Diversification has the potential

to help portfolios in rough times.

In any stock market climate, proper asset allocation matters. In a down market, you could argue that it matters more than anything else.  Did you have a well-diversified portfolio during the fall of 2008? That was a time when the importance of having a bond allocation and proper equity diversification really hit home. Nearly all investors were hit hard, but some were hit harder than others. What percentage of your portfolio was held in Treasuries (or cash) at that time?  What about the latest correction in 2010?

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