Diversification

Over the past few days, we have seen many global markets reaching new 12 month highs. With markets clearly in recovery mode, it is interesting to note that bond funds continue to attract a significant percentage of the new assets being invested in mutual funds. Many experts argue that this indicates that investors are missing the recovery in the stock market. I disagree, and believe it is a healthy sign, as investors actually appear to be getting the message of diversification. Buying bonds, real estate, and even gold, can significantly reduce the overall risk for investors. The massive flow to bonds may not be an intentional move toward diversification, but regardless of the reasons, I believe it is a sign of a healthy recovery in the overall investment world. Tune in tomorrow at 9:30 for Beyond Funds Market Weekly, and I will discuss how you can benefit from diversification.