Comments on: Is Rich Dad the Great Black Swan Hunter?

By: Dan at Everydayfinance

Dan at Everydayfinance — Fri, 12 Oct 2007 02:41:56 +0000

I read an item with him in Businessweek where he advocated keeping 95% of your holdings in TIPS (Gee, thanks for the 2% return matching inflation!) and the other 5% in way out of the money index call options; the thought being that in down markets, you’ll break even, but in up markets, you’ll make a killing when your out of the money calls come into the money, assuming the return outpaced the premium priced in when you purchased and they didn’t expire yet.

I haven’t modeled this historically yet (as you could practically back into a good model to prove the theory, so I’d have to do it randomly), as I’ve modeled other quantitative plays, but it is interesting, have to give him that.

I’m glad I didn’t entertain it this year though, killing in internationals and tech.

By: DR

DR — Mon, 01 Oct 2007 00:34:25 +0000

Shadox, I agree with you. I actually found some value in Rich Dad, Poor Dad, but it’s been downhill ever since.

By: shadox

shadox — Sun, 30 Sep 2007 23:58:23 +0000

With all due respect to Mr. Kyosaki, that guy is a fraud. I only read Rich Dad, Poor Dad but I was so underwhelmed by its mediocraty that I made up my mind up him right then and there. I thought his advice was simply horrible. In his book he actually goes as far as to advise people not to diversify. Seriously.

By: PFJournal

PFJournal — Sun, 30 Sep 2007 00:44:23 +0000

I was really impressed with Taleb from Fooled by Randomness and look forward to this new one. I agree, Koyasaki and his ilk would do well to pay more respect to uncertainty.

By: plonkee

plonkee — Fri, 28 Sep 2007 20:42:56 +0000

Black swans. Yes.

Kiyosaki. No.

Nuff said.