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Investment term of the day: asset allocation

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Asset allocation is the act of deciding which categories of assets the investable amount should be invested in and what proportion should be in each category.

By allocating assets properly and in a balanced way, investors can reduce risk and increase opportunities and returns. Investors should distribute their assets over the three main asset classes – equities, fixed income, and cash and equivalents – in a way that reflects their goals and investment timeframe.

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