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Risk Management

Asset Allocation


Asset Allocation: Could It Really Be That Simple?

Now we'll discuss how rebalancing also keeps your portfolio in line with your target allocation (which should be based upon your risk tolerance and goals). Consider the case of two investors, Bruce and Mike, who owned the same stock and bond funds in tax-deferred accounts back in early 1997. Both are the same age, have the same goals, share the same risk tolerance and have their desired 60%-40% split between stocks and bonds, respectively. Emboldened by the stock market's heady gains,... more

Investment Risk


How to Plan for Risk in Your Portfolio by Knowing Your Tolerance and Capacity

Summary: Tolerance and capacity are two ingredients of risk when it comes to investments and retirement planning. We look at what they are, and what kind of critical impacts they can create when planning for your golden years.   When we think about recipes for well-funded retirement plans we often start with some basic concepts. One of them is that investments are at the root of preparing for our post-work years. Packed into our investment portfolios, however, is a separate... more