What War Taught Me About Managing Wealth
- Casey Silveria
- Feb 4
- 6 min read
Most portfolios don't have rules. They have allocations, projections, and assumptions. But when markets drop 20% and you need to take a distribution, there's no system telling you what to do. No rule for which account to pull from.
No structure preventing you from panic-selling at the bottom.
Every decision gets made under pressure, in the moment, when emotions are running highest.
That's backward. And I learned exactly why during a war.
When My Models Got Stress-Tested for Real
February 2022. I was sitting in an office in the Netherlands, watching markets do things I'd never seen before.
Russia had just invaded Ukraine. Energy prices in Europe were spiking. Markets were in chaos. And the company's strategy for navigating it ran on models I had built.
I worked in finance for an international food company. My job was to build and stress-test the models that determined how we protected against market swings. When prices moved, my models told us what to do. When supply chains fractured, my stress tests had already mapped the scenarios.
But here's what I remember most from that time: it wasn't the spreadsheets.
I worked alongside a Ukrainian woman whose family was stuck in the war zone. They couldn't find their way out. Every day she came to work, and every day the news got worse. I still think about her tear-filled eyes.
On one screen, my models calculated exposure. Across the desk sat someone whose entire world was unraveling in real time.
The headlines were relentless. Sanctions, supply disruptions, currency swings. I could have overridden the decision frameworks based on emotions. I could have second-guessed every assumption I'd built into the system.
I didn't. I trusted the rules I'd already set.
Not because I didn't care about what was happening. Because caring deeply and acting emotionally are two different things.
Why Rules-Based Systems Beat Intuition
In his book What Works on Wall Street, quantitative investor Jim O'Shaughnessy cites decades of research comparing humans and mathematical models. The research suggests that mathematical models historically outperformed human forecasters in specific studied scenarios. Past performance of any model or strategy is never a guarantee of future results.
Even when humans had access to the same models beforehand, they still lost. Why? O'Shaughnessy's explanation captures it:
Models are always consistent. They never vary.
They are never moody, never fight with their spouse, never hung over from a night on the town, and never get bored.
They don't favor interesting stories over data.
They never take anything personally.
They don't have egos.
I'd lived this. Back in that office in the Netherlands, executives I supported were tempted to override the models based on the latest headline. The situation was unprecedented. Surely this time called for human judgment?
It didn't.
The emotional weight of what was happening made it harder, not easier, to think clearly. When your colleague is crying at her desk because she can't reach her mother in Kyiv, your brain floods with stress hormones. That's not the moment to override a model based on gut instinct. That's the moment you're grateful the rules were already set.
Building a Portfolio That Doesn't Require Prediction
When I established Silveria Wealth Group, I carried this lesson with me: the goal isn't to predict the unpredictable. It's to build a system that doesn't require prediction.
That's why I built the R&R Investing framework around Roles and Rules.
Roles means every dollar gets assigned to one of five jobs based on what it's supposed to do for you. Not just "stocks" and "bonds" as asset classes, but functional objectives that align with how your brain organizes money.
Rules means each role operates with clear guidelines set in advance, tailored to each client's behavioral patterns. When to rebalance. When to harvest losses. When to hold steady. The rules make decisions for you when headlines are screaming and your judgment is compromised.
The Five Roles (And the Bias Each One Solves)
Reserves hold 12-24 months of living expenses in ultra-safe, liquid assets. This isn't just an emergency fund. It's the psychological floor that lets you ignore market volatility in your long-term holdings. When you know your near-term needs are untouchable, your brain can relax. Reserves address loss aversion, the tendency to feel losses about twice as intensely as equivalent gains.
Income generates predictable cash flow you have permission to spend. Bond ladders, dividend-focused positions, systematic distributions structured to give you "income" your brain can comfortably use while keeping "principal" intact. Income addresses mental accounting, the way we mentally separate money into categories and treat gains differently than principal.
Growth is money designated for 10+ years out. Because Reserves and Income handle near-term needs, Growth can truly be long-term capital. No mental pressure to access it during corrections. Growth addresses present bias, the tendency to overweight near-term needs and discount future ones. We utilize a proprietary factor-based approach, targeting relative value and price-trend persistence while avoiding speculative narratives.
Inflation Protection holds assets designed to maintain purchasing power: TIPS, commodities, real assets. A million dollars today won't buy what a million dollars bought in 2000. This role addresses money illusion, the tendency to feel wealthy because your account balance is growing while ignoring that purchasing power might be eroding.
Diversification addresses recency bias, the tendency to overweight recent performance and assume it will continue. This role utilizes non-correlated assets, such as interval funds or alternative strategies, intended to lower overall portfolio volatility. When everything feels like it's moving in lockstep, this role doesn't.
How Rules Create Discipline
Roles create the architecture. Rules make it operational.
Here's one example: If Reserves drop below 12 months of living expenses, all Growth contributions pause until Reserves rebuild.
Why? Because running Reserves too lean turns every market dip into an emotional crisis. You start checking your portfolio obsessively. You consider panic-selling at exactly the wrong time. The rule protects your psychology first, portfolio optimization second.
Yes, you might miss some market upside while rebuilding Reserves. But that's irrelevant if anxiety causes you to abandon the plan entirely during the next downturn.
This is what I learned watching my models navigate a war: good decisions are made upfront to avoid bad decisions later. Process over outcome. The system doesn't care about headlines. It cares about structural integrity.
What We Don't Share Publicly
Understanding roles and rules is step one. Implementation is where the sophistication lives:
Our diagnostic process for mapping your specific behavioral patterns to role priorities. The methodology for sizing each role based on your unique psychology and circumstances. The complete rule set and decision logic for each role.
Portfolio construction within roles, including which securities and why. The monitoring and adjustment systems that keep roles relevant as your life changes.
That's proprietary. And that's what you get when we work together.
The Next Crisis Is Coming
It always does. And when it arrives, you won't be thinking about asset allocation. You'll be thinking about the people you love, the uncertainty pressing down on your chest, the news you can't stop refreshing.
That's not the moment to be making investment decisions from scratch. That's the moment your system earns its keep.
A rules-based system is designed to remove emotional variables that can lead to impulsive decisions during market volatility. Your portfolio deserves the same discipline.
Want to see how R&R Investing would apply to your situation?
Schedule a call to explore whether this approach is right for your portfolio here:
Important Disclosure Information
Silveria Wealth Group, LLC ("SWG") is a registered investment adviser in the State of Idaho. Registration does not imply a certain level of skill or training.
The content on this blog is provided for informational and educational purposes only and should not be construed as personalized investment, legal, or tax advice.
No strategy or investment style can guarantee a profit or protect against loss. Investing involves risk, including the potential loss of principal.
Past performance is not a guarantee of future results. Please consult with a qualified financial professional, CPA, or attorney regarding your specific situation before implementing any strategies discussed here.
As a fee-only fiduciary, Silveria Wealth Group, LLC is compensated through assets under management (AUM). This creates an inherent incentive for us to recommend increasing the assets in your managed accounts. Additionally, we receive "soft dollar" benefits (such as research and technology) from our recommended custodians, Altruist and Charles Schwab, which provides an incentive to recommend their services.
