Stanasolovich also recommends purchasing foreign stocks, foreign bonds of developed and emerging markets countries and foreign currency exposure, which can be gained through exchange-traded funds. "A lot of things would work," he says.
But remember that alternative investments often carry more risk than plain-vanilla stocks and bonds, he cautions. "It's not the right thing to do for all investors."
More conservative approach
Heyman, who takes a more conservative approach, doesn't see the need for taking on this additional risk. "I'm talking about people who want to save and preserve their money. The other side is people who just want to make money."
Blue chip stocks provided him and his clients peace of mind during the financial crisis, because apart from some financial services firms, you knew they were going to be around afterward.
The key issue for those using Heyman's strategy is that "people have to be very sensitive not to cheat on it" by taking more risk in search of a higher return, he says. "People want higher yields than Treasuries provide, so they put themselves at risk."
In terms of allocation, Heyman recommends anywhere from 30 percent to 80 percent stocks, 5 percent to 10 percent gold, and then the rest in Treasuries and cash. Be honest with yourself about what risk you can tolerate and stick to it, he says.
Stocks, stocks and more stocks
Lieberman has a somewhat unique take on diversification. He thinks it can be achieved through a portfolio of almost exclusively stocks.
"For most of my life, I've been 100 percent in equities," he says. "The more assets people have, the more they can diversify away from single-security risk -- therefore, the more equities they should have even if they're older."
Lieberman thinks the best way to diversify is to buy stocks across a mix of industries. "That could include autos, manufacturing, some service industries, retailers, financial services," he says. "That's the primary way."
Buying stocks of different-size companies doesn't "accomplish much" in terms of diversification, he says. Lieberman also sees no need to buy foreign stocks, as you can easily purchase equity in U.S. companies that derive much of their revenue overseas. That way you're sure to get a stock that trades on a U.S. exchange denominated in dollars.
"To the extent that someone is looking more for income, they would tilt away from growth stocks to mature companies with dividends," Lieberman says. "Perhaps they'd also have some fixed income. To the extent people want more growth, they'd push in the other direction."
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