# The Barbell Strategy ## The Idea in Brief Combine extreme safety with small, high-risk/high-reward bets. Avoid the middle. The "barbell" has weight on both ends: most of your resources go to ultra-safe positions, while a small portion goes to maximally risky ones. Nothing goes to the mediocre middle where you get neither safety nor upside. --- ## Key Concepts ### Why Avoid the Middle Medium-risk positions are fragile. They're not safe enough to survive severe stress, and they don't have enough upside to compensate for the risk taken. A "balanced" portfolio of medium-risk assets can lose everything in a crisis. The barbell survives because one end is invulnerable. ### Asymmetric Payoffs The risky end of the barbell is chosen for asymmetry: limited downside (you only risk what you allocated), unlimited upside. You can afford to be wrong many times because one success more than compensates. This is [[Optionality]] expressed as portfolio construction. ### The 90/10 Rule Taleb's heuristic: 90% in the safest possible assets (treasury bills, cash), 10% in the riskiest possible bets (venture investments, out-of-the-money options). The 90% ensures survival. The 10% provides all the upside. You can't lose more than 10%, but you can gain multiples. ### Antifragility Through Structure The barbell isn't just robust—it's antifragile. Volatility helps it. When markets crash, your safe assets protect you while you pick up cheap options. When markets boom, your risky bets pay off. The middle would suffer in both scenarios. --- ## Implications **In investing:** Don't hold "moderate risk" assets. Hold truly safe assets (short-term government bonds, cash) and truly risky ones (individual stocks, venture bets, options). Skip bond funds, balanced portfolios, and "conservative" equities. **In career:** Have a stable income source (safe end) and side projects with asymmetric upside (risky end). Don't optimise for a "good job" that's neither secure nor transformative. **In time allocation:** Spend most time on reliable, productive activities. Spend some time on wild experiments. Don't spend time on activities that are moderately interesting and moderately productive. **In knowledge:** Master the fundamentals deeply (safe end). Explore fringe ideas occasionally (risky end). Don't accumulate "medium expertise" in many areas—it's fragile. --- ## Sources - [[Antifragile]] — Taleb's core framework; the barbell as the structure of antifragility - [[The Most Important Thing]] — Howard Marks on asymmetric positioning; margin of safety as the safe end of the barbell - [[Skin in the Game]] — Survival is asymmetric; the barbell protects against ruin while allowing participation in gains