Stocks aren't the only asset class to consider for investors interested in a growth-oriented portfolio.
The goal of an asset allocation strategy is to have a number of different asset classes with a low correlation to one another. Even if someone is diversified through the entire universe of equities, all can react similarly to a bad business cycle.
"You have to think about the underlying factors that they might be exposed to," says Farr.
Farr recommends that investors consider gold and Treasury securities when looking for assets that are not correlated with the stock market.
Both "would be a safe haven when the economy starts to do poorly. Or gold sometimes responds to concerns about inflation. Treasury securities ... are counter-cyclical in that when the economy gets weak, interest rates tend to decline and investors pursue safer assets," Farr says.
Heed this warning, though: In 2008, when the financial crisis unfolded and the stock market tanked, every asset class was adversely affected.
Since that's bound to happen from time to time, your investment plan should be based on the worst-case scenario while you hope for the best.