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Tue, February 4, 2025
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How asset allocation helps you balance risk and returns


Published on 2025-02-04 05:01:16 - cnbctv18
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  • Traditional investments like FDs and RDs offer stable returns but often fail to keep up with inflation, eroding real wealth. Diversifying across asset classes helps counter this issue.

The article from CNBC TV18 discusses the importance of asset allocation in investment portfolios, emphasizing that it's not just about choosing the right assets but also about balancing them effectively to manage risk and optimize returns. It highlights the traditional approach of diversifying investments across equity, debt, and gold, but also introduces the concept of fixed and recurring returns as part of a modern investment strategy. The piece explains how asset allocation should be tailored to an individual's risk tolerance, investment horizon, and financial goals. It notes that while equities offer high growth potential, they come with increased volatility, whereas debt instruments provide stability and regular income. Gold is recommended as a hedge against inflation and market volatility. The article also touches upon the benefits of fixed returns from instruments like fixed deposits and the potential of recurring investments through systematic investment plans (SIPs) in mutual funds, which can help in rupee cost averaging. Overall, the article advocates for a dynamic asset allocation strategy that evolves with market conditions and personal circumstances to achieve long-term financial stability and growth.

Read the Full cnbctv18 Article at:
[ https://www.cnbctv18.com/personal-finance/asset-allocation-investments-equity-debt-gold-fixed-recurring-returns-19552305.htm ]