Home
Cited Authors
Carlson, Ben

Carlson, Ben

last modified on Sun, 13 Aug 2023

Random Link ¯\_(ツ)_/¯

Jun 3, 2020

»

14. A Life-Cycle Guide to Investing 5 min; updated Aug 13, 2023

5 Asset Allocation Principles

History shows that higher risk bears high reward

From 1926 to 2017:

	Average Annual Return	Year-to-Year Volatility of Returns
Small-company stocks	12.1%	31.7%
Large-company stocks	10.2%	19.8%
Long-term government bonds	5.5%	9.9%
US Treasury Bills	3.4%	3.1%

The risk of investing in stocks and bonds depends on the hold duration

From 1950 to 2017, the S&P averaged 10% per year. However, there were +52% and -37% on some years.

...