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Greetings, Calverton, and welcome. You asked:

<<My mutual fund is yielding 6.35%. Why would I want to invest in bonds and and risk the ups and downs that bonds present?>>

You do not say in what your mutual fund is invested. If stocks, by nature they are more volatile than bonds in the short term. Hence, you would adjust for that volatility by adding enough bonds to reach your comfort level for the amount of money you can lose in the short term without losing sleep.

OTOH, if you are invested in the money market, then I would concede in the ordinary course of events bonds would be more volatile in the short term. In that case, you would invest in bonds (as well as stocks) to earn a greater rate of return over the long(er) term.

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