- 4th Quarter 2018 Asset Allocation Models
- 2nd Quarter 2018 Asset Allocation Models
- 1st Quarter 2018 Asset Allocation Models
- 4th Quarter 2017 Asset Allocation Models
- 3rd Quarter 2017 Asset Allocation Models
- 2nd Quarter 2017 Asset Allocation Models
- 1st Quarter 2017 Asset Allocation Models
- 4th Quarter 2016 Asset Allocation Models
- 3rd Quarter 2016 Asset Allocation Models
What is Asset Allocation
Asset Allocation is an investment strategy that attempts to balance risk and reward by apportioning your investments over multiple asset classes. The general idea is that instead of investing the bulk of your assets in a particular investment or sector, by choosing different investments over several different sectors, there is a greater likelihood of generating a more consistent positive return over the long term and can help mitigate the affect of dramatic market swings on your portfolio.
Asset Allocation uses the assumption that each asset class will react somewhat differently to an event. For example, news on the price of oil may cause investments in one asset class to decline where conversely the value of other investments will rise.
If you the investor where focused on obtaining consistent income then your portfolio will be heavily weighted in fixed income. If you were more focused on long-term growth then you portfolio would most likely be more heavily weighted in equities or some variation of growth-oriented investments.
Basic Asset Classes
The following are just some of the basic asset classes that one might include in their portfolio and the below image shows how ones investments might be allocated. This is different for every investor based on may factors, such as age, income needs, risk tolerance, etc:
- Cash and cash alternatives
- U.S. equities
- Non-U.S. equities
- Fixed income
- Real estate
- Alternative investments