Written by:
Image
Paul Tracy

Paul has been a respected figure in the financial markets for more than two decades.

Prior to starting InvestingAnswers, Paul founded and managed one of the most influential investment research firms in America, with more than 2 million monthly readers. While there, Paul authored and edited thousands of financial research briefs, was published on Nasdaq. com, Yahoo Finance, and dozens of other prominent media outlets, and appeared as a guest expert at prominent radio shows and i...

View all posts
Updated January 16, 2021

What is Strategic Asset Allocation?

Strategic asset allocation is the practice of realigning a portfolio's asset composition in order to accommodate changes in market climate.

How Does Strategic Asset Allocation Work?

Portfolios are made up of different asset classes, with each asset class comprising a certain percentage of the total portfolio (i.e. asset allocation). Asset classes react differently to changes in the economic and market outlook. Strategic asset allocation involves changing these percentage allocations in response to expected shifts in the market. For example, if analysts foresee an imminent upswing in the equity markets, an investor may want to increase the percentage of her portfolio allocated to stocks

Why Does Strategic Asset Allocation Matter?

By employing strategic asset allocation, investors and investment managers are able to make adjustments intended to reduce the risk of loss and/or increase potential for reward in advance of a forecasted shift in market trends.

Ask an Expert about Strategic Asset Allocation
At InvestingAnswers, all of our content is verified for accuracy by Paul Tracy and our team of certified financial experts. We pride ourselves on quality, research, and transparency, and we value your feedback. Below you'll find answers to some of the most common reader questions about Strategic Asset Allocation.
Be the first to ask a question

If you have a question about Strategic Asset Allocation, then please ask Paul.

Ask a question

Paul has been a respected figure in the financial markets for more than two decades. Prior to starting InvestingAnswers, Paul founded and managed one of the most influential investment research firms in America, with more than 2 million monthly readers.

If you have a question about Strategic Asset Allocation, then please ask Paul.

Ask a question Read more from Paul

Read this next

Paul Tracy - profile
Ask an Expert about Strategic Asset Allocation

By submitting this form you agree with our Privacy Policy

Share
close
Don't Know a Financial Term?
Search our library of 4,000+ terms