🏋️‍♀️ Here’s How Jim Rickards’ “Banker” Invests His Own Retirement Funds

“Now you can invest the same way “The Banker” does for his family portfolio.” [The Rude Awakening] August 18, 2023 [WEBSITE]( | [UNSUBSCRIBE]( 🏋️‍♀️ Here’s How Jim Rickards’ “Banker” Invests His Own Retirement Funds - Why “barbells” make your investing stronger. - How you can split your investments into a “safe” camp… - … and an “aggressive” one without taking on too much risk. [CURRENCY WARS ALERT]( With Putin invading Ukraine…Rising tensions with China… Inflation, recession, supply chain issues, and the potential for greater violence is breaking out all over the world. It seems as if some of my worst fears have finally come true. [That’s why I’ve recorded this message from Pentagon City.]( To tell you exactly what you need to do to prepare for what comes next. Because if history is any indicator, soon…and I mean very soon… This war is not going to end well. [Click here to view my urgent message from Pentagon City.]( [Click Here To Learn More]( [Sean Ring] SEAN RING Good morning from the Thalys train heading from Paris to Amsterdam! One of the most interesting questions we get is “How do you invest your own retirement funds?” Luckily, Zach Scheidt, Jim Rickards’ “Banker” has already written out his answer. Not only that, but he’s given me his kind permission to reprint it in the Rude. In this piece, you’ll learn about Zach’s “barbell approach” and what kind of aggressive trades he uses to quickly expand his wealth. Take it away, Zach! All the best, [Sean Ring] Sean Ring Editor, Rude Awakening Twitter: [@seaniechaos]( [URGENT From Jim Rickards: Join Me LIVE On Friday Morning?]( Hey, it’s Jim Rickards… and whatever you have planned for this upcoming Friday at 10 AM Eastern, I suggest you cancel. Because I’ll be hosting a LIVE Zoom call where I’m going to break down my latest predictions for 2023. [Just click here now to see how to reserve your seat](. [Click Here To Learn More]( Here's How I Invest My OWN Retirement Funds [Zach Scheidt] ZACH SCHEIDT Back when I was a hedge fund manager investing millions of dollars for clients, there was one question I got asked over and over. It's the same question I get these days whenever I attend a conference or start talking with friends about the markets... "Zach, how are YOU investing your family's money?" It's a reasonable question. After all, my hedge fund clients of old and my current readers alike want to know that I'm putting my money where my mouth is. So am I really investing alongside my readers, customers and clients? Back in the hedge fund days, the answer was pretty simple. I kept the majority of my wealth invested in the funds that we managed. So when our clients did well, we also profited. Today, the answer isn’t much different. I also invest my own money in the same areas that I recommend here at Rich Retirement Letter. Let's peel back the curtain and take a closer look at how I implement these ideas with my investment accounts. Starting With a Balanced Barbell Approach At its most foundational level, I think of my investment approach like a balanced barbell with two very important sides. On one side, I keep my conservative, income-generating investments. The positions on this side of the barbell are designed to build wealth slowly and steadily with a minimal amount of risk. On the other hand, I also keep a portion of my investments in much more aggressive trades. These carry more risk but also have the potential for significant gains — often in a short time. At this point in my life, I have about two-thirds of my investments in conservative positions and the other third geared more aggressively. For reference, I'm 46 years old with a reasonable income that covers my day-to-day expenses. So I can afford to take a bit more risk with my retirement accounts. But as I get closer to retirement, I’ll shift more of my investments into the conservative side of the barbell so my risk is more balanced toward the season of life that I'm in. Each quarter, I take a look at the gains (or losses) on each side of the barbell. And I make adjustments so that neither side of the investment process gets too heavy, causing me to become too cautious or too aggressive with my investments. Once I make this strategic allocation for my overall investment picture, it's time to look at the positioning on each side of the barbell. Allocating the Income Portion of My Barbell The conservative side of my investment account is heavily focused on generating income. And I have two favorite ways to generate investment income. The easiest (and most low-maintenance) way is to invest in dividend stocks. These stocks typically pay quarterly dividends which flow directly into my investment account. And since I don't need these cash payments for my day-to-day expenses, I can have the payments automatically reinvested into new shares. This way, I continue to accumulate more shares, which then pay more income every time a new quarterly payment is sent out. I love this set-and-forget type of investing. But since I'm an active student of the market, there's an even better way to collect income on the conservative side of my barbell approach. You may already be familiar with the strategy of selling put option contracts for income. This is how I invest the majority of my capital on the conservative side of the barbell. When you sell a put contract, you're entering an agreement to buy shares of stock — but only if the stock is trading below your agreement price on the expiration date. Best of all, you get paid upfront for entering the agreement and you can collect payments on your favorite stocks multiple times a year! Just like any other type of investing, this strategy involves risk. But it’s actually less risky than a typical buy-and-hold approach. And I love the reliable cash flow this strategy generates. If you're willing to spend a bit of time reviewing your favorite stocks each week, I highly recommend trying this strategy out! Consider starting small with just one or two contracts until you get the hang of the process. Once you complete a few trades, I'm confident that you'll want to add this trading approach to your investment toolbelt. The Best Aggressive Trades for Reliable Profits I'm willing to take some bigger risks with the aggressive side of my barbell strategy. But I want to make sure my potential reward is worth the risk along the way. Over the last two-plus decades, I've been refining my approach to aggressive trading. I've found that my best returns come from buying in-the-money call option contracts from stocks I expect to trade higher and in-the-money put option contracts for stocks I expect to trade lower. These contracts work well when a stock moves in my favor, giving me nearly a one-for-one profit while muting my losses if the stock moves against me. Bottom line, these option contracts tend to give you more profit when your picks are correct and generate smaller losses when picks move against you. No one gets every stock idea right. But if you can trade in a way that gives you more profit when you're correct and smaller losses when you're wrong, it can go a long way in helping you grow wealth over time. In today's market, I'm placing some aggressive bullish trades on energy stocks, some healthcare plays, and a few select (and profitable) tech stocks. Meanwhile, I'm placing a handful of bearish bets on long-term Treasury bonds and unprofitable tech stocks. In-the-money option contracts give me a great opportunity to profit from the trades I get right while protecting my capital when things don't work out as planned. Find the Right Balance for You I'm not currently licensed to give individual investment advice. And that's not the business we're in here at Rich Retirement Letter. But here are some general principles that can help you use this barbell approach effectively to give you the income you need to enjoy this important time of your life. First off, if you've got several years left until retirement and an income that covers your day-to-day expenses, you can afford to be more aggressive with your investments. I still think it makes sense to have a large portion of your investments in income-generating strategies. But you can swing for the fences with a bit more of your capital if you've got your day-to-day expenses covered. Remember, the aggressive side of your investments can decline quickly if too many trades move against you. So don't get too concentrated on these trades and risk losing your investment capital! As you get closer to retirement, it makes sense to shift more capital to the conservative side of the barbell. That way you don't wind up with a nasty surprise if a few trades move against you. Preserving your capital in this stage of life is much more important than growing your wealth aggressively. Finally, don't forget to review your barbell periodically. A handful of winning aggressive trades could quickly double this portion of your investment capital. If this happens, you may want to move some of those profits into the conservative side of your account. That way, your profits are protected so you won't have to worry about giving them back. Incidentally, this barbell approach is a big part of the inspiration behind my Income Alliance trading program. The Income Alliance includes two real-money portfolios, each covering one side of this balanced barbell. Members get real-time notifications any time I make a new trade in my investment account. And they can decide if the trades make sense for their investment accounts. Stay tuned for more information about The Income Alliance in the weeks ahead. In the meantime, I highly encourage you to consider adopting this balanced barbell approach to your retirement investment accounts. Regards, [Zach Scheidt] Zach Scheidt for Rude Awakening feedback@rudeawakening.info In Case You Missed It… Train Travel Trouble [Sean Ring] SEAN RING Good morning Reader, Happy Thursday! The family and I are a few days into our Grand Tour, today we’re in Paris. I try not to wade into the mess of American politics… especially on vacation. But flicking through my Twitter feed — or X feed, rather — a bit of trading news caught my attention. If you don’t know who Tom Carper is off the top of your head, join the club. But digging a little deeper, Tom is buddy-buddy with good ole’ Joe Biden… and is a HUGE supporter of the president’s so-called “Bidenomics”. I can’t help but laugh. The man touts the resilience and strength of the U.S. economy — while actively betting against it. How is this even allowed? It’s so ridiculous, I have to take a break from relaxation to call this guy out. Because it’s not the first time he’s made money on something like this. Let’s dive in… [Urgent Notice From Paradigm CIO Zach Scheidt!]( [Click here to learn more]( Hi, Zach Scheidt here… I’m the Chief Income Officer at Paradigm Press. With inflation raging (and showing no signs of coming to an end any time soon), almost everyone in America is feeling the pain in a big way. Which is why, several months ago, I set out on a big mission… my goal was to create a [complete, step-by-step plan to surviving and beating inflation]( one that anyone could take advantage of. Today, after hundreds of hours of research, I’m revealing all of my findings. [Simply click here now to see how to survive America’s deadly inflation crisis](. [Click Here To Learn More]( [Dave Gonigam] DAVE GONIGAM Conflict of Interest Thomas Carper hails from the state of Delaware (no wonder he’s best friends with Biden). The democratic senator is also a senior member of the Senate Finance Committee. So of course, in public, this man praises the U.S. economy. Just in May, he attributed the apparent glowing economy to the president… “Thanks to POTUS, our economy is resilient and growing stronger every day. With over 250,000 jobs added to the market in April and our lowest unemployment rate in over 50 years, we are continuing to support working families across Delaware and the country,” said Carper. Lucky for us, senator’s stock filings are full public knowledge… caught you Tommy. His short bet was placed on July 13th. So it should come as no surprise that a senator like this praised the economy both the day BEFORE and the day AFTER his bearish bet. “Bidenomics in action,” says the man whose portfolio paints a completely different story. The trade in question was in the ProShares Short QQQ ETF (NYSE:PSQ), which is an ETF that moves opposite to the Nasdaq 100 Index. It’s a good investment for those that want to profit from a decline in the index. I mean, I can’t help but ask: when his own personal money is on the line, wouldn’t he be more incentivized for the American economy to fall? Especially considering Carper announced in May that he plans on retiring… so reelection isn’t a big issue for him. Even if he doesn’t directly pass any laws that would hurt the economy, being on the Finance Committee while betting on major indices falling? That feels a little too close to insider trading for comfort. And it’s not even the first time he’s done this. In March 2022, the US Senator invested around $100,000 in the same ETF and locked in a 30% gain after he sold it in October 2022. Then, in November, he purchased $110,000 of the Ranger Equity Bear ETF (NYSE: HDGE), which is a fund that shorts stocks — often used by investors to protect themselves against economic downturns. Of course, at the same time of these purchases, Biden’s buddy talked about how the commander in chief’s leadership was the reason for the “huge” increase in the economy… give me a break. Tommy is clearly full of it and willing to profit while the rest of America suffers. But this isn’t just a Democrat problem… Red and Blue Can Agree… on Their Wallets Senator Carper is easy pickings. It’s not just him that has a huge problem with a conflict of interest, though. The New York Times put together a good analysis on Congress’ trading habits. They found that at least 97 — 47 Dems and 49 Reps — current members of Congress bought or sold (or had immediate family buying and selling) stock, bonds or other financial assets that had to do with the work they do in Washington. Just look at this picture… [chart] The corruption is so balanced between Republicans and Democrats the picture is practically purple! (Take a peep at Mr. Carper up on the top right.) American lawmakers do not have to refrain from investing in companies whose stocks could be directly affected by the decisions they make in office. But it does leave a bad taste in your mouth. I mean, who can forget that after closed-door meetings about the pandemic back in 2020 (before the public had knowledge), many of their first instincts were not to try and protect the economy but to buy and sell stocks weeks before the market crashed. And despite 2022 being the worst market since 2008, politicians — on both sides of the aisle — beat the market. [chart] These politicians sure know how to trade! Pay Close Attention We don’t get real-time updates on congressional stock trading. So trading alongside them is a bit of an uphill battle. But politicians — not just in America, but all over — can’t help but show their cards eventually. Because if these people care about one thing over all… it’s making themselves more money. And those like our aforementioned Delaware senator give us some great insight: despite what he may be posting on social media about the strength of the U.S. economy, his heart (and his wallet) seem to be elsewhere. If someone on the Finance Committee is actively betting against America’s finances, I’m definitely paying attention and it doesn’t hurt to brace for impact. Take what they say in public with a grain of salt, their portfolios are where the real action takes place. Thanks for the peek behind the curtain Tommy! Let me know if you want any more information on this topic, or any topic that’s top of mind by emailing me [here](mailto:feedback@dailyreckoning.com). See you next week. All the best, [Sean Ring] Sean Ring Contributing Editor, The Morning Reckoning feedback@dailyreckoning.com Twitter: [@seaniechaos]( [Paradigm]( ☰ ⊗ [ARCHIVE]( [ABOUT]( [Contact Us]( © 2023 Paradigm Press, LLC. 808 Saint Paul Street, Baltimore MD 21202. By submitting your email address, you consent to Paradigm Press, LLC. delivering daily email issues and advertisements. To end your Rude Awakening e-mail subscription and associated external offers sent from Rude Awakening, feel free to [click here.]( Please note: the mailbox associated with this email address is not monitored, so do not reply to this message. We welcome comments or suggestions at feedback@rudeawakening.info. This address is for feedback only. For questions about your account or to speak with customer service, [contact us here]( or call (844)-731-0984. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. 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