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Asset allocation explained.

The way a portfolio is divided among categories such as equities, bonds, and cash. A suitable mix depends on circumstances, objectives, horizon, and tolerance for uncertainty.

Planning

Asset allocation

The way a portfolio is divided among categories such as equities, bonds, and cash. A suitable mix depends on circumstances, objectives, horizon, and tolerance for uncertainty.

Example: An illustrative mix assigns a different role to each of three asset categories.

Watch for: Treating a sample percentage mix as a universal recommendation.

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