I just completed Radical Uncertainty by John Kay and Mervin King and I would just like to touch on a concept explained in the last few chapters which had a significant impact on me.

Since almost the beginning of conducting the Early Retirement Masterclass, the one bugbear that myself and my entire community is trying to fight against is non-stationarity. And I admit that it's a losing battle most of the time.

Non-stationarity is that property of financial markets that say that measures of volatility are itself unstable across time and the models we build to simulate the markets have largely an unknown shelf life. This keeps myself and my community humble because we will never know when our models break down.

For example, when we were leveraged in the REITs markets, we knew that it was a very smart decision at that time since returns exceeded 12% and the standard deviation was only