The Good (and Some Bad) of Balanced Funds

By Anonymous

The big advantage is diversification. The disadvantage is a lack of allocation flexibility.

“Balanced” mutual and exchange-traded funds—which invest in both stocks and bonds—get less attention than their single-minded brethren.

With their typical allocations of 60% stocks and 40% bonds, balanced funds give investors exposure to both markets, and provide automatic rebalancing at times when big moves in either or both markets can push fund weightings out of whack.