3/18/2010

TIME FOR AN ASSET ALLOCATION REVOLUTION


Risk is a four-letter word nobody likes, and portfolio managers are no exception.
However, the emergence of several new asset allocation methods that move away from the fixed mix strategy gives cause to see risk in a new light. These risk-focused methods can lead to better portfolio choices and thereby provide better protection during market crashes.
Markets are in constant flux, risk-focused theorists assert, so asset mixes should shift periodically to maintain the portfolio’s exposure to risk, i.e. volatility level. A risk-based approach to asset allocation is an active style of management that breaks away from the traditional buy, hold and rebalance strategy. It adapts asset mixes to evolving market conditions and rebalances them back to the portfolio’s target risk level.


"Read the full article here":

http://www.advisor.ca/advisors/investments/marketinsights/article.jsp?content=20100226_161150_8700

Advisor.ca
Rayann Huang
February 01, 2010

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