So I was looking at portfolio composition models on Vanguard. It says over the past 100 years an all stock portfolio would net you 10.1% annually on average. On the other hand, a 60/40 portfolio would perform 8.5% on average annually with half the volatility. Which got me thinking.
Why not do 60/40 portfolio? When the stock market drops and bond values rise, you sell the bonds and buy the stock market dip? Couldn’t you outperform the 1.5% difference by having “dry powder” for stocks when things get bad?
Submitted March 25, 2024 at 01:25AM by Wafflegasmm https://ift.tt/bDHLrca
