I don’t mind taking stock market risk for the promise of decent rewards.
That’s why I’m comfortable owning 60 percent stocks, 40 percent bonds.
Such a portfolio won’t likely grow as much as an investment allocated 100 percent to stocks.
But it’s a lot more stable and it helps investors sleep at night when the stock market plummets.
But what if the stock market scares you?
What if a stock market portfolio drop exceeding 6 percent would drive you to drink?
In such cases, you might consider stuffing your portfolio with bonds or CDs. But that would be foolish.
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