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"Does a less than 100% equities tend to offer higher returns long term or does it merely save on PeptoBismal?"

Fixed income investments tend to stabilize your investment. When stocks are doing well, they hold down your rate of return. When stocks are going down, they tend to retain the value of portfolio. Hence they reduce volatility. Nothing more; nothing less.

Every investor has to find a portfolio that matches his (or her) willingness to accept risk. But for say a 30 year old, I would say bonds are a foolish waste of time. You are probably at the low end of your lifetime earnings scale. You are stuggling to get your first year of earnings into savings. That is the best time for you to take risk. Because the funds are easily replaced. So they are best off to do 100% equities.

As you get closer to retirement, people should increase their fixed income proportion. And of course those who can live on something like 2% of their invested assets can be 100% in fixed incomes. The rest of us are forced to take some risk.

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