, I believe it's like the coefficient of determination. So you can see that our correlation is .88, but the SPY, which is our coefficient of determination is only basically .76. So this is kind of another way to check correlations where you're like it says .88, but it's actually. Speaker 2 .7. Speaker 1 Yeah, or it's in between these two numbers is kind of a way to think of it. And then like a really, you know, curve fiddy thing that some will show is like if we save this portfolio as test 1 and then this is what I would never do. And then you go to tools and you go to like portfolio optimization, you'll basically, you know, upload a. Speaker 2 Test 1. That's right there. Speaker 1 Test 1 And then you go let's optimize this. And then it goes like boop, boop, boop, boop, boop and it says that. Speaker 3 Is curve fitting. That's the definition of curve fitting, right? It's like. Speaker 1 This is very curve fitting because it's like we don't know if commodities are gonna have a 2022 and like this isn't like options where the probabilities priced in. So like this is something I would never do. So I'm not really looking for this which is optimal. So you can see here it's like, oh, the maximum sharp look how much more money we make and we don't even take our worst year is .59. So that's what I would not do and that's not how equities work with like balancing those asset allocation. So we're just trying to find something that's like I want to have some allocated to futures, I want to have some allocated to the market. I want to get some capital efficiency with our, you know, B Tau TQQQ thing. And the main thing is just like I want to keep up ish with the market and I want to be down way less than the market so I can stick to it. Speaker 2 My last question is, and I'm not trying to curve it either here. I think my question is how do I figure out what to allocate like percentage wise like well, how do I figure out what is? I mean, I'm sure there's a lot of emotional on that as well, but also just to be optimized like what is? Aligning Investment Decisions with Your Unique Financial Goals So this is the thing. I actually had a conversation with the guy that's in my find the other day. So like the way I think about asset allocation is it's like this is like your health. So if you go to, if you have a broken ankle and you go to a like foot surgeon or if you go to, I think they're called like osteo, something like bone surgeon. Yeah, osteopath, they're basically just going to look at everything and say I'm going to fix this. It's like surgery, surgery, surgery. And if you go to like an ankle doctor, the ankle doctor may say, oh, I'm specialized in ankles. This ankle doesn't look that bad. You can wear boot and you'll rehab it. You don't need surgery. So it's like the only person that can make that decision if you're going to go like wear a boot or you're going to get a surgery is you. So like no answer is wrong of what you do, but like you have to own your medical decisions 100% and it's your responsibility to get multiple opinions and you have to own your investment positions 100% and it's your job to do that. So if Connor you were allocating for your kids college, which have 16 and 18 years to go, I would probably be more aggressive in equities. If you are allocating spare capital so that if you were to lose your job, it most likely would not occur when your investment account is also at an all time low. I would probably allocate a lot more conservative because when you lose your job, it probably means the overall U.S. economy is down is down, which is the S&P. Whereas commodities in your job, unless you worked in oil or something Connor are probably not correlated to that. So like I, I don't want to be you guys through I'm giving you the information of a foot doctor and an hospital and it's your decision to own this because you have to live with having the surgery and getting potentially getting staph infection, doing whatever. Or it's like, you probably go for surgery if you're a pro athlete because you need to be perfect. And you probably go for rehab if you're a regular person because you're just wearing a boot for through yourself. And so like, I'm not here to answer what you should do. And like Jordy, as we've determined, has a very different goal. And you, Connor, and you have to decide what these are. And when you educate yourself and you decide what these are, you'll stick you know where it's like. Speaker 2 Yeah. Speaker 1 So. Speaker 2 I'm running these back tests on that portfolio analyzer trying to figure out. I think your examples were perfect. Like I have a call I want to build a college fund for my girls. Let's go be high risk on that. When I figure out what are some good high risk ones that will yield more, but also are playing into the theory that we're talking about right here. And then I have like a retirement one. I probably want to be a little bit more conservative with that or just with my star savings as well, you know, because I know over 40 years that's going to yield, you know, so I don't need to be super risky with that, but I can play more conservative with that. So that's kind of just like just figuring out where you want to be in that and then that's where. Speaker 1 Yeah. And I want to make like a key distinction with like what Connor did is like Connor was asking me as like a source of authority, but that doesn't matter if Connor's not bought in. Whereas the more like helpful thing with Connor being like, I don't really know how to allocate to these. I need to spend more time to understanding what this is and more time back testing basically what I'm doing. And I get this with everyone on YouTube too. Like I showed that TQQB Cal D Tau thing and a bunch of people were like, boom, I'm allocating to this. This is genius. And then another group of people were like this underperformed in 2025. Why on earth would be allocated to this? This is done, you know, or people would say, why on earth would I allocate to futures? Because it doesn't even beat the S&P and other people go, this is great. It almost tracks with the S&P and it protects me from drawdings. So like you guys need to like have the spark curiosity of where you wanted to go and what you want it to be. And I think this also like kind of equates back to life where people will just get in the job, say they wanted a job as an insurance agent. Me and Connor talked about this earlier this week. And then you just keep, you get the job and then you just adopted that identity and then five years from now you go, wow, this job sucks. Why I've been doing this. Whereas when you're keep evaluating or rebalancing every quarter of like this belief served me for six months and now it no longer serves me because I can't be at home as much. Like I got enough money to get my family in a new house and I've saved 50 grand, but like now I can't spend time with them and I don't need an extra 50 grand. So like, I'm going to change what I'm doing and allocate more to futures. So you have to make time to think about this and you know, basically have different points of view of what. Speaker 2 I like that. Speaker 3 And I was thinking even if we take a step further back, like I think a lot of people in my age, yes, and not that young, like we have been doing a little bit of real estate. I mean, as I have been making a little bit of real estate, I've been I've been a business Angel and I've been doing like, you know, some seat investments in some startups. And then we could even do that financially. Like I could just buy a wreath. I could just, you know, I could even take a step, a further step back and just all the pain I've been going through the real estate, yes, it's profitable, but it can be a pain in the US. So you just buy a read and then now you just buy a read for data centers if you are in the AI thing or you just buy and you can just have that as you say, like return stacking. And I think that is that's why I'm blown away by all this, because it's so passive yet so active. What's behind that really blows my mind. Speaker 1 Like like this is a scalable thing. Like all the work comes on the research at the front end and then once you automate you're basically good. Speaker 3 Exactly. Speaker 1 And the mistake that most people make is, you know, I say they should all over themselves instead of shit, they should all over themselves. So they say I should allocate to this, I should like save more money. And it's like you're just going to should yourself and you'll be, you know, shouldn't where you sleep eventually. So like, do and take some time to do it and it doesn't happen overnight and you are going to make some mistakes along the way. But if you make mistakes that you learn from and aren't that big, it's not. Speaker 2 Oh yeah, that's, I think that's a great point, especially for someone like me, like I'm, I still have a lot of time to invest all this stuff. I can either say I, I should, you know, learn all this stuff, or I can go learn it now in a year from now, like maybe take a year to really study it and understand where I'm going to allocate everything, allocate it, say save money, allocate it, and then just let it. Speaker 1 And it's all about kind of changing your system. So like like I'll link the podcast. So like these returns that guys have a podcast and you can allocate to it what I call net time, no extra time. So like when you're in the car driving somewhere, you can listen to the podcast, no extra time. So it doesn't cost you any more time than you're doing because it's like freedom time. But we're at 35 minutes. We'll end it here. We'll come up with a new talk for the next one. I think we'll pause and just do AQ and a from all the episodes. If you guys have questions, put them in the bottom or if there's something you want us to cover, we can do that. Like subscribe if you like this multi Strat mark rebranded. We're branching out here, so hope you guys like this stuff. Thank you.