What is asset allocation?

Make no mistake; there are plenty of times in life when it’s best to spread your bets, have back-up plans and safety nets. It’s this approach – to not carry all your eggs in the same basket – that is behind what is known as Asset Allocation.

When we’re putting together your Wealthface portfolio, we have plenty of choices regarding where best to put your money. Different markets and ETFs behave in different ways – some feature higher levels of risk, others offer the chance of greater returns. We always compose every portfolio with our signature approach of maximizing returns and minimizing risk, and there are plenty of different ways we’re able to achieve that for our clients.

That’s where asset allocation comes in. This is an investment strategy that balances risk and reward, by carefully apportioning the assets in a portfolio according to the financial goals, risk tolerance levels, and investment horizons of a client. Here at Wealthface, we use sophisticated questionnaires and our Robo-advisor platform to help get a clear picture of what the goals and risk tolerances of our clients are. This information helps us diversify widely and spread our clients’ funds appropriately, according to their unique profile.

If you look around online, you’ll find all kinds of suggestions and advice regarding how best to allocate assets. However, we’d always advise our clients to put their faith in our professionalism and industry wisdom. Indeed, our combined use of investment experts and razor-sharp algorithms has the power to help us make the right choices for your time and time again. We know that every investor is different, and everyone has their own opinions regarding risks and returns. That’s why our approach is always tailored to the needs of the individual client and how we can ensure maximized returns for everyone’s level of risk tolerance.

What are the pros?

The advantages of spreading your investment around become clearer once you understand the risk of putting all of your eggs in one basket. Let’s say your friend is urging you to put your money into the stock of a new company they like the sound of. Now, on the one hand, this new company might perform brilliantly… but on the other, if it nosedives into obscurity, you could be set to make a huge loss. If that loss involves your kids’ college funds… well, let’s say family dinners might not be the same again. By taking advantage of well-spread asset allocation, you’re ensuring that you’ve invested in enough different things to be able to ride high on positive trends, and stay above the water should a negative one arise.

However, if you want to make the most of asset allocations, you would have to adjust and monitor your allocations as they – and you – grow and evolve. For example, young investors generally have a higher risk tolerance than their elders; they’re looking for maximized returns that can make a real difference. Older investors, on the other hand, might be more interested in steady incomes and stable investments for retirement.

No matter how old you are or what your background might be, Wealthface has a portfolio that’s going to match your personality and needs. Find your perfect fit with our state-of-the-art service and see where your money will take you.

Factors to bear in mind

It is well understood that putting together a well-diversified portfolio on your own is a tricky business and something which requires plenty of skill and foresight. Indeed, going alone can be a risky business. A bad investment could lead you to lose your savings and result in your deeply regretting your decision.

It doesn’t cost much to put your wealth in the hands of experts, professionals who can serve you, keep an eye on your investment and ensure your wealth being is maintained at its peak. This way, your wealth can grow before your eyes, and you’ll be free to focus on those things which fill your days with joy.

Wealthface can present to you an ideal portfolio for your goals at the click of a button. With cutting edge technology at your fingertips, and proven portfolios back-tested over the past ten years, why would you invest any other way?