Widely held investing wisdom states that when "stocks fall bonds rise", and therefore, that wise investors should own a diversified mixture of both assets. In general, this is true, and it is an undeniable fact that a "60/40" bond-stock portfolio has delivered greater risk-adjusted returns over the past few decades than either asset.
This is demonstrated using a portfolio made up of 30% of international bonds, 30% of U.S long-term Treasuries, 20% U.S equities, and 20% international equities. As you can see below, this allocation strategy has delivered solid and relatively consistent long-term returns:
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