Evan CarmichaelSpeaker / Author / Introvert

Discover the Secret to Investing: Diversification Saves You from Disaster

29 May 2016 · 1 min

Watch on YouTube

1:03

In this YouTube video, Evan Carmichael moderates a conversation about the role of diversification in investing. Speaker A defines diversification as spreading investments across many businesses and sectors to protect against disaster, emphasizing that it allows an investor to end each day richer despite some assets underperforming. Speaker B shares a personal story of concentrating all his money in MLPs, MREITs, and Australian bonds during 2008‑2009, believing those were the best opportunities, and later dismisses traditional diversification as ineffective. Speaker C challenges B’s one‑way bets, pointing out they are not true portfolio balancing. Evan wraps up by urging viewers to understand and integrate opposing viewpoints, suggesting that learning from both sides can accelerate personal success. The video’s purpose is to highlight diversification as a risk‑management tool while also questioning its limits and encouraging a nuanced, integrative perspective.

Chapters

¿Qué es diversificación? What I've learned that works if you're an investor, no matter how much money you've got, whether it's $5,000 or $500 million, diversification is what saves you from disaster. Having investments in a wide range of businesses and sectors. There's always something working when something else isn't. So Today I can go to bed tonight knowing that I have one objective. I want to go to bed richer than I woke up, and the only way that's going to happen to me is to be invested in a lot of different things. Because every day one thing works while three others don't, but sometimes that's why you get richer.
In 2008 and 2009, I put everything into MLPs and MREITs, the mortgage-backed securities, ones that I thought were the better companies, and I just piled in. And I also piled into Australian bonds because I thought the economy was good next to China. It was my way of playing China.
So you make one-way bets. This isn't portfolio balancing you're talking about.
No, all that asset management, you know, diversification, that's for idiots, right? Because you can't diversify enough to know what you're doing.
Thank you guys so much for watching. I made this series because I wanted to promote understanding and awareness. I wanted you to see that it's not always looking at it as one thing or the other, but if you embrace the genius of the and and bring those two seemingly opposite points of view together, that that is where the true genius lies. I want you to see that you can learn from both of the people that I profiled in the video, especially probably from the person who you don't immediately agree with. If you can understand their perspective and apply it to your life, chances are it'll help you get to where you wanna go a lot faster. So let me know what you think. Leave a comment below. I'll join the discussion. Continue to believe. And I'll see you soon.