Barbell Strategy

The barbell strategy is an investment approach that involves dividing a portfolio into two extremes: low-risk, stable investments and high-risk, high-reward investments, with little to nothing allocated to middle-risk assets. The idea behind this strategy is to balance the potential for growth with the safety of capital preservation. On one end of the "barbell," an investor holds safe, stable investments such as government bonds. On the other end, the investor takes on high-risk, high-return investments like stocks or speculative assets. \

Example

An investor might allocate 50% of their portfolio to long-term government bonds and the other 50% to high-growth technology stocks, avoiding medium-risk assets like corporate bonds.