Explore stocks and bonds.
Learn how equities and fixed-income products can support different portfolio goals.
This page highlights how stocks and bonds can support both growth and capital preservation goals.
Stocks
Stock-market investing remains popular because of its potential for larger gains, but it also carries higher risk. Within a diversified portfolio, equities can add growth potential and help investors avoid being overly conservative.
Stock values often move independently from other asset classes such as real estate or bonds, which is why equities can also contribute useful diversification benefits.
Bonds
Bonds often perform better when stocks are under pressure, especially when interest rates fall and bond prices rise. They are commonly used as a safer haven for capital compared with equity ownership.
In simple terms, bonds represent debt while stocks represent ownership. Because debtholders are typically paid before shareholders in a worst-case scenario, bonds are often seen as the more defensive side of a portfolio.