Most dividend investors pick ETFs by yield and intuition. The Risk Spectrum Constructor replaces that with a five-tier classification system — each tier defined by risk profile, income characteristics, and position sizing rules — plus five model portfolios from conservative to aggressive income.
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The 15% Tier 5 maximum isn't an arbitrary rule — it's derived from income volatility data. Portfolios exceeding it showed 2.3x higher income volatility with only 1.1x income increase.
Investors who chose holdings by yield and conviction consistently underperformed systematic tier-weight allocations in backtests. The framework beats the gut call.
The Rebalancing Rules and Monitoring system in Chapter 8 is what makes a portfolio durable over years. Without it, you're flying without instruments.
A purely conservative Tier 1–2 portfolio may fall short of your income target. A calibrated Tier 3 addition adds 1.8% yield with minimal NAV risk at the right allocation weight.
Chapters marked Most Relevant are specifically applicable to your situation.
Why systematic tier-based construction outperforms intuition-based picking.
SGOV, BIL, T-bills — the foundation every income portfolio needs.
Conservative (Tier 1-2), Balanced (Tier 1-3), Income (Tier 2-4), Aggressive (Tier 2-5), FIRE Bridge (Tier 3-4).
When to rebalance, what triggers a tier reassignment, quarterly review cadence.
6.8% yield, 0.3% NAV change
The Tier 1–3 Conservative Model Portfolio averaged 6.8% yield with 0.3% annual NAV change over 3 years — income without the principal erosion that comes with undisciplined tier mixing.
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Institutional-grade analysis. If it doesn't change how you evaluate dividend investments, we'll make it right.
Used by 5,000+ dividend investors constructing income portfolios across all 5 tiers
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