so in today's video we're going to be diving into why D5 millionaires only use three types of positions in their portfolio and no I do not mean just three positions total in their portfolio I mean three types of positions in their portfolio and we are going to be going over a bonus one that people actually include in their portfolio as well this is the same strategic framework that I teach to people that have $10,000 in their portfolio $50,000 in their portfolio all the way up to a million 2 million 3 million and so on and so forth in their portfolio the fundamentals stay the same nothing changes there anyways I want to go ahead and dive right into today's video the three types of positions that we have today are going to be crypto to crypto positions crypto to stable positions and stable to stable positions now as mentioned we are going to get to a bonus one later on in today's video so make sure to stay tuned and of course if you guys are finding this information valuable make sure to drop a like And subscribe and turn on notifications so you don't miss out on my next few videos these are the same positions I'm using within my portfolio to generate a 108% APR which is coming out to roughly $130 per day this is just half of the amount of capital that I currently have in Defi and that's because I also have other Investments dispersed across the salana network and of course just other networks that aren't tracked on Metric Finance it's the same framework that AAS one of our defi Mastery members is using to generate a 465 APR generate over $700 per day from his portfolio off of roughly $56,000 and one of our other members quali is using to generate a 70% AP on their lowest performing position and up to a 692 per APR on their highest performing position now there's no perfect or no set structure for allocations into these different categories right here because these if you're in defi are relatively self-explanatory you pair a cryptocurrency with a cryptocurrency you pair a cryptocurrency with a stable coin and you pair a stable coin with a stable coin basically we're going to talk about the goals behind each of these positions what they can do what they can't do uh when you should use each of them and of course potential allocations depending on your overall portfolio's goal so the first thing that I want to go ahead and mention crypto crypto positions the majority of these are going to be growth positions And what I mean by that is they are going to be focused on asset appreciation if the market goes up 10% let's just say we are aiming to capture as much of that 10% as possible while still earning some fees earning some income so our priority with these crypto to crypto positions are to earn some fees but prioritize growth and what we're thinking when we're investing into these crypto crypto positions is we're saying hey maybe we're in something like BTC to ethereum right and this is doing let's just say a 50% APR so something that's still relatively good but it's not great it's not 100% it's not 150% right we're saying hey if BTC and eth go up let's just say 2x we want to witness that 2x return basically and then the cherry on top is this 50% APR that we're generating in the meantime and of course that we can use to compound back in the position or compound into other positions and the reason why is because if we're in BTC to eth compared to something like BTC with USD or eth with USD that's maybe generating a 100% APR ultimately this 2x plus 50% APR is going to outweigh what we would generate with BTC to USD at a 100% APR the difference is BTC to USD at a 100% APR is going to generate us more short-term income there's going to be less speculation on future price movements and more guaranteed income coming in however if we're in the instance where we are very very confident that we know that Bitcoin and ethereum are going to continue to grow then this right here would be the better circumstance because this is a growth position the growth is what gives us the best returns now with crypto to crypto positions we are looking for correlated pairs assets that are essentially moving together and that's when we're focusing on growth basically because ultimately what's going to happen is if both assets go up let's just say 10% there will be no Divergence loss in the position no impermanent loss right nothing basically we will see a 10% gain that's assuming both go up 10% now if one goes up 10% and the other only goes up let's just say 5% there's some Divergence loss right there our hope is that obviously the fees are going to outweigh that Divergence right there but the point is these pairs are correlated meaning there's going to be way less Divergence loss and if we were to dive into something like crypto to stable liquidity pools where we are focusing on income and the reason why is because well number one crypto to stable liquidity pools do not have full Market exposure off the bat let's just say we start with even 60% ethereum and 40% stablecoin basically let's just say usdc in this instance well if ethereum were to go up 10% we are not going to witness that full 10% matter of fact we're not even going to witness 6% because ultimately as the price of ethereum is going up some of that ethereum is being shifted over into the stable coin because people are buying our ethereum in liquidity pool therefore meaning that we're slowly losing exposure to ethereum this does not make the most sense to be running in Bull markets because ultimately we are losing exposure to cryptocurrency Assets Now in the instance where we're trying to sell out of specific assets like we want a dollar cost average out because we're expecting the market to kind of come to a halt pretty soon then that's where we would use crypto to stable equity pools in a bull market to sell out of specific Assets Now these are typically going to have high fees compared to the crypto to crypto liquidity pools when you looking at the same risk categor so what I mean by that is if we're looking at say BTC to eth over here right as I mentioned earlier this might generate a 50% APR whereas something like BTC to usdc or something like that might generate a 100% APR basically now if we're looking at ethereum to usdc it doesn't make sense to Benchmark ethereum to usdc to ethereum to something like Aether because obviously Aether is a much much higher risk asset you're taking on more risk right here going outside of that risk category anyways correlation does not matter in these crypto stable quity pools and the reason why is because we're going to get sold out of one asset this stable coin is not going up 1% it's not going down 1% It is staying at its current price at least we hope right whereas this other crypto asset is going up it's going down right it's volatile ultimately that means we're going to be sold into the stable coin and sold out of the stable coin it's going to create more Divergence loss which means that we are not really focused on long-term appreciation here but rather focused on kind of mitigating our Market risk to an extent and of course earning High fees with a lower risk tolerance and then of course stable to stable obviously the goal right here is going to be income as well but it's also going to be to have no Market exposure basically we don't want to witness those 10% 15% gains in the market we also don't want to witness those 10 to 15% losses in the market the goal here is to generate a consistent income basically typically with stable to stable Accord of the pools depending on how much risk you're taking you could do about 30% APR obviously if you're heavily allocated to the higher risk positions you're going to be doing more like 40 50% whereas if you're heavily allocated to kind of the more Blue Chip stable coins it's going to be more like 30% even down to 20% sometimes so these are the three types of positions that D5 millionaires include in their portfolio now as far as allocations go right you have to determine what you want to focus on in your portfolio do you want to focus on mitigating your risk even if that comes at the cost of your upside also being mitigated well then you're probably going to want to allocate 80% to crypto stable liquidity pools that's going to produce High income right and then you're going to want to have another 20% allocated to stable stable liquidity pools if you just want to focus on earning the highest income possible perhaps you are focusing on these crypto to stable equility pools with 80% once again but then another 20% in crypto to crypto pools that have higher risk right not in the same risk category the ones that are in higher risk category but you have a small amount of exposure overall to these ones ultimately mitigating your overall portfolio risk or if you want to have the most growth potential possible you're probably allocating 80% or more to crypto to crypto liquidity pools that are correlated big emphasis on correlated because not all crypto crypto liquidity pools are growth focused if they aren't correlated basically But ultimately the other 20% could be allocated over here to crypto stable and perhaps you have a flywheel where you're taking the income from the crypto stable putting it right over here in crypto crypto and you're taking the income from the crypto to crypto and you're putting it right back in to crypto to crypto liquidity pools there are so many different strategies that you can put in the mix here but ultimately you want to determine your focus in the portfolio are you focused on growth are you focused on income or are you focused on mitigating your risk and ultimately this is what I like to look at when it comes to growth this is what I like to look at when it comes to income and this is what I like to look at when it comes to mitigating My overall risk now Guys these are Frameworks pulled straight from our defi Legacy program there's going to be more information about that right below this video if you guys do want to check that out but I do want to go ahead and mention that one bonus position that def5 millionaires also include in their portfolio and that is pretty simple it is called huddles basically you need to forgo the mindset of putting all your money into liquidity pools while it does make sense have everything cash flowing have everything earning you income you have to realize that there is an inherent risk when putting everything into liquidity pools number one you have the smart contract risk which isn't that much of a risk if you're using Blue Chip platforms and stuff that has been around for a long time has billions of dollars in it has undergone audits stuff like that basically but the other risk that you're taking on is that Divergence loss risk the fact that one asset can do better than the other and you are going to gain exposure to the lower performing asset even in these crypto to crypto liquidity pools that are focused on growth there are going to be instances where one asset goes up 20% and the other one may only go up like 5% ultimately you'd have a lot of Divergence here so by having exposure to both hotle as well as income generating positions which are these liquidity pools right over here you're able to essentially have maximum portfolio growth and then within your income portfolio you can decide how much growth you want to have versus how much income you want to create or how much Market exposure you want to have as well this is the strategy that I have implemented into my portfolio right now that I'm using to cash flow on a daily basis that our members are using to cash flow on a daily basis and that defi millionaires are also using to cash flow on a daily basis guys if this makes sense to you if you enjoyed this type of explanation make sure to drop a like on this video and let me know Down Below in the comments what video you guys want to see on the channel next because I'm happy to create it for you guys and drop a ton of value I hope you enjoyed and I will see you guys in the next video peace out