NEW YORK (Real Money) -- Perusing The New York Times mobile site, as I do on infrequent mornings when I'm not by my hard copy, I came across this piece on risk, asset diversity and retirement by Tara Siegel Bernard. The article tried to use the recent JPMorgan Chase (JPM - Get Report) $3 billion trading loss as an example of mistaken risk management that common investors might learn from. On that premise alone, the piece was silly. But even more silly was that it appeared as one of the most emailed articles on the site, which convinced me of the deep ignorance most investors still hold regarding the capital markets right now and the opportunities in it.Most of the "truths" of retirement and risk on which we've depended for decades simply no longer exist, and most of us here at Real Money write for you (perhaps unwittingly) as if you already understand that. This might be a mistake, so here's a primer on the most important changes in investing you need to know about, just in case you still cling to the foolish notions that made Ms. Bernard's piece so well-distributed. If these few points strike you as being far too obvious to mention, chalk it up to the fact that you are much better equipped to care for your own money than the vast majority of New York Times readers seem to be -- and that you'll be richer for it. 1. Asset class correlations are higher than ever: There was a time when you could diversify inside stock sectors inside your portfolio and feel relatively safe, adding perhaps a bit of gold as a diversifier, or oil, or other currencies. Those days are over. While stock-picking or asset-class-diversification aren't entirely dead, the correlations among classes continue to rise, as does the volatility. So no matter how you try, if you are taking on assets such as stocks and commodities, there is ever more risk to them. As a result, everyone hopes to blunt that increased risk by turning to fixed income -- but: 2. Bonds are not risk-free. There was a time when bonds of all stripes were considered almost devoid of risk, at least as compared with equities. Municipal defaults, sovereign-debt credit default swaps and Greek and Spanish yields should convince you that fixed income now runs the gamut of risk -- and yet, despite all this:
3. Bond yields are relatively low. Fixed-income investing has always been about the chase for return, but never more so than what's been of late, since the great deleverage of 2008. Yield spreads aren't particularly narrow, but that's obviously because U.S. Treasury yields are so sparse and are likely to remain that way for years to come. So high-yield is still clearly high-risk, all while Treasuries at the short end of the curve are bounded by zero and don't legitimately have much more to give. The bottom line is that fixed income is hardly a free lunch -- and, while it's an important part of a diversification plan, it is not by any means a safe haven from the risks of stock markets. All of this leads to the thought that at least some of your investing will have to be done nimbly -- that merely allocating resources and taking a nap for a year or more just won't work in the modern investing world. It is why you are a subscriber here at Real Money: You recognize that at least a portion of your investment dollar needs to be moved rather boldly around in order for you to stay ahead. That's where we try to help. Using the tired old axioms of diversification and savings is no way to avoid risk in the modern markets. But knowing that will help you prepare for the decisions you need to make in order to keep your money safe and growing.