Use select charts from the Guide to the Markets to engage in portfolio discussions.
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Staying balanced in volatile markets
Building - and maintaining - an appropriate asset allocation can help increase returns and reduce volatility over time. Market volatility can be an opportunity to rebalance back to an allocation that reflects your investment and income objectives, time horizon and tolerance for risk.
Diversification can help improve returns and reduce volatility
- Individual asset class returns can vary significantly, especially in the short term.
- Since the asset classes do not move in lockstep, being appropriately diversified across a broader opportunity set can help reduce volatility and increase long-term returns.
- Because asset allocation is a key driver of returns, it's important to rebalance regularly to adjust for large market fluctuations and the resulting portfolio imbalances.