Your Retirement Plan

Ike IkokwuFinancial Guides, Financial Independence Coach, The Blog

How To Get Started The number of people who are financially unprepared for retirement is staggering. One study revealed that more than half of the adults in the U.S. were planning to depend solely on Social Security for retirement income. Another study indicated that the great majority of Americans do not save nearly enough money. This Financial Guide provides you … Read More

The Efficient Frontier

Ike IkokwuFinancial Guides, Financial Independence Coach, The Blog

The “efficient frontier” concept is a key to investment success. A graph demonstrating the efficient frontier is shown below. Any expected return (left side of graph) carries with it an expected risk (bottom of graph). This risk-reward relationship varies from individual to individual. Conservative investors cannot tolerate more than a low level of risk, and are willing to accept a … Read More

What Is Right For You?

Ike IkokwuFinancial Guides, Financial Independence Coach, The Blog

It’s important to be informed about asset allocation so as to avoid the “cookie cutter” approach that many investors end up accepting. Many of the asset allocations performed today take this “one size fits all” approach. There are all sorts of investment recommendations continually flowing from the financial press. The key question is: Are they suitable for you? Regardless of … Read More

How Are Asset Allocation Models Built?

Ike IkokwuFinancial Guides, Financial Independence Coach, The Blog

Simply stated, financial advisors build asset allocation models by (1) taking historic market data on classes of securities, individual securities, interest rates and various market conditions; (2) applying projections of future economic conditions and other relevant factors; (3) analyzing, comparing and weighting the data with computer programs; and (4) further analyzing the data to create model portfolios.

What Are the Asset Classes?

Ike IkokwuFinancial Guides, Financial Independence Coach, The Blog

The securities that exist in today’s financial markets can be divided into four main classes: stocks, bonds, cash, and foreign holdings, with the first two representing the major part of most portfolios. These categories can be further subdivided by “style.” Let’s take a look at these classes in the context of mutual fund investments:

How Does Asset Allocation Work?

Ike IkokwuFinancial Guides, Financial Independence Coach, The Blog

Asset allocation planning can range from the relatively simple to the complex. It can range from generic recommendations that have no relevance to your specific needs (dangerous) to recommendations based on sophisticated computer techniques (very reliable although far from perfect). Between these extremes, it can include recommendations based only on your time horizon (still risky) or on your time horizon … Read More

What Is Asset Allocation?

Ike IkokwuUncategorized

Asset allocation is based on the proven theory that the type or class of security you own is much more important than the particular security itself. Asset allocation is a way to control risk in your portfolio. The risk is controlled because the six or seven asset classes in the well-balanced portfolio will react differently to changes in market conditions … Read More

Asset Allocation

Ike IkokwuFinancial Guides, Financial Independence Coach, The Blog

How To Diversify For Maximum Return Asset allocation-not stock or mutual fund selection, not market timing-is generally the most important factor in determining the return on your investments. In fact, according to research which earned the Nobel Prize, asset allocation ( the types or classes of securities owned) determines approximately 90% of the return. The remaining 10% of the return … Read More

Financial Planning Checklist

Ike IkokwuFinancial Guides

Once you’ve finished with your tax planning for the year, and your return is safely on its way to the IRS, you’re at an excellent point for a quick financial check-up. Your tax return is handy, as a quick snapshot of your financial situation, and the figures are recent and accurate. Take a few minutes to consider these questions: