[00:01] markets, most people think that you need to be an expert to build a good portfolio. You need to pick winners, time the markets, and constantly adjust your positions.
[00:13] But what if you could build a strong stock market portfolio using just four investments? And not only that, this portfolio is designed to grow your money and protect you at the same time. Now, let me tell you this. If you want the
[00:26] mainstream answer on how to build an ideal portfolio in the stock market, then you're going to be told the classic 60% stocks and 40% bonds. disagree with this. Like, that's just my opinion, and here's why. When the
[00:42] experts say that you should invest in bonds, that can include corporate bonds, mortgage-backed securities, etc. However, the recommendation is that the core of your bonds be in US Treasury bonds.
[00:54] So, they say this because it will produce some interest income for you, and it's going to be risk-free. In other words, 40% of your money is going to be safe in bonds, right? I'll tell you that I disagree because
[01:07] fixed income loses purchasing power during inflation. So, that safe 40% it it's not truly risk-free. If the true rate of inflation exceeds
[01:19] you're going to be losing purchasing power. And with Treasury bills and bonds, I mean, you're talking about 3 to 4%. And if it's not in a retirement account, then 3 to 4% is going to be your pre-tax
[01:34] rate of return. Now, I want to show you what I prefer, or what I would consider as more optimal or ideal. And just to be clear, I'm talking about viewing all of I'm talking about the combination of your
[01:48] 401ks, 403bs, IRAs, so basically your retirement accounts, and your taxable brokerage accounts. So, I'm not going to be including your primary residence, precious metals, 529 plans because that's intended for
[02:05] education, nor HSAs because that's intended for your health. With that being said, here's how I would structure my a whole. 50% towards S&P 500 index funds or ETFs.
[02:22] 10% going towards international stocks through an index fund or an ETF. 20% towards gold and using 20% as your opportunity And that's it, four investments. Now, let's break down why this works and why
[02:38] let's break down why this works and why most people overcomplicate this. the core, which is going to be the S&P 500, 50% of your portfolio. So, half your portfolio is going to go into the S&P 500 and I would use an index fund or
[02:51] an ETF. And this is going to be your foundation. Why? Because you don't need to pick individual stocks. It's because the S&P 500, like an index
[03:04] do that for you. So, if a company declines within the S&P 500, if you didn't know, it gets removed. If a company grows, then it can get added.
[03:16] the strongest companies in the market in a variety of industries. So, this is how you capture long-term growth without guessing. Next, we have international exposure and I would do 10% in international stocks and most investors
[03:31] ignore this. But, I'll tell you, by putting 100% of your money in one country, even the US, that's still a risk. Other countries go through different cycles and this is going to give you
[03:43] global exposure, currency diversification, currency diversification, and reduce dependence on one economy. So, it's not about maximizing returns, it's about reducing risk over time.
[03:56] Now, personally, I would use a fund or ETF for exposure to international And I would choose one that includes both developed and emerging markets. stable economies, so this is going to include Japan, Germany, United Kingdom,
[04:14] Canada, etc. Emerging markets are economies that are volatility. So, this is going to include China, India, Brazil, South Africa, for example. And by doing this, it's going
[04:28] to automatically give you diversification across regions, sectors, and currencies. Now, here's where the portfolio starts to look different. I would do 20% in gold.
[04:40] Most traditional portfolios barely include gold, so why hold it? It's because gold is your insurance policy when currencies weaken, gold benefits. This isn't about growth, this is about protection.
[04:56] So, I'm talking about buying gold on the stock markets, but I just want to use physical gold as an example. If you buy a gold coin and you hold it, then in 5 years, you're
[05:10] right? Like, it didn't go to work for you, it didn't multiply into two gold coins, like you still have one gold coin. But, the price of gold will most likely go up in 5 years because it requires
[05:24] more devalued dollars to purchase a gold coin. Okay, why? Because of all the money printing and Countries and central banks, and they can print dollars and currencies backed
[05:37] by nothing, but they can't print gold. Now, moving on, the final 20% I would say is your opportunity buckets. This is where you can take calculated risks, and you can allocate this into I mean these are just some examples.
[05:52] Let's just say silver, copper, uranium, oil and energy, tech stocks, REITs, real estate investment trusts, Bitcoin, crypto, you can keep it in cash, fixed income. I just just I just say just avoid treasuries.
[06:08] Or a combination of these. So, these are just again some examples. just again some examples. So, I'm not telling you to go crazy with wild speculation and lose money. I'm just saying that it's my opinion
[06:20] that it's okay to personalize your portfolio with your conviction plays. But, here's my rule. Keep your speculation contained to this 20% because there's a difference between smart investing and gambling.
[06:36] And this structure lets you take risks without risking your entire portfolio. this type of allocation actually achieve? And I'll tell you that it gives you growth through stocks, it gives you protection through gold,
[06:51] it gives you diversification because now you have international exposure as well And it also gives you flexibility through your opportunity buckets. And most importantly, which I believe that this is key, is that it helps you
[07:05] stay invested. So, personally, I would not try to time best approach is having a long-term mindset and keeping your money invested. So, yeah, there's going to be ups and downs, but the markets, I'm telling you,
[07:19] they're just designed to go up. Okay, why? It's because of all the money printing. All the money that's backed by nothing. They print, it causes inflation, asset prices go up. Listen, I want you
[07:32] to know this. If If there's a stock market crash and prices go down, then are they going to do? They're going to come to the rescue. They're They're to intervene. They're going to print money, and the markets recover
[07:44] and goes to new all-time highs. Like, that's how the system works. logically. Like, do you think the price of a home, like a median price home, will ever go back to $50,000 like they were in the 1980s? And then
[08:00] to happen. Do you think the price of a new car will ever go back to $15,000 like they were back in the 1990s? And the answer is no, of course not. Then why would stocks, gold, or any
[08:15] other asset crash 50% and just stay there? No, of course, that's not going to happen. It's inflation. It's the money printing. There's more devalued dollars floating out there. So, it's It's that simple.
[08:28] There's ups and downs, but you just need to stay invested. Okay, why do most people fail to build a good portfolio? Because, I mean, the strategy itself is very simple. And I would say that the hard part is
[08:43] actually behavior. People panic during downturns. They try to time the markets. They withdraw money too early, or they never start at all. complicated, but it's not. What's difficult is consistency and discipline.
[09:00] You know, sometimes I'd say less is more, and I like to keep it simple. You portfolios every day watching their phone, like, it's tempting to want to and trade like crazy, move things around, but it's dangerous if you don't
[09:13] Most industry standard portfolios look like this. They say it's to go heavy on stocks, include bonds, which usually means the bulk of it's going to be US Treasuries, and very little or no gold. Okay, why do
[09:27] they do it like that? And I'll tell you, it's because the system is designed around financial assets, not real protection. of the situation. Bonds are seen as safe, but in reality,
[09:42] they lose purchasing power in inflationary environments. And gold is ignored because it doesn't fit the narrative of Wall Street profits. So, the bottom line is that most industry portfolios are built to follow
[09:55] the system, not to protect you or maximize smart growth. So, the way I see it, this portfolio takes a different approach because it doesn't rely on one outcome. Instead, it prepares for multiple scenarios.
[10:09] Because you never know what's going to happen. If there's a period of growth, then stocks your stocks are going to perform. If there's currency debasement, then gold is going to protect you. For opportunities, your 20% is going to
[10:21] capture that upside. So, it's better balanced, in my opinion, and it's more diversified. So, I just want to conclude with this. At the end of the day, you don't need complexity to build wealth. You don't need to constantly trade.
[10:36] You just need a simple structure, discipline, and time. Now, if you want to see what I'm investing in, I encourage you to visit my Patreon sites. below. It's a community to learn, bounce ideas
[10:50] in our chat room, and stay on top of financial news. Thank you so much. I wish you a very nice day. Take care.