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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Investor2 who wrote (47822)	5/5/2012 3:38:02 PM
From: Paul Senior	1 Recommendation Read Replies (2) \| Respond to of 78741

Whose asset allocation model is that, I2? For me, I'm in no individual bonds, I'm in about 3-4% bond funds and I have about 6-7% in net cash (which is the largest amount of cash I've held in maybe 20 or more years). I'm 89-91% in individual stocks including a small exposure to stock (equity) funds. Where might you be vs. that model, given that you are a senior also? Asset allocation seems to me to be such an individual thing depending on one's goals, one's risk tolerance and the changing relationship between bonds (bond yields) and stocks, that a general model not only doesn't work, but it doesn't really give a general indication of where one "should" be in life.

To: Investor2 who wrote (47822)	5/7/2012 10:42:57 AM
From: Dan Meleney	1 Recommendation Read Replies (2) \| Respond to of 78741

Asset Allocation - the formulaic age dependent ratio approach ignores specific situations. For example, if you don't need to draw down balances, more equities may be in order even for someone over 80. If you need to pay huge tuitions soon, more bonds might be better for a few years even if you're just 50. If I knew I had just X more years to live, I'd have more bonds as I closed in on that date, but my crystal ball is lacking such insight. With 3 grandparents reaching 94+, I doubt I'll be anywhere near 20%bonds at age 80. Another formula you might noodle over is: 1 or 2 years' expenses cash, the rest equities.