Does a 40% Bond Allocation Make Sense in Today’s Portfolios?
Whether you’re the kind of investor who meets regularly with an adviser or the set-it-and-forget-it type who rarely looks at your 401(k), there’s a good chance your portfolio is set up with something close to a 60/40 mix of stocks and bonds.
That asset allocation — with approximately 60% of an investor’s money in stocks and 40% in bonds — has been the traditional model for decades. It’s based on the conventional wisdom that the “safer” bond allocation will offset the risk of investing in equities, allowing investors to maintain a reasonably healthy balance in their portfolio whether the stock market is flourishing or floundering. Bonds have long been viewed as a good
