Asset allocation, by spreading risk, helps financial advisers create a portfolio that best suits your tolerance for risk - and maintains that balance as your goals and life stages change. Diversification also allows you to take advantage of imbalances among markets. For example, the differences between the stock and bond markets and between domestic and foreign markets could create investment opportunities. Stocks are based on the Wilshire 5000 Index. Bonds are based on the Merrill Lynch Corporate Bond Index.
Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. This is where the value of a financial adviser's advice comes into play. For most investors, reducing or managing the risk in a portfolio so they can sleep at night is equally as important as increasing their return. This article is for general information only and is not intended to provide specific advice or recommendations for any individual. Consult us, your LPL financial advisor, or your attorney, accountant or tax advisor with regard to your individual situation.