How can asset allocation help you?

May 20 15:52 2021 QuantumMF Print This Article

While investing is important but knowing where to invest is very important. Never put all your eggs in one basket and always diversify your investments based on our goals.

It may not be very complicated to determine your financial goal/s – a comfortable retirement,Guest Posting children’s higher education, a new house or a new car, but developing an appropriate asset allocation plan intended to achieve those goals can be. Using online tools like asset allocator can prove to be valuable to reduce volatility and enhance diversification.

While all investments involve risks, including a possible loss of principal, the risk gets proportionally mitigated when allocated prudently. Typically, the greater the potential of the investment, the more the risk involved. Investors should be comfortable with market fluctuations, especially over the short term. Equity investments fluctuate, due to general market conditions. Bond prices generally move inversely to their interest rates. What determines success in long-term investing has been asset allocation. Asset allocation is investing your money in different categories of assets - typically equity, debt and gold, so your investments are well diversified.

The goal of devising a suitable asset allocation plan is to develop a robust investment portfolio that will help you reach your financial objectives in tandem with the risk you find comfortable with. A well-diversified plan may be one of the most effective ways to realize your long-term goals over time.

How can asset allocation help you?

  1. Reduce risk:

Diversifying your portfolio helps spread the investment risk across many different asset classes.

 

  1. Opportunity to earn long term risk adjusted returns:

Diversifying your investment portfolio helps you improve your chances of participating in market gains and mitigate the impact of poorly performing asset classes on your overall portfolio returns.

 

  1. Stay focused on your goals:

Diversifying your investments help reduce the urge to time the market and safeguard against market ups and downs.

Thus, asset allocation helps you in improving your chances to earn better long term risk adjusted returns.

Disclaimer: The views expressed here in this Article / Video are for general information and reading purpose only and do not constitute any guidelines and recommendations on any course of action to be followed by the reader. Quantum AMC / Quantum Mutual Fund is not guaranteeing / offering / communicating any indicative yield on investments made in the scheme(s). The views are not meant to serve as a professional guide / investment advice / intended to be an offer or solicitation for the purchase or sale of any financial product or instrument or mutual fund units for the reader. The Article / Video has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Whilst no action has been solicited based upon the information provided herein, due care has been taken to ensure that the facts are accurate and views given are fair and reasonable as on date. Readers of the Article / Video should rely on information/data arising out of their own investigations and advised to seek independent professional advice and arrive at an informed decision before making any investments. None of the Quantum Advisors, Quantum AMC, Quantum Trustee or Quantum Mutual Fund, their Affiliates or Representative shall be liable for any direct, indirect, special, incidental, consequential, punitive or exemplary losses or damages including lost profits arising in any way on account of any action taken basis the data / information / views provided in the Article / video.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

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QuantumMF
QuantumMF

Quantum Mutual Fund has over 14 years of experience into mutual funds and puts the needs of investors like you first. Invest in different types of schemes & start an SIP with Quantum Mutual Funds today!


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