Lesson 1 of 3Wealth Preservation·Intermediate
Compounding vs. preservation
Two different portfolio jobs. Most investors need both.
6 min read
The wealth-building portfolio and the wealth-preservation portfolio are different animals with different scoring rules.
The building phase
In the accumulation years, volatility is your friend. Down markets let you buy more shares. Compounding is the whole game.
The preservation phase
Later, priorities invert. Sequence-of-returns risk becomes the enemy. A large drawdown early in retirement can permanently impair the portfolio.
Where gold fits
Gold is a preservation asset. It reduces drawdowns during equity stress. It is not a substitute for stocks — it is a stabilizer.
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