Over 30 year-year periods, portfolios with 100 percent stocks typically trounce portfolios with 60 percent stocks and 40 percent bonds.
That’s why smart investors maintain diversified portfolios. They don’t pay attention to bond market interest rates. They don’t pay attention to stock market movements. They ignore economic forecasts and goofy horoscopes.
You might have the courage to stomach big declines. If that’s the case, build an assertive or aggressive portfolio with a low bond allocation. Your Thor-like resolve will help you make a lot of money. But if you don’t see an Action Hero when you look into the mirror, be honest with yourself.
Andrew Hallam is a Digital Nomad.
https://en.swissquote.lu/international-investing/smart-investing/why-having-bonds-your-portfolio-can-help-boost-returns
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