The True Impact of Asset Allocation on Returns
posted on February 28, 2000 12:00
In summary, the impact of asset allocation on returns depends on an individual’s investing style. For the
long-term, passive investor, the asset allocation decision is by far the most important. For the short-term
investor who trades more frequently, invests in individual securities, and practices market timing, asset
allocation has less of an impact on returns. The impact of asset allocation on performance is directly
correlated with investment style.