There are basically three ways to position your investment assets. You can loan the money, use it to own something or hold it in reserve.
The Loaning, Owning or Reserving choice is the most critical choice you will make. It will probably have more impact on your overall results than the more granular allocations that you will make within these super-categories.
While there are different forms of loaning, bonds are the predominant loaning vehicles in most portfolios. Owning can include a variety of assets, but is predominantly through stocks in most portfolios.
Because of the sudden recent negative stock market action, our view is that we may be entering a period that is more than merely a pause that refreshes...