“With stock valuations near record levels, and relatively high interest rates, there’s a compelling argument to consider allocating more to bonds, not less,” says Rogovy.
It’s a double whammy. Large shares of portfolios are concentrated into fewer stocks, which trade at very risky valuations. Yet so many retail investors and professional advisers alike continue to choose index funds for equity exposure.
“Every time I’ve seen a client with 12b-1 mutual funds, I’ve been able to find a lower-priced alternative with virtually identical portfolio effect,” says Rogovy.
“Financial adviser is not a regulated term. Look for representatives of an RIA firm for true fiduciary advice,” says Rogovy.
“U.S. Treasurys are often thought of as a risk-free investment, but like all bonds, they are exposed to inflation risk. Theoretically, TIPS provide the same safety as Treasurys, while compensating for inflation. TIPS are therefore quite safe investments.”
“REITs are a great way to gain diversified exposure to real estate,” said Asher Rogovy, chief investing officer at Magnifina, a registered investment adviser with the Securities and Exchange Commission. “Exchange traded REITs also have the benefit of liquidity, whereas individual real estate investments might last decades.”
