FYI: Traditional portfolio management is based on the premise that you allocate to stocks for growth and bonds for stability. Bonds earn their place in a portfolio by providing valuable diversification benefits as they typically counteract stock market losses during bear markets. Bonds can act as both a source of dry powder when stocks are falling and as an emotional hedge for those investors who either aren’t willing or don’t need to take a large amount of equity risk.
Regards,
Ted
http://awealthofcommonsense.com/2016/08/do-stocks-diversify-bonds/
