Barbell

Barbell — an allocation shape with the two extremes loaded and the middle deliberately empty: concentrated, effort-driven business equity on one side; cheap, liquid, diversified index on the other. The middle (stock picking, sector funds, structured products) is skipped because it carries equity-like risk without either the control of the business or the reliability of the index. The honest allocation shape for anyone whose dominant asset is a business they operate.

First used in: 5.3 · The S&P leverage point and the barbell