Many articles lately about protecting your portfolio against “tail risk.”

Tail risk, unfortunately, is not one thing.

Death can be caused by many illnesses. To protect yourself against death successfully for an extended period you may need vaccination against many viruses and a variety of antibiotics against germs. Worse, some of the treatments may be hazardous to your health; many diseases are in fact iatrogenic, caused by the doctors and medicines intended to cure the patient. There is no panacea.

Analogously, the value of a portfolio can be substantially destroyed by more than one cause. Portfolios can be ruined by equity crashes, credit spread widenings, bond defaults, high interest rates, sustained inflation, increases in volatility, illiquidity, etc. To protect your portfolio against so-called tail risk may require spending money on insurance against all these risks, and there is no panacea here either.