Next video:
Loading the player...

Strategic asset allocation is a portfolio strategy that involves setting target allocations for various asset classes, then yearly rebalancing the portfolio to maintain these original allocations. Allocations can deviate due to differing returns from various assets. Balanced diversification can reduce risk and improve portfolio returns.

Strategic asset allocation is an investment strategy focused on the needs of the investor rather than the constant tracking of the markets, and is thought to remove the influence of emotion from investment strategies.

 

Related Articles
  1. Investing

    What Is Tactical Asset Allocation?

    Here's how tactical asset allocation, an extension of strategic asset allocation, works.
  2. Financial Advisor

    An Introduction to Asset Allocation

    A portfolio is only as strong as its asset allocation. To create the right one, investors need to determine their risk tolerance, time horizon and goals.
  3. Investing

    Why Asset Allocation Matters in Your Portfolio

    Asset allocation accounts for more than 90% of the investment process.
  4. Managing Wealth

    Choose Your Own Asset Allocation Adventure

    There are many strategies to help balance your portfolio. Here are a few to get you started.
  5. Financial Advisor

    Asset Allocation vs. Security Selection: The Main Differences

    Both are important to a long-term investment strategy, but asset allocation and security selection have different missions.
  6. Investing

    Types of rebalancing strategies

    Learn how portfolio rebalancing provides protection and discipline for any investment management strategy by retail or institutional investors.
  7. Tech

    How to Make a Solid Annual Rebalancing Plan

    An annual portfolio rebalancing plan can preserve your original asset allocation and reduce risk while improving overall return with less volatility.
  8. Investing

    Rebalance Your Portfolio to Stay on Track

    Like a tune-up for a car, this realignment should minimize trouble down the road. Learn how to use rebalance as a strategy to minimize your portfolio risk.
  9. Investing

    Does Portfolio Rebalancing Produce Better Returns?

    A look at how much impact rebalancing has on the performance of a portfolio.
Trading Center