5) This video makes the important point that people should adjust their investments over the course of their lifetime, adjusting their investment mix to match their tolerance for risk and their time horizon. The term _______ refers to the relative amount of funds invested in each of the investment alternatives (cash, bonds, and stocks).adiversificationbmarket indexingcequity financingdasset allocation
Question
- This video makes the important point that people should adjust their investments over the course of their lifetime, adjusting their investment mix to match their tolerance for risk and their time horizon. The term _______ refers to the relative amount of funds invested in each of the investment alternatives (cash, bonds, and stocks).adiversificationbmarket indexingcequity financingdasset allocation
Solution
The term that refers to the relative amount of funds invested in each of the investment alternatives (cash, bonds, and stocks) is d) asset allocation. This term is used to describe how an individual's portfolio is divided among different asset classes to balance risk and reward according to their investment goals, risk tolerance, and investment horizon.
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