Your Survival Guy was speaking with Dick Young this morning about the excellent performance of the Vanguard Wellesley fund, up 7.8% YTD, and as he pointed out, up an average of 6.13% for each of the last ten years. Not bad when compared to what cash paid over the same time periods, and as you and I know, what lower amount it could pay if, in fact, the Fed cuts rates this month.
“What you can’t afford to do, Survival Guy,” Dick pointed out, “is risk your safe money, your cash, in a balanced fund like Wellesley and hope [you know how he feels about that word] it does 6% every year.”
“I hear you, Dick,” I said.
“Wellesley just might do as well in the next ten years, but it might not.”
It’s why, when you look to deploy a pile of money, like Dick would imagine you doing every month when he sat down to write to you in Richard C. Young’s Intelligence Report, make sure you have your downside risk covered first.
Action Line: Study the arithmetic of losses and gain a master class in the perils of losing money. Always focus on your return of assets, and then, and only then, think about return on assets. When you want to talk about risk in your portfolio, email me at ejsmith@yoursurvivalguy.com. And click here to subscribe to my free monthly Survive & Thrive letter.
Originally posted on Your Survival Guy.
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