You can own all 500 stocks in the S&P 500 and still own just one thing.

That’s the uncomfortable premise at the center of Jim Rickards’ case for true diversification – and it’s one that most investors never fully reckon with until a black swan event forces their hand.

Rickards, the New York Times bestselling author of Currency Wars, The Death of Money, and The New Case for Gold, has spent decades arguing that paper assets – stocks, bonds, ETFs – don’t provide the diversification investors think they do. In a crisis, when liquidity is what people are chasing, correlations converge. Sectors stop mattering. Everything sells off together.

So what does real diversification actually look like?

In this conversation, WorthNet puts that question directly to WorthNet Partner Adviser and Sprott Wealth Management CEO Rob Villaflor – one of the few advisers in the U.S. who has built an entire practice around the kind of hard-asset diversification Rickards describes.

Villaflor agrees with Rickards – and goes further.

He explains why Sprott recommends an allocation to physical gold and silver across all client portfolios… why the vehicle you use to hold that gold matters as much as the decision to own it… and why, in his view, gold isn’t a return generator. You don’t want to use it. But you’ll be glad you have it.

The conversation also covers:

• Why physical gold trusts may offer meaningful tax advantages over standard gold ETFs
• Why cash – despite feeling safe – erodes in ways gold doesn’t
• How Sprott’s team of in-house geologists gives the firm a boots-on-the-ground edge in evaluating early-stage mining companies
• The “whip” framework – from legendary resource investor Rick Rule – for understanding how physical gold, producing miners, and junior miners move differently in a rally
• Why Villaflor believes the hard-asset portion of most U.S. investors’ portfolios is significantly underserved

Rob Villaflor has been in financial services since 1992. He has worked a trading desk, served as a broker, and held roles in management and compliance – giving him a view of this business from nearly every angle.