Our allocation to risky assets should vary based on the expected return, volatility, risk aversion, and how much we can earn risk-free. That means we should be taking less risk right now. Listen to learn why.

Topics covered include:

Why there are so few billionaires
Why did the hedge fund Long Term Capital Management implode
Why how much to invest is more important than where to invest
How the Merton share formula can assist with determining what percent of our wealth to invest in risky assets
Why are expected outcomes so much greater than the median outcome and why that matters to our investing

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Show Notes

How to avoid a common investment mistake - Buttonwood - The Economist

The Missing Billionaires: A Guide to Better Financial Decisions by Victor Haghani and James White

Money For the Rest of Us List of Most Influential Books

Charles Feeney, Who Made a Fortune and Then Gave It Away, Dies at 92 - New York Times

Elm Partners Coin Flip Exercise

Evaluating gambles using dynamics - O. Peters and M. Gell-Mann

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Money For the Rest of Us