In last month's blog, "Get Along, Little Market," we discussed the benefits of diversifying your investments to minimize avoidable risks, manage those that are unavoidable when we're seeking market gains, and better tolerate market volatility along the way.
Our next topic: understanding how to build your diversified portfolio to effectively capture market returns. To do that, we must understand where those returns actually come from.
Market returns represent something deeper than the ups and downs of stocks and bonds. They are our compensation for providing the financial capital that feeds the human enterprise going on all around us.