Asset allocation is vital for success from "summary" of All About Index Funds by Richard A. Ferri
Asset allocation is the most important decision an investor can make. It determines the risk and return of a portfolio more than any other factor. The key is to find the right mix of assets that align with your financial goals and risk tolerance. This involves spreading investments across different asset classes such as stocks, bonds, and cash equivalents. Diversification is a critical component of asset allocation. By spreading investments across various asset classes, you can reduce the overall risk of your portfolio. It helps to protect against market volatility and downturns in any particular sector. This way, you can achieve a more stable and consistent return over the long term. It's important to ...
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