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Article by Josh Brown: "If I only had thirty seconds to teach a young person about asset allocation, I probably wouldn’t bother with anything written. I’d also dispense with any sort of formula, equation or model.
Instead, I’d come armed with just one chart and force my erstwhile pupil to spend the entire half-minute staring at it.
That chart is below, a gem from Professor Jeremy Siegel"
Its a nice chart and informative but if I had 30 secs I would say that the difference between holding 100% stocks and 80% combined with bonds and money market funds will be very little over time and you will have fewer really bad years which could/would discourage you from investing.
I agree Jerry. I try to segregate all three into distinct investment "pools". Having three separate invesments pools (Stock, bonds,& cash) allows an investor to d.c.a. into each over time, reallocate/rebalance periodically and not have the need raid the stock or the bond positions when an emergency requires an investor to "sell" some cash.
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