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Diversifying Your Portfolio ~ 2021

We feel the need to discuss the importance of diversification in your investment portfolio. Given the recent performance in the US equity markets, there have been some conversations about investors being overexposed in stocks. It is vital to keep clear diversification parameters defined — even when there is large outperformance in one asset class. Let’s briefly touch upon revisiting your investment objectives and Bond Funds.


Revisit Your Investment Objectives.


Let’s take some time to examine your past and current investment objectives. Do they align? When investment objectives change, the underlying investments should evolve too. Some investors may need to consider shifting their objectives from capital appreciation to capital preservation. Or, a younger investor may be looking to reduce risk and modify their current strategy from aggressive growth to capital appreciation. Whatever the situation may be for you, we can work on this together and make a determination. By simply revisiting your investment objectives, we can simultaneously measure diversification. A simple conversation can have profound effects in the long run.


Got Bond Funds?


That title is a play on the old advertising campaign “Got Milk?” You may or may not be old enough to remember it — it launched in the mid-1990s! Boy, did this national advertising campaign have legs...it gave the milk industry real longevity and continues to be in use today in California.

Bonds have similar longevity characteristics. Often forgotten during equity bull market rallies, bonds are an integral component in most portfolios and can provide balance and potentially reduce risk in a portfolio. There are all types of bonds and bond funds available that could potentially support your investment objective. From tax-free municipal bonds to short term interest rate bond funds, there are a wide array of selections for just about any portfolio.


We conclude that diversification is of paramount importance to long term portfolio management. If there are certain market segments that are on your mind, let us know!

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