Are you still playing by the old rules in Investing?
In this excerpt, financial writer Jonathan Clements argues that many investors and financial advisors are still following outdated financial principles that no longer apply in today’s market. He gives three examples of such principles: the belief in star fund managers, reliance on outdated yardsticks for measuring market valuations, and the idea of investing solely in bonds for retirement income. Clements suggests that investors should instead focus on earning a healthy total return by allocating at least half of their portfolio to stocks, and using bonds as a complement to stocks rather than a standalone investment.