Comments on: Asset Allocation: An Important Part of All Financial Plans http://genxfinance.com/asset-allocation-an-important-part-of-all-financial-plans/ Helping a unique generation achieve financial independence. Fri, 25 May 2012 01:44:43 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: Chris http://genxfinance.com/asset-allocation-an-important-part-of-all-financial-plans/comment-page-1/#comment-111449 Chris Wed, 18 Mar 2009 18:23:57 +0000 http://genxfinance.com/?p=1456#comment-111449 Funny how most people are buy-and-holders when times are good and traders when times are bad.. I don't think buy-and-hold is dead, though I do feel expected returns needs to be adjusted down. People need to realize that the brunt of their retirement is going to come from personal earnings and savings. Investment returns will likely be much less than the often touted 10-11%. Diversification needs to be revisited, as well. I don't believe modern portfolio theory and the efficient frontier are completely out the window, but we need to appreciate the fact that a bunch of different pieces of paper is still just that, pieces of paper. True diversification will come from owning real investment property and other alternative investments to complement a stock and bond portfolio. The only thing that's gone up in the past 18 months is correlation. JMHO Funny how most people are buy-and-holders when times are good and traders when times are bad.. I don’t think buy-and-hold is dead, though I do feel expected returns needs to be adjusted down. People need to realize that the brunt of their retirement is going to come from personal earnings and savings. Investment returns will likely be much less than the often touted 10-11%.

Diversification needs to be revisited, as well. I don’t believe modern portfolio theory and the efficient frontier are completely out the window, but we need to appreciate the fact that a bunch of different pieces of paper is still just that, pieces of paper. True diversification will come from owning real investment property and other alternative investments to complement a stock and bond portfolio. The only thing that’s gone up in the past 18 months is correlation. JMHO

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