ASSET ALLOCATION CALCULATOR
What is asset allocation?
Asset allocation is the division of one's investment portfolio between different types of assets, such as stocks, bonds, and cash.
Why is asset allocation important?
Choosing an asset allocation is probably an investor's most important decision. A study by Ibbotson Associates concluded that asset allocation decisions determine about 100 percent of investment performance for those who follow a low-cost, long-term investing strategy. Similarly, according to a Dalbar and Associates study, many investors underperform the market because they deviate from their asset allocation plan during market downturns. Investors who want to maximize their long-term investment returns must develop a risk-appropriate asset allocation plan that they can stick with in good times and bad.
How does the asset allocation calculator work?
The asset allocation calculator uses your answers to a brief multiple-choice questionnaire to arrive at a mix of assets that's consistent with your risk profile. Your recommended asset allocation will consist of four main portfolio building blocks: US Stocks, International Stocks, Bonds, and REITs.
The asset allocation calculator is provided free of charge and is intended for educational, self-help purposes. The results should not be interpreted as specific investment advice.
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