Asset allocation strategy — sounds a little tricky to most investors, when really it is quite simple. Think of it as your total investment portfolio divided into a mix of different types of assets and asset classes reflecting your investment goals and risk tolerance. One of the keys to a successful mix is to hold assets that historically do not all move in the same direction either up or down at the same time, thereby “balancing” your portfolio. Ideally, when some assets are in a decline, others are performing well, mitigating your losses.
Some asset allocation strategies take a weighting approach that requires you to continually rebalance your portfolio. In this scenario, you would buy more of an asset declining in value, and sell an asset that is increasing beyond a previously determined percent of return or loss. Obviously in this scenario, timing is important and “rebalancing” is continuously required to maintain an ideal mix, bringing us to the subject of gold. Continue reading our market analysis