Show Notes
When is good enough actually good enough? AI is reshaping how I work and live. And a member with a portfolio that's beaten an all-in-one Vanguard LifeStrategy fund for ten years asks whether the complexity is worth it — or whether it's time to simplify. Sponsors Masterworks - Invest in multimillion-dollar artwork offerings Delete Me – Use code David20 to get 20% off Insiders Guide Email Newsletter Get our free Investors' Checklist when you sign up for the free Money for the Rest of Us email newsletter Our Premium Products Asset Camp Money for the Rest of Us Plus Show Notes The Upswing: How We Came Together a Century Ago and How We Can Do It Again by Robert Putnam—Simon &Schuster An update on our model deprecation commitments for Claude Opus 3—Anthropic Claude's Corner—Substack Investments Mentioned Vanguard LifeStrategy Growth Fund Investor (VASGX) Related Episodes 542: Don’t Take Financial Advice from AI 491: The Five Layers of Investing 419: How to Make Portfolio and Asset Allocation Changes
Masterworks Disclosures Listeners get priority access to Masterworks at https://www.Masterworks.com/david Art correlation and appreciation data based on repeat-sales index of historical Post-War & Contemporary Art market prices and S&P 500 annualized return (includes dividends reinvested) from 1995 to 2025, developed by Masterworks. There are significant limitations to comparative asset class data. Indices are unmanaged and a Masterworks investor cannot invest directly in an index. Content creator (the “Endorser”) receives cash compensation from Masterworks, LLC (“Masterworks”). Endorser is a client of Masterworks. Masterworks can only make and accept sales after an offering statement has been filed, and “qualified”, by the SEC. Any offers may be revoked before notice of qualification. Indications of interest involve no obligation. Investing involves risk. Past performance not indicative of future returns. For further disclosure on Regulation A Offerings, Risks of Investing, Performance Metrics, Art Market Data, and more visit the offering documents filed with the SEC and Important Disclosures at masterworks.com/cd. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.
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In this episode, we explore why the income we earn isn't the same as the return. We show how option income strategies work, what their historical returns have been, what drives the return, and what reasonable return expectations are. We show why option income strategies have a positive expected return while sports betting has a negative expected return. Finally, we look at other areas where we confuse income with the total return. Sponsors Money for the Rest of Us Retirement Investing Cohort Delete Me – Use code David20 to get 20% off Our Premium Products Asset Camp Money for the Rest of Us Plus Show Notes Episode slide deck Variance Risk Premia by Peter Carr and Liuren Wu—NYU Cross section of option returns and idiosyncratic stock volatility by Jie Cao and Bing Han—The Journal of Financial Economics The Price of Correlation Risk: Evidence from Equity Options by Joost Driessen, Pascal J. Maenhout, Grigory Vilkov—SSRN Cross-section of option returns and volatility by Amit Goyal and Alessio Saretto—The Journal of Financial Economics The Art of Put Selling: A 10 Year Study by John Marshall, Krag Gregory, Katherine Fogertey—Goldman Sachs Low Stress Bets Related Episodes 557: Don’t Fall in the Dividend Trap 549: Why Catastrophe Bonds Are Yielding 12%, and Should You Invest? 544: Sports Betting Is Not Investing Article: Tail Events and Tail Risk See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.
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