Group 1 - The core concept of fund advisory is to address the issue where funds make profits but investors do not [4] - Fund advisory serves as a solution to enhance investor returns through professional guidance [5] - The article introduces a free course on fund advisory, providing insights and learning materials for better understanding [5][7] Group 2 - The article discusses three classic strategies for stock-bond allocation, emphasizing the importance of asset allocation in different market conditions [10][12] - The first strategy is valuation-based allocation, where funds are shifted to cash or bonds when the stock market is expensive, allowing for opportunistic buying during market dips [13][15] - The second strategy is target risk strategy, which maintains a fixed stock-bond ratio and rebalances when deviations occur, impacting long-term returns and risks [18][19] - The third strategy is target life cycle strategy, which adjusts stock and bond allocations based on age, promoting higher stock exposure in younger years and more stable assets as one ages [21]

Group 1 - The article emphasizes the importance of asset allocation and rebalancing strategies in investment, highlighting that different asset classes (stocks and bonds) do not move in sync, necessitating adjustments to maintain desired risk levels [7][10][60] - It introduces the concept of "rebalancing" as a strategy to adjust asset proportions back to their original targets after market fluctuations, which can enhance overall returns [8][25][59] - The article outlines four common rebalancing strategies: periodic rebalancing, threshold-based rebalancing, valuation-based rebalancing, and risk parity rebalancing [27][28][35] Group 2 - The article discusses two specific rebalancing strategies used in the author's investment approach: growth/value style rotation and stock/bond rebalancing [39][47] - It provides an example of how to implement stock/bond rebalancing, illustrating the process of adjusting allocations based on market conditions, such as selling bonds to buy stocks during market downturns [50][54] - The article concludes that market volatility can create more opportunities for rebalancing, ultimately benefiting investors by enhancing returns [61][62]

Core Viewpoint - The article discusses three classic asset allocation strategies between stocks and bonds, emphasizing their historical significance and application in investment practices. Group 1: Asset Allocation Strategies - The first strategy is the "Valuation Allocation Strategy," used by Graham and Buffett, where cash and bonds are favored when the stock market is overvalued, allowing for opportunistic buying during market downturns [9][10][12]. - Buffett's cash holdings reached $140-150 billion in 2021 during a high valuation period, which decreased to around $100 billion in 2022 as he made investments during a market decline, and by 2023-2024, his cash and short-term treasury holdings grew to a record high of $334.2 billion [14]. - The second strategy is the "Target Risk Strategy," which maintains a fixed ratio of stocks to bonds, such as 50:50 or 40:60, and involves rebalancing when the allocation deviates significantly from the target [20][22]. - The third strategy is the "Target Lifecycle Strategy," introduced by Fidelity in the 1990s, which allocates assets based on age, typically following the formula "100 - age" for stock allocation, ensuring a minimum of 30% in stocks even in older age [32][34][36]. Group 2: Performance Metrics - The article presents a backtest of different stock-bond ratios, showing that higher stock allocations lead to higher annualized returns but also increase volatility and maximum drawdown [30]. - For example, a 90:10 stock-bond ratio had a maximum drawdown of -42.49% with an annualized return of 9.7%, while a 10:90 ratio had a maximum drawdown of -4.81% with a return of 5.2% [30]. Group 3: Importance of Rebalancing - The article emphasizes that asset allocation and rebalancing are crucial for optimizing investment returns, with rebalancing being referred to as a "free lunch" in investment [41][44].