I stopped writing part of my notes section for a while because there was some stuff that I should get through before writing about my income portfolio implementation. One of them is a post about my mental model and how I look at returns. Why is that important? If you don’t understand that well, you will have a lot of questions. So, I decided to write this post. This post is about 4,500 words, but if you don’t want to read so much, the short version is that my view is returns are driven by different forms of systematic risk and systematic errors made by various groups of people. I am not sure what kind of returns I will get in the future, but with historical returns data, I can get a good sense of whether the risks that I take will be well compensated. So I own a portfolio make up of risky stuff like such an illustration:...