You just retired and will live off your savings and investments. You have 2 portfolios to choose from: Portfolio A should have 8% vol and 6% geometric return Portfolio B should have 12% vol an 6.5% geometric return Which should lead to more wealth to pass to future generations?
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Its twitter and I wanted it on one tweet. Under reasonable starting assumptions, I'm pretty sure after 30 years you are not correct about the relative terminal wealths.
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It’s easy to check if you are happy to assume lognormal returns (I messed up a bit, 30 years is not quite right, but after 25 years the lower returning portfolio has higher 25th percentile)pic.twitter.com/PSzg774SHV
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finance twitter evolving to do the equivalent of normie viral twitter math problems with intentionally unclear order of operations at play. Impressive.pic.twitter.com/9Or6yJ4FqW
Thanks. Twitter will use this to make your timeline better. UndoUndo
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