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
E)all of the above

Question

Quizplus · Accepted Answer

Asset allocation refers to dividing investments across broad asset classes such as stocks, bonds, and cash, based on the investor's goals, risk tolerance, and time horizon, in order to achieve a diverse portfolio that can help mitigate risk and maximize returns over the long term. Therefore, option C is the best choice. Options A, B, and D are incorrect as they are not comprehensive definitions of asset allocation. Option E is incorrect as it includes options that are not relevant to asset allocation.

Asset Allocation Refers to ____________