Asset allocation refers to
A)choosing which securities to hold based on their valuation.
B)investing only in "safe" securities.
C)the allocation of assets into broad asset classes.
D)bottom-up analysis.

Question

Quizplus · Accepted Answer

Asset allocation is the process of dividing an investment portfolio among different asset categories such as stocks, bonds, real estate, and cash. The purpose of asset allocation is to diversify the investments and manage risk by spreading the money across different asset classes instead of putting them all in one type of investment. Therefore, option C is the correct answer. Option A refers to security selection, option B is too limited, and option D refers to a specific investment analysis technique.

Asset Allocation Refers to