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Bonds for Your Asset Allocation?

By Jon Strebler


THE CASE FOR BONDS is quite simply one that I don't get. Their primary benefit is the stable, relatively high income they can generate in exchange for a moderate amount of risk. I've lived through all of the interest rate scenarios, from 6% Treasuries in the early-1970s, to the 15% Treasuries of the early-80s, to the 2% Treasuries of today, and all those in between. There have been many great times in the past to own bonds, from an inflation and risk-adjusted basis. I just don't see how they fit into most people's asset allocation calculations these days.




Asset allocation: How to divvy up one's dollars or euros or shekels or whatever, amongst various investments, or asset classes. Traditional choices include stocks, bonds, "cash," and real estate, along with less-universally utilized gold, silver, art, diamonds, and a number of other possibilities. How much to put in each asset class? That's ... Log in or subscribe to continue reading.

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