Investors are uneasy. To make sense of today’s volatility, it can be helpful to look at the past. It demonstrates that volatility isn’t one-directional or constant in magnitude, nor is it always spurred by the same type of risk.

The impacts of artificial intelligence (AI) could lead to the most rapid productivity and economic growth in a generation. As Vanguard Global Chief Economist Joe Davis explains, AI is expected to support most professions by improving efficiencies and allowing workers to focus on higher-value responsibilities. This Q&A is one in a series featuring Davis’s research on megatrends and the future impact that AI could have on productivity and the U.S. workforce. For more insights, visit our Megatrends hub.

Conventional wisdom may lead one to think that growth stocks are the way investors can position themselves to take advantage of the growth of artificial intelligence (AI). But as Vanguard Global Chief Economist Joe Davis explains, investors would be wise not to overlook value stocks. This Q&A is one in a series featuring Davis’s research on megatrends and the future impact that AI can have on the U.S. economy and investors at large. For more insights, visit our Megatrends hub.

Chasing performance and the fear of missing out can be psychological barriers to keeping a balanced and diversified portfolio. But investors must accept a universal truth: There will always be an asset class, sector, or security that will outperform your portfolio. Two simple thought experiments illustrate the folly of chasing outperformance at the cost of diversification.