KMLM - RSBT: Why I'm About To Start Buying This 7.4% Yielding ETF

2024-05-30 07:00:00 ET

Summary

• Nvidia's recent 20% post-earnings rally is an excellent example of how the market gods can be kind...but also fickle. Corrections always follow good times.
• To reach your financial goals, you must embrace asset allocation, which historically determines 87% of long-term returns, not market timing.
• The right hedging assets can be the difference between sleeping well at night in bear markets and making emotional, catastrophic mistakes.
• RSBT is an ETF that combines bonds with managed futures, a strategy that has been highly effective in nearly every bear market since 2000.
• Combined with KMLM, this combo of bonds and managed futures creates the best hedging asset I've ever discovered, averaging 34% gains in bear markets since 2000. This combo could deliver 7% to 8% long-term returns (paid out as yield), two times that of the expected return of bonds, which is why I'll soon start building a position in RSBT.

It's always exciting to watch stocks like Nvidia ( NVDA )(NVDA:CA) soar to new heights after delivering another stellar earnings report.

Post earnings, NVDA's earnings estimates have increased by 5% for 2024 and 10% for 2025, and its long-term growth outlook is now soaring to an impressive 38%.

While it's exciting to see your portfolio hitting record highs, it's crucial to prioritize risk management first.

Remember, good times are always followed by a correction or even a bear market. It's not about what you make, but what you keep long-term that genuinely matters.

Bad Risk Management Leads Can Lead To Terrible Investment Outcomes

Ben Carlson is an RIA for Rithotlz Wealth Management and once shared on his podcast the story of a client that exemplifies the dangers of market timing.

In January 2008, he watched a presentation on YouTube that convinced him that a credit crisis would tank the economy and the stock market. The doomsday prophet said the S&P was going to 500, a 69% crash....

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