Throughout investing circles, you hear about the importance of asset allocation and diversification. Asset allocation means to have a proper percentage of your invested assets spread throughout multiple investment classes (i.e. large company, small company, mid-size company, international, etc.). Diversification is very simply the old adage your grandmother used to tell you: Don’t put all your “eggs” in one basket!
I want to briefly discuss an often-overlooked aspect of investing, which is asset location. This is simply the idea of “putting the right stuff in the right bucket.” The stuff in this analogy is the different asset classes where you …Read More