The first major step in asset allocation is
A) assessing risk tolerance.
B) analyzing financial statements.
C) estimating security betas.
D) identifying market anomalies.

Question

Quizplus · Accepted Answer

Assessing risk tolerance is the first major step in asset allocation because it helps in determining how much risk an investor is willing and able to take, which in turn guides the selection of investments that match their risk profile.

The First Major Step in Asset Allocation Is