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Hi AJ,

So quit trying to sell an IUL as a way that everyone will end up with more money - because 90%+ won't.

Talk about 'FUD'... do you have *any* link to support that, or are you conjuring the 90% figure from your 'reserves' region?

As I have said endlessly now;
SOME people will DEFINITELY win the gamble with a diversified split of cash & securities.
SOME people will definitely LOSE EVERYTHING.

Those who aren't of the gambling ideology look for the best returns without the higher risks.

OH, by the way... you (and others) keep getting hung up on the hedged/floored strategy being "too safe"... that you are forced into paying for far more protection than you actually "need" (or more honestly, "want.")

What you are ignoring is that the hedged/floor strategy can be "risked up" as well. Doing so increases the gains as the defined risks are increased.

Assume an IUL has a cash-value guarantee of no less than 90% of it's deposits in an early year (and a comparative naked position would have to hold 80% cash, if investing in a 50% risk environment.)

Let's assume the naked investor actually WANTS to risk 30% total portfolio loss... not be restricted to only 10%... and that let's them put 60% of their total assets at risk, and keep only 40% in cash (since a loss of half the 60% at risk would then leave them with 30% securities and 40% cash... 70% of total portfolio value remaining.)

The IUL can pull out 20% of it's cash value on day 1 as a policy loan, and buy an option spread that grows when the market climbs on a leveraged basis (anywhere from 1:1, to 100:1 or higher,) giving the hedged/floored strategy a far better than 1:1 market return on the full 100% cash value ('total portfolio value'.)

The naked position would still only gain 60% of the actual market gains that year, because 40% of it's horsepower was kept in cash-like 'e-funds' losing to inflation.

Again... the math plays it out.
If you want to put real numbers on paper, I am willing to match.
I offered to JAFO, and he's been silent.
I've offered to RAY, and he complains that I'm being to strict in the numbers.

Do you want to put up factual numbers for comparisons, with real math?

Dave Donhoff
Leverage Planner
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