No one wants to lose money they invest, that's why we need strategies. It is very important that you have a plan in place to invest your money in various kinds of investments to get a good return. I believe in taking professional's help while planning my investment strategies.
Diversification does not imply that you have to choose between the three. You can have both stock and bonds and not be adequately diversified. You also have 20 different mutual funds and not be properly diversified if they all have a high correlation. Countless academic studies in the field of investing have demonstrated that about 90% of performance is dictated by Asset Allocation. Diversification is what happens within an Asset Allocation. Proper asset allocation means exposure to a multi asset portfolio, which would then be diversified within each asset class. For the average investor this is best achieved through mutual funds and ETF's.
Attached is an academic piece that demonstrates the benefit of a multi asset portfolio.
We use Relative Strength Asset Allocation strategies. This methodology keeps you on the right side of the market, meaning in stocks, bonds, a mix of both, or cash. It has proven to be a profitable strategy and a stress reducer.