I’ve posted Entry #83 to my weekly Beyond Buy-and-Hold column at the Out of Your Rut site. It’s called How a Valuation-Informed Indexer Chooses His Stock Allocation.
Juicy Excerpt: The conventional advice is that only near-retirees need to be worried about the risk of stocks. It’s not so. Any investor who has a need for a portfolio of a certain size within ten years or so needs to take the uncertainty of the return on stocks into account. Most of us are in those circumstances. Some of us may need money to buy a house. Some of us may need money to start a business. Some of us may just not be able to cope with seeing our portfolio values stop rising for five or ten years.
The most important question is — How low of a stock return can you tolerate without feeling pressure to sell stocks?