No. of Recommendations: 10
I don't have a written plan yet. I have to think of something that I can emotionally stomach. Maybe for every 10% decline, you would go add 1% to stocks, and be at 71/29.
That's not a great bet on stocks, but when the world looks like it is going to end, it is very hard to place a huge bet on stocks.
If you start at 70/30 and stocks drop by 10% while bonds hold steady, then you're at about 67.7% stocks and 32.3% bonds. Getting to a 71/29 balance at that point requires that you add much more than 1% to your stock position.
You'd probably do okay just to rebalance back to 70/30 periodically - once per quarter or once a year.
Elan
