All investments involve some sort of risk, whether it’s market risk, interest risk, inflation risk liquidity risk, tax risk. By crafting an individualized asset allocation strategy, we can help you mitigate the risks of any one asset class though diversification and balance.
Customizing your strategy
Each individual’s strategy is built on the careful consideration of the key elements of their financial profile:
- Investment Objectives: Goals to improve current lifestyle; achieve capital growth; fund a specific goal, such as a college education
- Risk Tolerance: How comfortable you are with market fluctuations that can result in losses. Inflation risk and interest risk need to be considered as well
- Investment Preferences: You might prefer one asset class over another based on a certain bias or interest towards the characteristics of that class
- Time Horizon: How long you are willing to commit to achieving your objectives
- Taxation: The varying tax consequences associated with a mix of asset classes
The importance of adapting to change
About the only certainty when it comes to the financial markets is that they will change, and so will your financial situation, preferences, priorities and risk tolerance.
Asset allocation, which is driven by complex mathematical models, should not be confused with the much simpler concept of diversification. That’s why a sound asset allocation strategy includes periodic reviews.
Learn more about asset allocation by contacting us today.