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I was just reading here on the Fool about bonds (Bond FAQs?), and was surprised to read that bonds aren't necessarily recommended for what the experts say is proper asset allocation. Is this crazy, or Foolish?

We are reassessing our asset allocation for our Fidelity 401k and our new Fidelity IRA. Someone at Fidelity recommended that we should have about 15% in bond funds (we currently have 7%). We hold a Fidelity bond index fund as well as PIMCO Total Return. She recommended balancing those out with a short-term bond fund, an intermediate government bond fund, and perhaps a multisector bond fund (which has outperformed the bond index). This is because the two funds we currently hold might be heavy on the mortgage side. Does this sound like a good recommendation?

Also, I looked up the additional funds she suggested on Morningstar, and the chart of "the hypothetical growth of $10,000" shows them underperforming the bond index. So is it worth it to go into these additional funds, or is it better to stick with the bond index fund?

Another quick question: We have a good portion of our 401k money in a total market index fund. But it turns out that about 70% of the value of such a fund is weighted toward large-caps. Is it smart to augment the total market index fund with some small- and mid-cap funds? How can one index this way and not be too heavy on the large caps?

Thanks for your help!

(cross-posted on "Ask a Foolish Question")
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