Good Portfolios, Like Good Teams, Require Diverse “Rosters”

(edited transcript) … The thing we always talk to people about is that you wouldn’t build a football team with nothing but wide receivers. Yeah, they’re fast. They’re there to score some touchdowns. But really having the time, whether it’s to throw the ball, or whether it’s to realize those returns within your portfolio, you need time. And there are some linemen who do a lot of work, so that’s more conservative investments, fixed income investments. And I hear a lot of people will say like, “Well, I’m young. I’ve got tons of time.” That may be relevant within a qualified plan that you really can’t touch, but none of us know what’s coming down the pike. We don’t know about potentially getting laid off. We don’t know about an unexpected expense. And if suddenly you need those, you have no safe money. And maybe you’re in the midst of a bad market and all bad, bad breaks tend to happen in bunches, right? So that’s usually when they do come up, then you’re not going to be able to give those the time, you’re probably going to have to sell them, if not at a loss, at least before they can take off to have their gains. And so again, understanding the role really, of what they’re to do. Your bonds aren’t there to try to perform like stocks. They’re there to protect you or to have you be prepared. How much you might put in one? Certainly, age can impact that. So often, people near retirement think they’ve got to be way overweighted into one, or people who are younger, think, “Oh, you know, some of these other things are only for old people,” and that’s just not the case.

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Good Portfolios, Like Good Teams, Require Diverse “Rosters”

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