Sunday, 12 November 2017

Money Management plus Method - I

My general guide for assets allocation in equity relative to STI:

ST index Tier% Equity holding %
above 3600 90 <10 td="">
3400 85 15
3200 80 20
3000 75 25
2800 70 30
2600 60 40
2400 50 50
2200 40 60
2000 30 70
1800 20 80
below1600 10

(We can use in conjunction with TA rather than blindly catching falling knife.)

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Methods of Asset Allocation:

  1. Strategic asset allocation calls for setting target allocations and then periodically rebalancing the portfolio back to those targets as investment returns skew the original asset allocation percentages. The concept is akin to a "buy and hold" strategy, rather than an active trading approach.
  2. Tactical asset allocation (TAA) is a dynamic investment strategy that actively adjusts a portfolio's asset allocation. The goal of a TAA strategy is to improve the risk-adjusted returns of passive management investing. 
There are more, if you are interested... read more here https://www.investopedia.com/articles/stocks/07/allocate_assets.asp
or get your hands on 'The little book that saves your assets' by David M. Darst.

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