During periods of volatility, keep your time horizon in mind. Over short periods of time, many asset classes can experience a wide range of returns. However, over longer periods of time, they will typically have a more narrow range of returns. In the chart below, you’ll see that Large Cap Stocks have experienced a pretty significant range of returns (down 43% to up 61%) over one-year periods... READ MORE

Another decade came to a close last year. I thought it would be interesting to compare the last decade to the previous four decades. The table below shows returns for 5 primary asset classes and a globally balanced 60% stock/40% bond portfolio. For each decade the highest returning asset class is at the top while the lowest returning is at the bottom. A few observations: Stock returns across... READ MORE

A portfolio of all stocks is great when the market is rising. In that scenario (like the one we’re in today in the U.S. stock market), the old adage “a rising tide lifts all boats” holds true. But what happens when the market falls? Unfortunately, in many cases, the benefit of being diversified among many stocks goes away in times of stress since they all tend to go down in value.... READ MORE