Barbell-finance-strategy

Since more than 20 years I invest my money in various ways:

  • Public and corporate Bonds
  • Fixed term deposit
  • Closed-end-funds
  • Shares & Fonds
  • Options & Derivates
  • Real-estate
  • Direct investment in companies

Looking back to my finacial track-record is quite sobering. Overall the performance have been 3%. But the resultats of each investment vary a lot. To my suprise the „100%-safe-bets“ and the „very-risky-bets“ had the best performance. All other investments „in the middle of the road“ have been dissapointing / sometimes devastating.

My best investments „100%-safe-bets“ (probability-of-default< 2%)

  • I have bought in 1999 German Bonds with a high yield and held it until termination, 7 years later (8% p.a.)
  • I have bould an appartment in 2011 in Frankfurt and since than the prices have been rising 7% p.a.

My best investments „very-risky-bets“(probability-of-default>40%)

  • I borrowed several times money to a friend. Every time I was convinced, that I never see the money back. Every time I was wrong. No earnt interests, but a good feeling. What is money for, if not to help a friend?
  •  I invested in 3 companies that my wife or I have started. Noone would have done this (very risky). The return is a multiple of my initial investment.

Lessons learnt: 

  • Nassim Taleb descibe this invetment-strategy as barbell-strategy: Don’t go for medium risk-investments. Try the super-safe-investment, that gain value, when the world is collapsing and invest in serveral very risky ventures that could have a hugh upside (black-swans)
  • I definitly learnt the lession the hard way. My next investment will be more in a barbell-style.
Advertisements

Kommentar verfassen

Trage deine Daten unten ein oder klicke ein Icon um dich einzuloggen:

WordPress.com-Logo

Du kommentierst mit Deinem WordPress.com-Konto. Abmelden /  Ändern )

Google+ Foto

Du kommentierst mit Deinem Google+-Konto. Abmelden /  Ändern )

Twitter-Bild

Du kommentierst mit Deinem Twitter-Konto. Abmelden /  Ändern )

Facebook-Foto

Du kommentierst mit Deinem Facebook-Konto. Abmelden /  Ändern )

w

Verbinde mit %s