Asset allocation is the:
A)selection of specific securities within a particular class or industry.
B)division of a purchase price between a cash payment and a margin loan.
C)division of a portfolio into short and long positions.
D)distribution of investment funds among various broad asset classes.
E)dividing of assets into those that are hypothecated and those that are not.

Question

Quizplus · Accepted Answer

Asset allocation is the distribution of investment funds among various broad asset classes. This includes allocating funds to stocks, bonds, and cash equivalents, with the goal of achieving a balance between risk and return. It is not the selection of specific securities within a particular class or industry (A), the division of a purchase price (B), the division of a portfolio into short and long positions (C), or the dividing of assets based on whether they are hypothecated or not (E).

Asset Allocation Is The