Asset Mix

Asset Mix
The classification of all assets within a fund or portfolio. Assets are assigned to one of the core asset classes: stocks (equities), bonds (fixed income), cash and real estate. Other categories that are sometimes considered asset classes are commodities, international investments, hedge funds and limited partnership interests.

The asset mix is usually shown as the set of percentages every asset class contributes to the total market value of the portfolio. It is a key determinant of the risk/reward profile of the fund, which in turn is largely determinant of long-term performance results.

Investors can expect the asset mixes of funds within a given strategy – such as capital-appreciation funds, “balanced” funds, income funds and life-cycle funds – to be similar to each other.

Portfolio managers use the historical averages for different asset classes’ returns to determine the right mix of asset classes for the fund, whether the right mix is to hold a very high percentage of bonds (income-seeking investors, retirees) or to invest primarily in small-cap equities (capital-appreciation/aggressive-growth funds).

This applies to individual investors as well – the right asset mix will depend on the unique circumstances of the investor, including risk tolerance, desire for income, time horizon, tax liabilities and liquidity needs.


Investment dictionary. . 2012.

Игры ⚽ Поможем написать реферат

Look at other dictionaries:

  • asset mix — ➔ mix * * * asset mix UK US noun [C, usually singular] ► FINANCE INVESTMENT MIX(Cf. ↑investment mix): »We may make adjustments to the overall asset mix of the investment portfolio …   Financial and business terms

  • mix — [mɪks] noun [countable usually singular] a group of different things combined together for a particular purpose: • If the investment manager picks the right mix of bonds, his total return should rise quickly. ˈasset ˌmix FINANCE a mix of… …   Financial and business terms

  • Asset-backed commercial paper — (ABCP) is a form of commercial paper that is collateralised by other financial assets. ABCPs are typically short term investments that mature between 90 and 180 days and are typically issued by a bank or other financial institution. They are… …   Wikipedia

  • Asset Allocation Fund — A mutual fund that provides investors with a portfolio of a fixed or variable mix of the three main asset classes stocks, bonds and cash equivalents in a variety of securities. Some asset allocation funds maintain a specific proportion of asset… …   Investment dictionary

  • Asset Class — A group of securities that exhibit similar characteristics, behave similarly in the marketplace, and are subject to the same laws and regulations. The three main asset classes are equities (stocks), fixed income (bonds) and cash equivalents… …   Investment dictionary

  • Dynamic Asset Allocation — A portfolio management strategy that involves rebalancing a portfolio so as to bring the asset mix back to its long term target. Such rebalancing would generally involve reducing positions in the best performing asset class, while adding to… …   Investment dictionary

  • Tactical Asset Allocation — ( TAA) portfolio strategy that allows active departures from the normal asset mix according to specified objective measures of value. Often called active management. It involves forecasting asset returns, volatilities ( volatility), and… …   Financial and business terms

  • Cyclical tactical asset allocation — Stock price and bond yield movements are connected to changes in the economic environment. The cyclical approach to Tactical asset allocation involves monitoring economic environment for patterns that have historically led to trends in stock… …   Wikipedia

  • investment mix — ➔ mix * * * investment mix UK US noun [C, usually singular] (also asset mix, portfolio mix) ► FINANCE a combination of different types of investments that are chosen by comparing the possible risks and advantages of each type: »If you don t pay… …   Financial and business terms

  • Dynamic asset allocation — An asset allocation strategy in which the asset mix is mechanistically shifted in response to changing market conditions, as in a portfolio insurance strategy, for example. The New York Times Financial Glossary …   Financial and business terms

Share the article and excerpts

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