Here’s How I’d Allocate $100,000 in Capital In This Topsy-Turvy Market

Market Dynamics - The stock market is experiencing contrasting dynamics, with significant investments flowing into high-growth sectors like AI, which are supporting overall valuations [1] - Conversely, a majority of stocks may be in bear market territory, indicating a weakening consumer and potential overvaluation in the post-pandemic era [2] Asset Class Valuation - Real estate may currently be more overvalued compared to prevailing interest rates, and while interest rates are expected to decrease, there are risks associated with bonds and other securities [3] Investment Options - The Vanguard Utilities ETF (VPU) is highlighted as a defensive investment, with one-third to one-half of its returns derived from dividends [4][6] - The iShares 20 Plus Year Treasury Bond ETF (TLT) offers a yield of 4.3% and serves as a hedge against stock market corrections [4] - The Vanguard FTSE Developed Markets ETF (VEA) provides exposure to non-U.S. developed markets with a low expense ratio of 0.03% [4] Utilities Sector Insights - The utilities sector is characterized as defensive, with the Vanguard Utilities ETF (VPU) being a top pick for long-term investors [6] - Utilities companies typically exhibit sustainable cash flow growth, supported by regulatory approval for price increases, which assures investors of returns [8]