Asset allocation is important, since it determines the level of risk of an overall portfolio. It is known that it is for good, when all of your portfolio's assets are not concentrated in one area, but are spread out among diverse investment categories. The three major asset categories to diversify your portfolio are stocks, bonds and cash. Numerous subcategories, entering those classes, would take much more than one article to become acquainted with them.
Asset allocation account may fit your portfolio if you are looking for an all-in-one investment that offers varying mixes of stocks, bonds and money market securities. Investments in asset allocation funds are usually less risky than investments in a fund that chooses only stocks or bonds. A diversified portfolio historically produces better returns, since different asset classes often experience highs and lows at different times, promising you a constant source of profit, although the one of the spheres you invest is temporarily non-favorable.
What are these usual services the professional investment management can provide you with? First of all, the team of professionals will support you with useful information about an investment expertise and a personal service, once reserved for the wealthiest investors. Your modest investment in the team of professional investment management is most likely to promise you higher returns in every sphere you choose. What you obtain as a bonus is the status of a well-informed person with in-depth information/reporting and a comprehensive investment strategy report and a personal asset allocation model.
You will definitely enjoy the ongoing support with your asset allocation account. It will keep you on track towards your goals and will be suggested by any professional investment management. Being afraid to repeat the said above, you should still resume the information and add a bit of new. Thus, which are the functions your financial adviser should fulfill? These are the following:
- Starting from the very beginning, your financial advisor will help you complete a personal investor profile and analyze your current portfolio;
- You will receive a personalized investment strategy report, including an asset allocation model, tailored to your individual goals;
- You will be explained your target asset mix and will have help when selecting the right portfolio for your goals;
- Your portfolio, in the most cases, is automatically rebalanced to maintain your target asset mix;
- If you need help in adjusting your asset allocation account as your goals change, you will have it; the up-to-date information on a broad range of financial matters like retirement, estate and tax planning is always available for your attention from your financial advisor.
- Regular account statements for any month with activity, your account online, detailed quarterly and annual performance reports - all this will keep you informed about the progress of your investment. Year-end tax reports simplify your tax filing and a competent organization will even help you reduce taxes.
Asset allocation account, fulfilled by the professional investment management, seems to be the most appropriate for the goals of any investor. This is a universal way to meet financial goals with minimum risk and strain from your side. Those two, working in a team, provide you with a perfect combination of a safe investment strategy. It sounds pleasant to have risky business without serious possibilities of risk.