fbpx

60/40 Portfolio

A 60/40 portfolio is a classic formula used in investing. It represents a portfolio allocation consisting of 60% equities (usually diversified to make sure the risk is spread out) and 40% fixed income instruments like bonds.

This traditional investment strategy is commonly recommended for moderate-risk investors, due to the ideal balance between risk and return. 60% invested in equities offers a decent potential for solid returns, while the remaining 40% invested in more conservative, low-returning bonds helps to offset potential damage to the portfolio during periods of stock market volatility. As with all investment strategies, this comes with no guarantees and can be adjusted based on individual risk tolerance and investment horizon.

Leave a Reply

Your email address will not be published. Required fields are marked *

Related Posts

backtesting
Trading Systems

6 Reasons Why Backtesting is Not Enough

Beyond Backtesting for Consistent Returns In the pursuit of consistent returns in trading, relying solely on back-testing is insufficient. Market dynamics, over-optimization, data quality, execution

Read More »

Time Value

In options trading, Time Value or Theta is a crucial concept that denotes the rate at which an option’s price decays or decreases as time

Read More »
trade for a living
Money Management

Can I trade for a living?

Is this the real life? Or is it just Fantasy? Freddie Mercury Trade for a living! Ahh … imagine what that would be like. All

Read More »