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The Ideal Asset Allocation

The Ideal Asset Allocation

Season 7 Episode 354 Published 1 year, 2 months ago
Description

On today's show we're talking about asset allocation. The inspiration for today's show came from the dramatic volatility in the stock market that we've experienced over the last few days. This is nothing new of course. I was in my early 20s and managing my family's assets when black Monday happened in October of 1987. That lesson has repeated itself a few times since then. When I was in the tech industry I had a very large percentage of my assets tied up in shares of technology companies through the 1990s until the balloon burst in the year 2000.

I believe that all investors should be dividing their assets into one of four buckets and doing so consciously.

All investors should divide their portfolio into

1.        a safety bucket

2.       A cash flow bucket

3.        A growth bucket

4.       A more speculative risk bucket

Nothing controversial so far. This is all motherhood and apple pie. The big challenge for many investors is to determine which category to place any of their investments.

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