How to implement asset allocation


How to Achieve Optimal Asset Allocation

The combination of residents' wealth management needs and asset allocation products can be achieved through four different types of products. First, low-risk products. Through asset allocation investment framework, stocks and bonds can be represented by a good combination of assets. There is a low-risk product that puts most bonds and a small amount of stocks into a portfolio, which can play the role of guaranteeing absolute returns. Second, low-risk positive products. Products that link asset allocation with resident wealth management are known as low-risk active products. Low-risk active products are effective combinations of stocks and bonds, which can maintain a certain degree of return elasticity when the market is in a bullish state; When the market is in a bear market, the product can effectively protect the portfolio principal to a certain extent, play a role in preventing risks, and provide the product with good assets with risk-return characteristics and income elasticity. Third, medium and high risk products. Medium and high risk products are stock-biased products, which will produce an interesting feature when effectively combined with asset allocation investment methods: in the medium and long investment cycle, the product can provide relatively stable long-term stock-biased returns; When the market has a significant correction, the product also has a relatively good grasp and maintenance of risk losses. That is, individual investors hold such products, and when the market risk is high, they suffer relatively little loss; In the medium and long investment cycle, it can get a neutral high return similar to the characteristics of equity assets.

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For individual investors, such products can enhance the holding experience and be more conducive to long-term holding. Number four. High risk and high yield products. Such products often have a high ratio of equity assets, which can help individual investors choose a strong industry or track in a long period of time. When the market is risky or in the process of structural switching, they can effectively grasp the structural adjustment of the market, which can not only show obvious explosive power in the short term, but also bring better investment returns in a long period of time. If ordinary investors do not want to bother with their own research and operations, they can choose asset allocation products provided by professional investors, such as public FOF (Fund of Funds) and MOM (Manager Of Managers).

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Conclusion: To do asset allocation, investors need to clarify the conditions and demands of the four aspects of investment amount, duration, risk and return, that is, how much capital needs to be allocated, how long these funds will participate in the investment, what is the maximum retreat and annual fluctuation they can accept, and what is the requirement for return, rather than thinking of one or two times of return as soon as they mention investment. After the above conditions are clear, further consider the specific configuration scheme. By allocating fund products with different strategies and different markets, stable excess returns can be obtained better. In wealth management, the system framework of asset allocation can increase returns and help investment, which is also an excellent embodiment of the effective combination of wealth management and asset allocation investment system. When professional asset allocation teams deeply integrate portfolio management and asset research into the process of portfolio investment through in-depth tracking and effective pursuit of sound returns, investors can track portfolio investment performance more deeply, which is more conducive to obtaining long-term and stable returns.