This Old-Timey Stock Ploy Is Dead (Try This “1-Click” Dividend Plan Instead)

If you’ve been investing long enough, you’ve no doubt run across the 60/40 portfolio. Maybe you’ve used this approach yourself. Or maybe your financial advisor told you about it (it’s an advisor favorite!). As the name suggests, the 60/40 portfolio is simply a portfolio that seeks to automatically balance risk by holding 60% in stocks and 40% in bonds. It sounds sensible enough, but history shows that people who invest by this rule have been leaving a lot of money on the table for a long time: 60/40 Portfolio Pays Too High a Price for Low Volatility One quick glance at US stocks, seen here in purple through the Vanguard Total Stock Market ETF (VTI), and bonds, in orange through the Vanguard Total Bond Market ETF (BND), shows a problem.… Read more