Prospect of Lean Returns For Stocks, Bonds Suggest Getting Creative

Rochester Business Journal
June 14, 2019
Mark Armbruster

Most investors have a mix of stocks and bonds in their portfolios. Stocks are there for long-term growth, whereas bonds are generally pur­chased for stability and income genera­tion. This has worked out pretty well historically, as stock returns averaged over 10 percent annually since the 1920s, and bonds have yielded over 5 percent, according to Ibbotson data. A balanced portfolio of 60 percent in stocks and 40 percent in bonds has become the de fac­to standard for many investment portfo­lios, as the returns have been substantial enough to meet most investors’ returns, while keeping risk in check.