Summary of Asset Allocation Mutual Funds

Asset allocation can be an ideal strategy for investors looking to diversify their holdings and avoid putting all their eggs into one basket. It is an investment philosophy in which stocks, bonds, and cash are combined to create a portfolio that can be either passively or actively managed. Asset allocation can be accomplished using a single-fund, multi-fund, or life-cycle fund approach, depending on the investor’s objectives. He or she should understand that there are costs and consequences associated with each. However, regardless of the method selected, asset allocation through mutual funds can provide investors with a solid foundation on which to build their future dreams.