BARBELL PARADOXES

With strategy, two phenomena worth considering are:

1. Barbells

Whether in life, business or an investment portfolio, capital is said to be ‘barbelled’ if 90% of your money is safe and the remaining 10% is allocated to risky investments. 

Young people ask me about their crypto investments. They share that crypto is not safe - crypto is risky. I share I am not a financial advisor. However, they might consider a barbell approach - limit initial crypto investment to 10% of their net worth and when the coin goes up 10x, then sell 90% for a profit and leave 10% in the coin. Once the coin goes up 10x, repeat. 

I have a pharmacy client who sells cannabis oil for a tidy profit - many patients use it repeatedly to treat insomnia, depression, anxiety and inflammation. Yesterday my client shared one of the riskiest areas of prescription medicine coming over the hill could be psychedelics to treat trauma and depression. My client imagined a barbell approach with 10% of capital being allocated into this new area of pharmacology.

Imagine if all developed countries sent 10% of vaccines manufactured to South Africa and delayed boosters. The safe (and selfish) choice is to combat waning immunity with boosters. A barbell approach could be to save Africans first. 


2. Paradoxes 

The truth is always paradoxical. Facebook connected people but made many of them withdrawn depressed social media addicts. Priests preached celibacy but presided over the most sexual abuse in human history. Omicron may eradicate Delta and, at the same time, be relatively benign :-)

What does your barbell strategy look like?

If something is true, find the paradoxical contained within it.