Investors should consider strong exposure to all asset classes, since the year has started off strong for the equity market. Mid-cap and small-cap in particular are distinctly outpacing the large-cap arena: + 7.5% and +6.5% vs. +5.5%, respectively, reports Ferbert. [2012 Was the Year of the Bond ETF]
As the stock market continues to mend, and hits some multi-year highs, investors should re-consider their asset allocations and strategy before the momentum gets going much more. Most of all, if it has been at least 6 months since your portfolio has been reviewed and re-balanced, there is no better time to do it because the market has shifted.
Tisha Guerrero contributed to this article.
Full disclosure: Tom Lydon’s clients own SPY, IWM, LQD, JNK, EEM.