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Surviving Volatility
2008-09-08 06:12:00 Markets in the past month have been whipsawing back and forth, this volatility has caused a lot of investors to retreat to cash until the markets show some direction. While this may be a prudent play if you are a day trader, it is not if you are a long term investor. Here are 5 ...
Tactical Asset Allocation Strategy
2008-04-30 13:10:00 Tactical asset allocation strategy is a moderately active portfolio management strategy, which includes adjustments of investments with respect to short-term goals. Although the basic idea is to diversify investments and limit risks, investment preferences are given to different asset classes with respect to short-term yield predictions.A tactical asset allocation strategy starts just like a strategic asset allocation strategy with diversification of portfolio with respect to long term goals in mind. The investor/portfolio manager then readjusts the investments with different asset classes. If equities are predicted to perform well in the near future, he/she allocates more capital for it; and if bonds are predicted to perform well, then more investments in bonds, and so on. Once the preferred result is obtained, the investor returns to the original allocation ratio desired for long-term goals.Success with tactical asset allocation requires good money management, and ability to inter...
Strategic Asset Allocation Strategy
2008-04-23 12:34:00 Strategic asset allocation strategy is a portfolio management strategy, which includes periodical adjustments of investments with respect to the long-term goal. The basic idea is to diversify the investments and limit the portfolio volatility. But strategic asset allocation strategy does not include over-investing in either high-profit or low-risk securities.In general, strategic asset allocation strategies do not consider the short-term performances of allocated assets. They only look for long-term performances, which is often positive to almost all investments. For example if stocks grow at 10% and bonds at 5% annually, then with a 50-50 asset allocation 7.5% yield is predicted, and the portfolio manager adjusts asset allocation to meet this yield.Strategic asset allocation strategy requires long-term anticipation and forecasting. Portfolio managers consider various economic indicators and industry performances when readjusting the investments. If higher inflation rate is expected...
Asset Allocation for Beginners
2008-04-08 07:00:00 One of the primary goals of asset allocation is to balance risk and reward from the overall investment choices. Determining overall risk and reward is extremely important when it comes to the planned time line of your investment. For example, if you are a 25 year old, you want to choose assets that ...
By: Resources zone
Beginner’s Guide to Asset Allocation
2008-04-04 07:00:00 One of the primary goals of asset allocation is to balance risk and reward from the overall investment choices. Determining overall risk and reward is extremely important when it comes to the planned time line of your investment. For example, if you are a 25 year old, you want to choose assets that ...
By: Resources zone
Recession? Rough Market? Don?t Panic - Determine the Right Asset Allocation
2008-02-21 15:19:00 In turbulent times, we are often our own worst enemy when it comes to investing. Chasing returns and running from perceived risk lead investors to buy high and sell low. Understanding asset allocation can help you sleep at night and deliver returns over the long haul.In turbulent times, we are often our own worst enemy ...
By: cash For Debt
Using futures in asset allocation
2008-02-14 07:42:00 Transaction costs are the main hindrance to the active or tactical asset allocation process. The transaction cost has to be paid for whether the investor is buying or selling to accomplish a shift in the asset mix of his portfolio. The investor can do the same buying (calling) and selling (putting) through futures to ...
Using futures in asset allocation
2008-02-14 07:42:00 Transaction costs are the main hindrance to the active or tactical asset allocation process. The transaction cost has to be paid for whether the investor is buying or selling to accomplish a shift in the asset mix of his portfolio. The investor can do the same buying (calling) and selling (putting) through futures to ...
Asset Allocation Process
2008-02-12 09:40:00 The asset allocation process would require a disciplined structure based on three assumptions: 1. The securities market indicates the rate of returns available in the various asset classes. 2. There is a normal relationship among these implied returns. 3. The securities market correct disequilibrium conditions when they occur. A more detailed study for a better understanding ...
2007 Year End Review (III): Performance and Asset Allocation
2008-01-07 22:44:00 This is the third part of our Year End Review, in which I have so far gone through financial moves we made in 2007 and how what we have done affected our net worth, which includes both new money and price appreciation of our existing investments. The latter is the subject of this part ...
Asset Allocation Classes
2007-12-13 11:40:00 There are three distinct classes of asset allocation. Namely; 1. Long term asset allocation 2. Active asset allocation 3. Portfolio insurance The objective of portfolio insurance being to protect against unacceptable portfolio performance or adverse market action. A further exposition for a better understanding maybe read at: Visit: http://www.narachinvestment.com-/asset_allocation_classes.htm (You may click on the link above or ...
Asset Allocation update: 2007 December
2007-12-13 05:01:00 There are two common ways to re-balance an investment portfolio: either do it annually, or do it whenever the allocation of an asset type is off by more than a certain percentage.In my case, since I am very much in the accumulation phase of my investments, I don't strictly do either of the above. What I have been doing for the last few years is to determine my allocations at the beginning of December, and use a simple spreadsheet to calculate our planned contributions for the following year. This is also a good time to make any tweaks to the target asset allocation for the next year. I also sometimes fine-tune the contributions during the year, but generally try to stick to the plan through the year.I have given below my target allocations (as planned in December 2006) and my actual allocations, as of December 1, 2007. I include only our retirement and brokerage accounts in the allocation above. This is money that we don't expect to use within the next 10-15 years. I have exclud...
By: Retire To India
Asset Allocation - Your Most Important Investment Decision
2007-12-07 07:46:00 Two known facts about financial markets are 1) They’re unpredictable - the movements of markets has been likened to a drunkard’s attempts to find his way home (random walk theory), and 2) They’re volatile - in The (Mis)Behavior of Markets Benoit Mandelbrot suggests markets are much more volatile than generally acknowledged by standard financial theories. The corollary ...
Asset Allocation: It May Be Time to Rebalance Your Portfolio
2007-08-15 22:21:00 Raise your hand if you think the stock market has been a little volatile lately. It has been a crazy couple of weeks watching the DOW drop by triple digits, bounce back a couple of hundred points in a glimmer of hope, and then drop by several hundred more points the next day. Many investors have found a new friend in anxiety medication. If you have any stock exposure in your portfolio, you’ve probably shared in their pain. However, many investors may be feeling this pain more than they need to. If you have any exposure to stocks in your portfolio (especially international stocks), you have probably enjoyed a healthy return for the past two or three years. These gains have likely caused stocks to become a more disproportionate part of your portfolio than you had originally anticipated. Thus, during this downturn, you are being negatively affected on a disproportionate portion of your portfolio. This is where asset allocation comes into play. Asset allocation is the redis...
Asset Allocation: June 2007
2007-06-21 09:30:00 There has been a lot of talk of Asset Allocation around the blog world so I thought I’d join in. Based on my current portfolio, here is my asset mix of my investments (not including savings and pension): Total Portfolio: $184,773 (obtained from my May Net Worth Statement) Cash: $32,000 (17.3%) Bonds: $3,870 (2.1%) Equities: $59,080 (32%) Real Estate ...
Asset Allocation I
2007-06-04 13:30:00 There are many different views and beliefs on the ideal asset allocation. What I?m going to attempt to do is simply state what I believe is the best asset allocation for my unique situation. Your personal allocation may be the same however, it will probably be different based on your own unique investment objectives, time frame and risk tolerance.I?m going to deal with 2 elements of asset allocation: 1. Allocation amongst the asset classes2. Allocation amongst countries (currencies)I?ll begin with asset allocation amongst the classes. The most common rule of thumb is that ideally you should subtract your age from 100 and that is the maximum percent of your portfolio that should be in equities, with the remainder of your portfolio being in some form of fixed income (basically your age is the percent of your portfolio that should be in fixed income). So according to this rule I should be 27% invested in fixed income. For some this may be true, however in my personal situation I would...
Who?s Benefiting From Your Asset Allocation?
2007-05-15 17:41:00 Canadian Capitalist is graciously hosting the third Canadian Tour of Personal Finance Blogs. There is no way I am passing up this opportunity to be mentioned in his blog. This will be my second participation to this tour. Enjoy! Organizing your portfolio into neatly divided asset classes appears to be the sensible thing to ...
By: Financial Jungle
March 2007 Score Card ? Part II: Asset Allocation
2007-04-03 16:43:00 Two months ago, I took a look at the asset allocation of my taxable mutual fund investment. A result of that review was the decision to sell on of the large-cap holdings, CSVFX, as I found my investments didn’t have enough exposure in the mid- and small-cap categories. CSVFX was unloaded in February and part ...
Mutual Fund Basics: Asset Allocation Funds and Balanced Funds
2007-03-25 20:58:00 I am starting an irregular Mutual Fund Basics series where I will discuss some basic concepts in mutual fund investing. Though I have a larger portion of my taxable investments in stocks than mutual funds, I feel I know mutual funds better than stocks (and yes, I am still learning). Actually, I already have a ...
Model Portfolios Built with ETFs (III) - All About Asset Allocation
2007-03-13 18:43:00 This is the first segment of the Model Portfolios Built with ETFs series. In the first two parts, I discussed two model portfolios, the Couch Potato Portfolio and the Bogel Head Portfolio, and considered possible choices to build these portfolios with ETFs instead of transitional mutual funds. In this part, I continue the discussion with ...
How to Keep More ? The Tax Factor in Your Asset Allocation
2006-12-22 05:01:01 Thinking about asset allocation, what comes to my mind is the distribution of different asset classes in my portfolio: large-cap, small-cap, mid-cap, bonds, real estate, commodity, international, ect. There's hardly any doubt about the importance of asset allocation in investing. However, there's one more factor that we may have omitted so far: the taxes. When I use such tools as Morningstar's Instant X-ray to check the asset allocation of my mutual funds, what I use are the market value of each fund and the tool will take the face values to determine the percentage of each asset class across the entire portfolio. Nothing else is considered. Now, assume that I have a very simple portfolio with only stocks and bonds and my target allocation is 70% in stocks and 30% in bonds. And at this time of the year, I already had about 10% of gains in stocks due to dividend/capital gain payouts that are reinvested. If I X-rays my portfolio and it tells me I have the exact allocation...
Asset Allocation: Investing by the Numbers
1969-12-31 19:00:00 Uno. Asset Allocation is an investment planning tool, not an investment strategy… few investment professionals understand the distinction. Investment strategies are used to implement the asset allocation formula that investment planning produces. Many investors incorrectly believe that investment planning and financial planning are one and the same. Financial planning is the broader concept, one that ...
Getting Started, Building A Share Portfolio: The Asset Allocation Model App
1969-12-31 19:00:00 Its a topic we have talked about last January (Getting the right mix) when we showed you some typical asset allocation approaches, but here we take you a bit further, by mapping out the role different types of investments can play. Before starting to invest you will already have considered whether paying-off or reducing debts ...
Beginner’s Guide to Asset Allocation
1969-12-31 19:00:00 One of the primary goals of asset allocation is to balance risk and reward from the overall investment choices. Determining overall risk and reward is extremely important when it comes to the planned time line of your investment. For example, if you are a 25 year old, you want to choose assets that ...
Asset Allocation for Beginners
1969-12-31 19:00:00 One of the primary goals of asset allocation is to balance risk and reward from the overall investment choices. Determining overall risk and reward is extremely important when it comes to the planned time line of your investment. For example, if you are a 25 year old, you want to choose assets that ...
Asset Allocation for Beginners
0000-00-00 00:00:00 Asset Allocation explained in easy to understand language.
By: eArticle Submit
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