How to prepare and survive a Market upturn. Something that not many investors see as a RISK

Ever since the financial crisis investors have been bombarded with books, blog posts, articles and advice about how to survive the next bear market/Lehman Brothers/black swan/recession/subprime/1987/big short moment in the markets. And don’t get me wrong, preparing yourself mentally for market downturns can be a helpful exercise. These things are inevitable so planning for a wide range of outcomes that includes the potential for large losses in risk assets is a decent way to ensure that you don’t panic when markets do fall. But there’s another risk in the markets that most investors don’t spend too much time worrying about — a melt-up in prices. It would seem to me that all of the ingredient

Do Stocks Diversify Bonds?

Traditional portfolio management is based on the premise that you allocate to stocks for growth and bonds for stability. Bonds earn their place in a portfolio by providing valuable diversification benefits as they typically counteract stock market losses during bear markets. Bonds can act as both a source of dry powder when stocks are falling and as an emotional hedge for those investors who either aren’t willing or don’t need to take a large amount of equity risk. At current interest rate levels many investors are beginning to question this dynamic. The new question then becomes: what happens to stocks when bonds lose money for investors? Investors don’t usually think about the relationship

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