> There are few good passive investments right now. There's so much capital available in search of returns that all the good ones and most of the mediocre ones have been taken.
This is one of the more insightful comments in this thread. The risk is not merely that Sam’s investments are not diversified, it’s that Sam has competition from more sophisticated capital. Truly passive investments often scale (and get more passive with scale). That scale attracts a lot of capital that can afford lower revenue, higher risk, and better expert knowledge.
Instead of competing with big companies, you might as well just buy stock in them. They've already mastered how to run those businesses with very low overhead!
This is one of the more insightful comments in this thread. The risk is not merely that Sam’s investments are not diversified, it’s that Sam has competition from more sophisticated capital. Truly passive investments often scale (and get more passive with scale). That scale attracts a lot of capital that can afford lower revenue, higher risk, and better expert knowledge.