On The other way, Robert J. Klosterman follow-up to The four horsemen of the apocalypse, the author returns to offer his astute financial and investment advice. The subtitle of the book, “Lighting the way to volatility while achieving equity-like returns, “is fitting, as that is exactly what Klosterman advocates for investors to do to achieve optimal monetary returns from their investment portfolios. Klosterman gets his title from Robert Frost’s famous poem”,The road not taken, “which he quotes at the beginning of The Other Path, a very interesting book that provides investors with information on a different type of investment approach than they might be used to, albeit a very effective one that is designed to help investors get stocks. types of returns while reducing volatility experienced by many other investors who only try more traditional approaches when it comes to planning their portfolios.
Klosterman’s book, The other way, is relatively short, at only 60 pages, not counting the Appendices at the end, but his approach to investing, which he details in it, is very informative. The book is sure to interest and be of benefit to anyone who wishes to reduce their investment risks while maximizing their potential monetary returns.
The very title of Klosterman’s book, The other way, refers to an investment strategy, or path, that most people have traditionally followed, which consists of investing all their money in stocks, bonds, and cash. This approach is tried and true and has proven beneficial for many investors, but has also proven to be a sometimes volatile path for others. Investing in stocks, bonds and cash, Klosterman argues, is an important part of an overall investment strategy, although there are other opportunities to diversify investments and reduce the volatility that many portfolios unfortunately experience – volatility that can cause the dollar value of the portfolio. wallet of one. to experience a disastrous nosedive.
Still, the main leg of the milk stool – that is, investing in stocks, bonds, and cash – is a vital component in a smart investment strategy, according to Klosterman’s assessment in The other way. He calls it the center leg of a three-legged metaphorical milk stool, and each leg in the metaphor refers to a different but complementary strategy when it comes to investing. If an investor diversifies his portfolio and does not focus solely on the mainstream of stocks, bonds, and cash, but also invests his money in non-traditional ways, Klosterman argues, using a series of helpful and informative charts and graphs, than the portfolio One’s is much less likely to experience a disastrous financial loss and volatility in one’s portfolio will be reduced.
The second of the three legs of the milk stool is “Diversifiers” and the third leg is “Absolute Returns”. Klosterman argues that “diversifiers,” or alternative or non-traditional investments, help reduce the volatility of an overall investment portfolio. Some examples the author gives of non-traditional investments include real estate, private equity, “international developed and emerging securities,” distressed debt, and managed futures. These types of non-traditional investments can reduce volatility by having “very low correlation with traditional markets,” as Klosterman writes, or by generating “consistent returns year-over-year, with little or no volatility.”
The third leg of the milk stool, “Absolute Returns”, is also the name of Chapter Four of The Other Way. The absolute returns are investments, according to Klosterman, that “demonstrate the same qualities of a bond with the guarantee of return of the principle and constant payment of interests”. The author writes that they are similar to ten-year treasury bonds, but “are not backed by the full faith and credit of the United States.” Despite this, Klosterman claims that the look of absolute return vehicles can be seen as an advantage. This is because strategies that involve vehicles of absolute return, as the author writes, “can invest in solid ideas and do not have to adjust to the restrictions that other institutions have.”
An example is investing in companies that lend money to small businesses and people who build homes. These companies can work fast and close loans faster than banks. These companies have the ability to provide quick access to cash loans to people like real estate developers or home seekers, compared to banks.
On The other way, author Robert J. Klosterman writes about a sensible approach to non-traditional investing and how it can benefit one’s investment portfolio and help reduce volatility. The book also examines and identifies “trouble signs” in addition to volatility when planning one’s portfolio, such as groupthink, market disruptions, and inflation. While Klosterman recommends that investors follow the advice of professionals who are experts in investment portfolio planning and have a proven track record for at least a decade, The Other Path is an interesting and insightful look at adding non-traditional investments to your portfolio. An individual. Whether investors want and like to plan their investment strategies on their own or with the advice of professionals, The other way is an eye-opening must-read designed to educate investors on the types of alternative investments that can balance their portfolios and reduce the negative effects of market volatility. It is a book that I would highly recommend to anyone who has ever considered expanding their investment portfolios and adding non-traditional investments to them.