This Week/Feb. 4-10

SET A FLOOR FOR FINANCIAL PAIN. Suppose you have $400,000 saved. What’s the minimum value below which you never want your portfolio to fall? Let’s say it’s $300,000, or $100,000 less. Divide that $100,000 by 0.35 and you get $286,000. That’s the maximum sum you should have in stocks. Why 0.35? In a bear market, the average loss is 35%.

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