@Duderichy you can invest in levered funds if you understand them and size them appropriately given future expected income. "volatility drag" is a statement about median returns, not mean returns.

@DeepDishEnjoyer Sorry, meant to say they’re not long investments https://x.com/duderichy/status...

@Duderichy like i think *in principle* young adults in high paying fast growing careers can hold levered funds for the first couple of years tbh

@DeepDishEnjoyer @Duderichy [risk of ruin at start of career and survivor bias has entered the chat]

@ben_mathes @Duderichy there is no risk of ruin though, that's the point. your human capital far exceeds your actual monetary capital

@DeepDishEnjoyer @Duderichy Debt and going to zero early on has long term ramifications. Can see this w people who graduated into 2008 as an example.

@ben_mathes @Duderichy Going to zero early does not have long term ramifications. You start off at zero. People who graduated into 2008 is a terrible example because it is precisely the fact that their earnings were tapered that was a problem. The market only went up for them post graduation!

@DeepDishEnjoyer @Duderichy Leverage goes to less than zero tho? (Do leveraged etfs have a floor at zero? If so who takes on the risk of negative?)

@ben_mathes @Duderichy All ETFs and all stocks have a floor of zero! Shareholders have a limited liability by definition. In practice ETF prospectuses have provision for liquidation earlier than literally hitting zero.

@DeepDishEnjoyer @Duderichy TIL. Sounds like it depends on if you have a big drawdown in first few years. So you’re timing the market.

@ben_mathes @Duderichy you're not timing the market and it's becoming pretty abundantly clear that you're way out of depth in this discussion given that you didn't even know stocks can't go negative

@DeepDishEnjoyer @Duderichy Leverage can. but yeah. I’m way out of my depth. Definitely not just rusty on some details. Definitely haven’t worked at a macro hedge fund. 🫡