Bonds Smooth the Ride
Bonds provide stability during market downturns, helping to preserve wealth when stocks experience significant volatility. By maintaining a balanced allocation, investors can mitigate losses, as demonstrated in a hypothetical scenario where a portfolio's value is better protected. While equities may offer higher long-term returns, the short-term risks associated with them lead some to question the necessity of such exposure.In this clip
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034R | What’s Your Risk Tolerance?
Related Questions
Why are bonds important in a portfolio in the context of the episode 411 | The Simple Path to Wealth | JL Collins and the clip Understanding Bond Ballast?
Why are bonds important in a portfolio in the context of the episode 411 | The Simple Path to Wealth | JL Collins and the clip Understanding Bond Ballast?