Markets don't move in straight lines, and neither should your portfolio. In this episode, we dig into liquid alternatives as a practical way to add non-correlated return drivers alongside stocks, real estate, Bitcoin, and precious metals—especially when bonds may not deliver the cushion investors expect.
We break down what liquid alts actually are: managed futures, trend systems, mean reversion, rate trades, currencies, and metals. Non-correlation isn't negative correlation—during stress, everything can dip together before dispersion returns. That's why expectations, risk controls, and discipline matter.
We cover fees and taxes and why high fees can be worth it if the alpha is distinct. We also explore portable alpha and capital efficiency: holding your market exposure while allocating to a separate sleeve that aims to beat financing costs without hidden equity beta.
Position sizing and volatility scaling are non-negotiable—"volatility is leverage" means you must adapt as markets move. Finally, the behavioral side: rebalancing into what feels bad to buy and trimming what feels great to hold. That discipline turns flexibility into outcomes when policy whipsaws traditional 60/40 thinking.
KEY TOPICS:
What liquid alts are and why liquidity matters
Managed futures, trend, and mean reversion
Non-correlation vs negative correlation
Fees, taxes, and when costs are justified
Portable alpha and capital efficiency
Position sizing and volatility scaling
Rebalancing discipline
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https://ducharmewealth.com
DISCLAIMER:
Information presented on this program is believed to be factual and up-to-date, but we do not guarantee its accuracy, and it should not be regarded as a complete analysis of the subjects discussed. Discussions and answers to questions do not involve the rendering of personalized investment advice, but are limited to the dissemination of general information. A professional advisor should be consulted before implementing any of the options presented. Encompass More Asset Management LLC is a registered investment adviser with the U.S. Securities and Exchange Commission (SEC) and only transacts business in states where it is properly registered, or is excluded or exempted from registration requirements.
[00:00:00] Defining Liquid Alternatives
[00:04:57] Liquidity As A Rebalancing Tool
[00:08:21] What Counts As A Liquid Alt
[00:14:23] Managed Futures: Use Cases And Pain
[00:22:35] Accessibility, Fees, And Manager Selection
[00:27:06] Using Alts For Portable Alpha
[00:31:20] Risks, Drawdowns, And Behavior
[00:39:15] Avoiding Hidden Beta And Overlap
[00:44:25] Daily Oversight And Active Management
[00:49:25] Preparing For Next Topic And Closing
