Asset allocation – A useful
Investment Strategy

When market volatility feels overwhelming, it can help to step back and look at your holdings as a whole and consider a portfolio that is broadly diversified across equities, fixed income and cash equivalents.

A disciplined mix of assets may help investors weather the short-term ups and downs of the markets and make progress toward their long-term goals. That’s because asset classes tend to respond to changing market conditions in different ways. Typically, when one area is underperforming, another area may be performing well.

Allocating a portfolio across asset classes, sectors, securities and countries may be one of the most important decisions that an investor makes. In fact, studies show that more than 90% of the variability of investment returns is due to the asset allocation of a portfolio.*

There is no shortage of causes for today’s volatility. That’s why we at BNY Mellon Investment Management have created a host of resources that offer a helpful perspective. We are a source you can trust for economic insights, market updates, and strategic guidance that is grounded in expertise, including:

  • Conversations with Liz Young: Listen to our weekly audio updates from Liz Young, Director of Market Strategy, to learn about current opportunities in global equities and fixed income.
  • Weekly Market Roundup: Read Alicia Levine’s weekly publication to stay informed about the major factors affecting the investment universe.
  • Featured Insights: Check in for timely content currently focusing on the upcoming election and potential market implications.
  • Election Hub 2020: View a collection of election-related investment insights from BNY Mellon Investment Management’s experts.

In order to combat market volatility, allocate your assets appropriately and arm yourself with the facts. We have the capabilities and support you need. Visit our website, or call us at 1-800-443-9794 to learn more.

* “Does Asset Allocation Policy Explain 40, 90, or 100 Percent of Performance?” by Roger G. Ibbotson and Paul D. Kaplan, printed in the Financial Analysts Journal, January/February 2000.

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Investors should consider the investment objectives, risks, charges and expenses of any mutual fund carefully before investing. Contact a financial professional or visit im.bnymellon.com to obtain a prospectus, or a summary prospectus, if available, that contains this and other information about the fund, and read it carefully before investing.

All investments involve some level of risk, including loss of principal. Certain investments have specific or unique risks. No investment strategy or risk management technique can guarantee returns or eliminate risk in any market environment.

Asset allocation and diversification cannot assure a profit or protect against loss. Equities are subject to market, market sector, market liquidity, issuer, and investment style risks to varying degree. Bonds are subject to interest rate, credit, liquidity, call and market risks, to varying degrees. Generally, all other factors being equal, bond prices are inversely related to interest-rate changes and rate increases can cause price declines. An investment in a money market fund is not a guaranteed investment; it is different to an investment in deposits as the principal invested is capable of fluctuation.

This material has been distributed for informational purposes only. It is educational in nature and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Views expressed are those of the author stated and do not reflect views of other managers or the firm overall. Views are current as of the date of this communication and subject to change. Forecasts, estimates and certain information contained herein are based upon proprietary research and are subject to change without notice. Certain information has been obtained from sources believed to be reliable, but not guaranteed. Please consult a legal, tax or financial professional in order to determine whether an investment product or service is appropriate for a particular situation.

BNY Mellon Investment Management is one of the world’s leading investment management organizations and one of the top U.S. wealth managers, encompassing BNY Mellon’s affiliated investment management firms, wealth management organization and global distribution companies. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation and may also be used as a generic term to reference the Corporation as a whole or its various subsidiaries generally.

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