Building Resilient Portfolios

Every portfolio is built on assumptions, and every set of assumptions is wrong about something. Resilience isn't a claim that a portfolio will avoid this — it's a design choice about how much damage being wrong is allowed to do.

That reframes the question. Instead of asking whether a position will perform well, the more useful question is what happens to the rest of the portfolio if it doesn't.

Correlation matters more when it's inconvenient

Diversification is easy to claim and harder to verify — the real test isn't how positions behave in an average year, but how they behave together in the specific years that hurt.

A resilient portfolio isn't one with no losing positions. It's one where a single wrong call doesn't force a decision under pressure.