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What do we mean by ASSET ALLOCATION and why is it important?

Broadly speaking there are four main asset classes into which you can invest: cash, bonds, equities and property.  There are also many subdivisions within each class.

With literally thousands of different funds ranging across all the major asset classes to choose from, picking the right investments can confuse even the most seasoned investor. Deciding on this mix of equities, bonds, cash and property is referred to as asset allocation.

The consensus among most financial experts is that asset allocation is one of the most important decisions that investors make. In other words, your selection of individual funds is secondary to the way you allocate your assets to equities, bonds, property and cash.

Each of the asset classes has a different risk and return profile and a key aspect of the Pure Financial Consulting process involves our working with you to establish the ideal balance of your portfolio.