Time Horizon

Time Horizon
The length of time over which an investment is made or held before it is liquidated. Time horizons can range from seconds, in the case of a day trader, all the way up to decades for a buy-and-hold investor. There is no "right" time frame - it depends on the investor's individual objectives.

Knowing your time horizon is extremely important when it comes to choosing the type of investments you want and your asset allocation. All things being equal, you can afford to be more aggressive with a longer time horizon. For example, most advisors would recommend that the asset allocation of a 30 year old be more heavily weighted in equities than that of someone who is close to retirement.

That said, age isn't the only determinant of time horizon. A 30 year old who is saving money for a down payment on a house in one year would be investing with a one-year time horizon, despite the fact that retirement is years away. Given the short time frame, it would be prudent to invest more conservatively because there is little time to make up any losses.


Investment dictionary. . 2012.

Игры ⚽ Нужен реферат?

Look at other dictionaries:

  • Time horizon — A time horizon, also known as a planning horizon, is a fixed point of time in the future at which point certain processes will be evaluated or assumed to end. It is necessary in an accounting, finance or risk management regime to assign such a… …   Wikipedia

  • time horizon — noun A fixed point of time in the future where certain processes will be evaluated or assumed to end. Syn: planning horizon …   Wiktionary

  • time horizon — The period, usually expressed in years, for which an investor expects to hold an investment. Bloomberg Financial Dictionary …   Financial and business terms

  • time horizon — /ˈtaɪm həraɪzən/ (say tuym huhruyzuhn) noun the point in the future when a particular event will take place towards which one makes plans …  

  • Time value of money — The time value of money is the value of money figuring in a given amount of interest earned over a given amount of time. The time value of money is the central concept in finance theory. For example, $100 of today s money invested for one year… …   Wikipedia

  • Time-bound programmes for the eradication of the worst forms of child labour — The International Labour Organization Worst Forms of Child Labour Convention (Convention No. 182) calls for time bound programmes for the eradication of the worst forms of child labour. Countries ratifying this Convention must take immediate and… …   Wikipedia

  • Horizon League — Established 1979 Association NCAA Division Divi …   Wikipedia

  • Horizon — Ho*ri zon, n. [F., fr. L. horizon, fr. Gr. ? (sc. ?) the bounding line, horizon, fr. ? to bound, fr. ? boundary, limit.] 1. The line which bounds that part of the earth s surface visible to a spectator from a given point; the apparent junction of …   The Collaborative International Dictionary of English

  • Horizon Weekly — is an Armenian Canadian newspaper publication and is the official political organ of Canada s Armenian Revolutionary Federation (ARF) Central Committee. History Canada s Horizon Armenian Weekly was first published in 1979, sharing its birthday… …   Wikipedia

  • Horizon (magazine) — Horizon: A Review of Literature and Art was an influential literary magazine published in London, between 1940 and 1949. It was edited by Cyril Connolly who gave a platform to a wide range of distinguished and emerging writers. Connolly founded… …   Wikipedia

Share the article and excerpts

Direct link
… Do a right-click on the link above
and select “Copy Link”