Just to reiterate, bonds (mixed with stocks) provide an improved risk-adjusted return. The concepts of stability, safety, ballast, etc. are psychological terms that don't accurately describe the uncorrelated interaction of a mix of stocks and bonds. What that mix does is reduce overall portfolio volatility. I'm concerned that some investors think bonds are "stable, safe, ballast" and that they think the bond portion of their portfolio pays them interest, but can never lose value, which is not the case. You seem to clearly understand that, so apologies for the reiteration, but this is more for the "silent guests" that read posts here, never post themselves, but potentially take action on what they read.As a whole, I want to have bonds in my portfolio to add some stability. Yes, there have been times where bonds and stocks have both gone down in a year, but there have also been times where stocks have gone up and bonds down, bonds up stocks down, and the value of both growing. For those reasons, I think it adds a layer of diverstiy and safety that I like in my portfolio. I am not concerned about a 10 year rebound, as it just means all the good stocks that I'm purchasing will be on sale
Bonds are not safe, they just reduce overall portfolio volatility if you have a mix of stocks and bonds. You should not focus on either component individually; look at your portfolio return and volatility as a whole.
Statistics: Posted by bonesly — Fri Jan 26, 2024 12:51 pm