Genuine Diversification: Getting Beyond Two Asset Classes
Jul 23, 2009
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By Craig L. Israelsen, PhD
Many advisors rely on the traditional 60/40 stock/bond portfolio for a diversified core holding. However, the two-asset-class model doesn't go far enough. A truly diversified portfolio or core will include at least seven asset classes and will be better able to weather market downturns while improving risk-adjusted return.