Welcome to Bootcamp 1: Stocks vs. Bonds


Kicking off this 9-part investment series, Paul Merriman dives into the most critical decision every investor faces: stocks vs. bonds. This foundational session sets the stage for building a successful portfolio, whether you're just starting out or refining your investment strategy.

What You’ll Learn in Bootcamp 1:


Stocks vs. Bonds: A Deep Dive

  • Stocks: High growth potential but higher risk.
  • Bonds: Stability and income with lower returns.
  • Why this decision shapes your financial future

The Role of Risk and Return

  • Learn how short-term, intermediate, and long-term bonds differ in risk and performance.
  • See why stocks are a better choice for young investors with time on their side.

The Power of Compounding Over Time

  • Understand how $100 invested in stocks in 1928 could grow to over $1 million, while the same investment in bonds would yield just $2,300.
  • Discover why time narrows the range of outcomes, making long-term investing a winning strategy.


Diversification: The Key to Success

  • Why owning a mix of stocks and bonds is essential for stability and growth.
  • How to balance your portfolio based on your age, goals, and risk tolerance.


Why Stocks and Bonds Matter

Paul Merriman explains that while bonds provide safety and consistent income, they may not be ideal for long-term growth. Stocks, on the other hand, offer unparalleled potential for wealth accumulation, especially for younger investors.


By analyzing nearly 100 years of historical data, Paul highlights the importance of diversification and the benefits of holding a mix of asset classes, including:

  • Short-term bonds for safety.
  • Intermediate-term bonds for moderate risk and return.
  • Stocks for long-term growth.


Key Takeaways for Investors

  • For Beginners: Start with stocks to maximize growth and take advantage of compounding.
  • For Retirees: Balance your portfolio with both stocks and bonds for stability and income.
  • For Everyone: Diversify across asset classes to reduce risk and improve returns.


Why Historical Data Guides the Future

While no one can predict the future, Paul emphasizes the importance of learning from the past. By studying market trends since 1928, investors can gain valuable insights into how stocks and bonds perform over time, helping them make informed decisions about their portfolios.


Next in the Series: Bootcamp 2 – The Ultimate Buy and Hold Portfolio

This is just the beginning! In Bootcamp 2, Paul will explore how small adjustments to your portfolio—like adding value stocks or international equities—can significantly impact your returns and risk.


Join the Conversation

Have questions or want to dive deeper? Reach out to Paul at paul@paulmerriman.com or explore his website for more resources. Don’t forget to share this Bootcamp series with friends who are just starting their investment journey!