3004: Risk Gets the Reward by Chris Reining on Investment Returns and Increasing Market Volatility

Optimal Finance Daily - Financial Independence and Money Advice

Optimal Living Daily LLC

Investing, Business, Education, Self-improvement

4.4 • 1.3K Ratings

🗓️ 13 January 2025

⏱️ 10 minutes

🔗️ Recording | iTunes | RSS

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Summary

Discover all of the podcasts in our network, search for specific episodes, get the Optimal Living Daily workbook, and learn more at: OLDPodcast.com. Episode 3004: Chris Reining's exploration of risk and reward illustrates how calculated risk-taking, as seen in Arnold Schwarzenegger's multifaceted career and real estate investments, paves the way for growth and success. He delves into tailoring investment strategies to personal risk tolerance, emphasizing the balance between safety and potential returns, and highlights the importance of long-term perspective in weathering market volatility. Read along with the original article(s) here: https://chrisreining.com/risk-reward/ Quotes to ponder: "Safety is fine, just be aware risk gets the rewards." "My intention was to minimize my future regret. So I split my contributions 50/50 between bonds and equities." "If there was a way to make money hand over fist with no risk wouldn’t everyone on the planet be rich?" Episode references: The Investor’s Manifesto: https://www.amazon.com/Investors-Manifesto-Preparing-Prospering-Rational/dp/0470505141 Tools of Titans: https://www.amazon.com/Tools-Titans-Billionaires-World-Class-Performers/dp/1328683788 Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	This is Optimal Finance Daily. Risk gets the reward by Chris Rining of Chris Rining.com.
0:08.3	As a kid in the 80s and 90s, I remember begging my parents to buy VHS copies of Terminator and
0:15.4	Predator, who didn't love Arnold Schwarzenegger? It's easy to forget, he got to start bodybuilding,
0:22.2	that it was only after winning seven Mr. Olympia titles he wanted to be an actor, and it was only
0:28.4	after becoming a bona fide action film superstar, he wanted to be governor. I'm thinking nobody has
0:35.3	three huge careers because it's the safe path through life,
0:39.6	and so he must have a very high risk tolerance.
0:43.0	This can only be learned through trial and error.
0:46.5	It was a little surprise then to discover he's a longtime investor.
0:50.7	From Tools of Titans, quote,
0:53.4	I felt if I was smart with real estate and took my little money that I made in bodybuilding and in seminars and in selling my courses through the mail, I could save up enough to put down money for an apartment building. I quickly developed and traded up my buildings and bought more apartment buildings and office buildings on main street
1:11.9	down in Santa Monica and so on. I became a millionaire from my real estate investments.
1:17.7	End quote. Schwarzenegger's life is a fascinating example of exposing yourself to risk and getting
1:23.8	rewarded for it. After all, that's what investing is. You get rewarded for exposure to risk.
1:30.8	That's why I'm always amused when people ask how they can turn $100 into a fortune without losing a dime.
1:36.9	If there was a way to make money hand over a fist with no risk, wouldn't everyone on the planet be rich?
1:42.8	In reality, there's only two sides to investing in the
1:45.8	market. Number one, stocks are ownership in a business with no guarantee of success. Number two,
1:53.1	bonds are loans to such a business or government with no risk other than the risk they go bankrupt.
1:59.6	How you approach constructing a portfolio of stocks and bonds
2:02.7	is how most investors control risk and reward. The rule of thumb is to invest your age in bonds,
2:10.0	meaning if you're 30 years old, you put 30% in bonds and 70% in stock. At 70, you put 70% in bonds and 30% in stock. To say that another way, as you age,
	...

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