The division of a portfolio's dollars among various types of assets is referred to as:
A) the minimum variance portfolio.
B) the efficient frontier.
C) correlation.
D) asset allocation.
E) setting the investment opportunities.

Question

Quizplus · Accepted Answer

Asset allocation is the process of dividing a portfolio's dollars among various types of assets, such as stocks, bonds, and cash equivalents. It is a crucial step in creating a well-diversified portfolio that matches an individual's investment goals, risk tolerance, and time horizon.

The Division of a Portfolio's Dollars Among Various Types of Assets