How Big Your Core Should Be
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How Big Your Core Should Be
Clearly, a fund that is a core holding for one investor may not be a core holding for another investor.
Things To Know
- There’s no rule on size.
The rules
Core holdings take up 100% of some portfolios. In others, these investments account for 70% to 80% of assets. There’s no rule for how large your core ought to be. But we suggest that core holdings take up at least two thirds of your portfolio. After all, you are relying on these solid, long-term investments to help you reach your goals.
Use noncore investments for diversification and growth potential. For instance, if your core is made up exclusively of large-cap stocks, you might want to add small-cap or international stocks to the noncore portion of your portfolio for diversification.
