Asset Allocation
Asset allocation is a strategy where an investor determines how to distribute their investments across different asset classes, such as stocks, bonds, and real estate, based on their risk tolerance, financial goals, and time horizon. The goal is to balance risk and reward by diversifying investments, helping to maximize returns while minimizing potential risks. This strategy allows investors to tailor their portfolio to their unique needs and preferences, aiming for optimal growth while managing volatility. Proper asset allocation is crucial for long-term financial success.
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