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What is Asset Allocation? Comments

  • By Jocelyn Black Hodes, DailyWorth's Resident Financial Advisor
  • June 21, 2013

Asset allocation is an investment strategy to balance risk and return by dividing monies between three main asset classes -- equities (stocks), fixed-income (bonds), and cash and equivalents -- that is based on an individual's goals, risk tolerance and investment horizon. Asset allocation is the idea that an appropriately-balanced portfolio consisting of a variety of investments gives you a better chance of growing money over time than trying to buy and sell individual securities at the "right" time. 

 

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