When markets feel shaky or inflation dominates the headlines, it’s natural to start wondering whether you should branch out from the usual stocks and bonds. That’s when the term “uncorrelated assets” starts popping up. These are investments that tend to move independently from stocks and bonds, offering potential diversification benefits. But when it comes to retirement planning, is uncorrelated always better?

Let’s take a closer look at two commonly discussed uncorrelated asset classes: natural resources and commodities.

Natural Resources: Investing in the Land Itself

Natural resources are physical assets, such as timberland, farmland, water rights, or mineral royalties. These are tangible assets that often come with built-in inflation protection and low correlation to the stock market. For example, if you own farmland, your return is based on the productivity and value of that land, not whether the S&P 500 had a good year.

You don’t need to be a billionaire