Perhaps a compromise could be a solution where you reduce down to your retirement allocation with half the assets and retain the higher allocation with the other half.
Allocation of assets to distressed debt will remain essentially unchanged from 2010, with distressed allocations exceeding 40% of assets under management for 27% of those surveyed.
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Is it appropriate to have the same allocation to risky assets when you are 30 as when you are 70?
Mr. Murray of Horizon Advisors advises clients who use margin to adjust the allocation of their other assets accordingly.
These funds establish a broad allocation to a wide range of assets that include stocks and bonds (both domestic and international), commodities, real estate and other investments.
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The rationale for the high allocation is that you need your assets to grow, and at a rate that preserves your ability to purchase goods and services.
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The euphoria many endowments have had for private equity resulted in the average endowment, pre-crisis, allocating 11.8% of assets to private equity, above the average allocation for all types of institutional investors, which stands at 8.8% today.
That's because employees are still letting stock allocations rise and fall with the market, rather than making a considered judgment about the proper allocation (given their age, assets and risk tolerance) between stocks and bonds and rebalancing accordingly.
This banknote liability arises largely because the bulk of the euro currency circulating outside the eurozone is sourced from, and paid for in, Germany, meaning that the Bundesbank holds a much greater share of refinancing loan assets backing the euro banknote circulation than its statutory allocation.
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It causes an allocation of more capital into non-productive assets such as gold, collectibles, land, etc.
From a portfolio allocation standpoint, put a small portion of your assets into this new space where you hope for both catalytic social change and positive financial results.
The macro, or asset-allocation, approach is to place bets on broad categories of assets, such as German bonds or emerging-market stocks.
Investors will want to be overweight below-market beta allocation, meaning investors will continue to move out of risk assets and into high end investment grade, defensive sectors like utilities and overall net long safety versus risk assets.
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Moreover, as Liz Davidson, a financial planner and founder of workplace financial education firm Financial Finesse points out here, the appropriate asset allocation for any individual worker will vary depending on what other assets he or she has outside of a 401(k) and his or her tolerance of risk.
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American mutual funds have gradually increased their overseas allocation of equities since 2003 from 15% to 22.5% of assets, says Mr Jen.
Once your asset allocation is set, your next goal should be to buy and hold onto your assets as cheaply as possible.
The similarly sized Abu Dhabi Investment Authority has been cutting its equity allocation to the lower end of its target band of 40-55% of assets, and giving more to index-trackers and less to expensive active managers.
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In a down market, the 40% allocation to bonds could support distributions for ten years before any volatile risky (equity) assets would need to be liquidated.
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The bank argues that its emphasis on asset allocation need not provoke a backlash from fat cats: future economic growth will create plenty of new assets to spread around.
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