Asset Allocation 101Īsset allocation involves dividing an investment portfolio among different asset categories, such as stocks, bonds, and cash. Let’s begin by looking at asset allocation. This publication will cover those topics more fully and will also discuss the importance of rebalancing from time to time. If that makes sense, you’ve got a great start on understanding asset allocation and diversification. By selling both items - in other words, by diversifying the product line - the vendor can reduce the risk of losing money on any given day. And when it’s sunny, the reverse is true.
Street vendors know that when it’s raining, it’s easier to sell umbrellas but harder to sell sunglasses. After all, when would a person buy both items at the same time? Probably never - and that’s the point. How did you learn them? Through ordinary, real-life experiences that have nothing to do with the stock market.įor example, have you ever noticed that street vendors often sell seemingly unrelated products - such as umbrellas and sunglasses? Initially, that may seem odd. Required Minimum Distribution CalculatorĮven if you are new to investing, you may already know some of the most fundamental principles of sound investing.Investment Professional Background Check.Working with an Investment Professional.Five Questions to Ask Before You Invest.
