Asset Allocation: Our Investment Suitability Process
Asset Allocation is the mix between stocks and bonds in an investment portfolio. The determination of where each client falls along this continuum is a highly individual process. It reflects an evaluation of a client’s long term financial goals, including:
- need for current income and short-term liquidity
- return expectations and time horizon
- tax related issues when appropriate
- willingness and ability to withstand market volatility
Balancing Risk & Return
The Asset Allocation Experience: 1926-2023
The Asset Allocation Experience: 1926-2023
Compound
Worst Year's
Number of years with loss greater than
Portfolio
Return
Return
5%
10%
20%
100% Stocks
10.3%
-43.3%
20
12
6
80% Stocks / 20% Bonds
9.2%
-35.1%
19
8
3
60% Stocks / 40% Bonds
8.1%
-27.0%
10
6
2
40% Stocks / 60% Bonds
7.0%
-18.8%
6
3
0
20% Stocks / 80% Bonds
5.9%
-10.6%
3
1
0
100% Bonds
4.8%
-7.8%
1
0
0
Source: Ibbotson Associates, Ned Davis Research, and M. Kraus & Company. Stocks = S&P 500. Bonds = Intermediate Term U.S. Treasury Securities
This information is intended to be a representation of different allocations for historic returns and does not represent future returns. The information contained herein has been obtained from sources believed to be reliable, but the accuracy of the information cannot be guaranteed.
