Asset Allocation
How would the asset allocation differ between a 25 year-old who is saving for retirement and a 67 year-old who is beginning retirement?
Be sure to provide the following:
- Give a reasonable stock-to-bond ratio for each investor.
- Explain your allocation.
Focus your discussion on the following:
- Asset allocation
- Time horizon
- Ability to assume risk
- Earning capacity
- Income needs
Answer Preview
The asset allocation between a 25-year-old investor who is saving for a retirement would be different from a 67-year-old investor who is beginning retirement. Asset allocation is a strategy of investment whereby an investor aims at balancing the rewards and the risk through the adjustment of the percentage invested in the portfolio’s asset with respect to the investor’s risk…
(689 Words)