Investors are realizing the hard way that they have too much exposure to stocks. The set-it-and-forget-it crowd is also realizing that their market-cap-weighted index funds are more overweight in certain sectors than they realized. That was the Truth Behind the S&P 500. Investment lessons are either taught the easy way or the hard way, but they will be taught.
Your Survival Guy is a longtime believer in a balanced portfolio. As I wrote in my March 2025 Survive & Thrive letter (subscribe here), finding balance in your portfolio with a stock-bond allocation between 75-25 and 25-75 is a good guide. A balanced 50-50 allocation can be a good place to start.
You can tell the benefits of diversification exist thanks to Harry Markowitz’s Efficient Frontier. Take a look at the chart below. That green band roughly covers the 75-25 to 25-75 range.
Action Line: When you want to talk about balance in your portfolio, email me at ejsmith@yoursurvivalguy.com.
