Asset Allocation and Achieving Balance
Asset allocation is the process of determining the mix of stocks, bonds and other classes of investable assets to match the investor's risk capacity, which includes attitude towards risk, net income, net worth, knowledge about investing concepts, and time horizon. Index funds capture asset classes in a low cost and tax efficient manner and are used to design balanced portfolios.
A combination of various index mutual funds or ETFs could be used to implement a full range of investment policies from low risk to high risk.
Read more about this topic: Index Fund
Famous quotes containing the words asset, achieving and/or balance:
“When ... did the word “temperament” come into fashion with us?... whatever it stands for, it long since became a great social asset for women, and a great social excuse for men. Perhaps it came in when we discovered that artists were human beings.”
—Katharine Fullerton Gerould (1879–1944)
“Like many businessmen of genius he learned that free competition was wasteful, monopoly efficient. And so he simply set about achieving that efficient monopoly.”
—Mario Puzo (b. 1920)
“It has been the struggle between privileged men who have managed to get hold of the levers of power and the people in general with their vague and changing aspirations for equality, for justice, for some kind of gentler brotherhood and peace, which has kept that balance of forces we call our system of government in equilibrium.”
—John Dos Passos (1896–1970)