Which of the Following Refers to an Approach Where You Assign Different Percentages to Investments in One Portfolio?
Asset Allocation involves assigning varied percentages to investments within a portfolio, enabling effective risk management and maximizing returns by diversifying across different asset classes.
by Sai V
Published Oct 30, 2023 | Updated Oct 30, 2023 | ๐ 1 min read
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Which of the Following Refers to an Approach Where You Assign Different Percentages to Investments in One Portfolio?
A) Portfolio Maximization
B) Asset Allocation
C) Bonds
D) Portfolio Diversification
The correct answer is B) Asset Allocation
Asset allocation (option B) refers to the approach of assigning different percentages to investments in one portfolio. By spreading investments across various asset classes based on financial goals and risk tolerance, investors can effectively manage risk and optimize returns, making it the correct choice among the options provided.
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