Strategic asset allocation is a longterm approach based on investor goals from "summary" of All About Asset Allocation, Second Edition by Richard Ferri
Strategic asset allocation involves determining the right mix of asset classes for your investment portfolio based on your long-term objectives. This approach is not about trying to time the market or chase short-term trends, but rather about creating a plan that aligns with your financial goals and risk tolerance. By focusing on the big picture and sticking to your strategic allocation over time, you can potentially achieve better long-term results. Investors should first consider their investment goals, time horizon, and risk tolerance when developing a strategic asset allocation. For instance, if you have a long time horizon and can handle market fluctuations, you may be more comfortable with a higher allocation to stocks. On the other hand, if you have a shorter time horizon or lower risk tolerance, you may lean t...
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