At the 18th Annual Ambulatory Surgery Centers Conference in Chicago on Oct. 28, Beata Kirr, senior portfolio manager, and Gregory D. Miller, senior investment advisor at Sanford C. Bernstein & Co., explained capital market trends.
Ms. Kirr discussed the importance of bonds in uncertain economic times. While stocks may yield more capital, bonds provide a level of security in investments. "Bonds add diversification and reduce risk in times of uncertainty," she said. She said that while the bond market has the lowest yield in history, bonds should still be included in a portfolio to balance potential heavy losses from stocks. "Do not abandon bonds. They've been the diversifier they need to be."
Ms. Kirr suggested a plan to invest 60 percent in stocks and 40 percent in bonds may be successful because it can produce high yields from stocks while providing safety from bonds. "Municipal bonds should be the bedrock, the safe part of your portfolio," Ms. Kirr said.
She also emphasized the importance of making decisions based on long-term outcomes rather than short-term gains. "Focus on the plan, not the moment. Today's risk-averse environment has created unusual opportunities in risk-bearing assets for long-term investors. Bonds will experience lower returns in the future, but are still a solid way of diversifying equity risk," she said.
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Ms. Kirr discussed the importance of bonds in uncertain economic times. While stocks may yield more capital, bonds provide a level of security in investments. "Bonds add diversification and reduce risk in times of uncertainty," she said. She said that while the bond market has the lowest yield in history, bonds should still be included in a portfolio to balance potential heavy losses from stocks. "Do not abandon bonds. They've been the diversifier they need to be."
Ms. Kirr suggested a plan to invest 60 percent in stocks and 40 percent in bonds may be successful because it can produce high yields from stocks while providing safety from bonds. "Municipal bonds should be the bedrock, the safe part of your portfolio," Ms. Kirr said.
She also emphasized the importance of making decisions based on long-term outcomes rather than short-term gains. "Focus on the plan, not the moment. Today's risk-averse environment has created unusual opportunities in risk-bearing assets for long-term investors. Bonds will experience lower returns in the future, but are still a solid way of diversifying equity risk," she said.
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