Three Things to Understand About The Asset Allocation In Your Portfolio

Joshua Dobi |

A popular topic among our clients is asset allocation. Asset allocation is a term used to describe what financial assets you own and where in the investment universe you have areas of concentration or not. These areas can include things like stocks, bonds, real estate, and cash. A question we seem to get on repeat is, “What’s the appropriate amount of asset allocation?”


There’s no right or wrong answer here. Each person, and their situation, is different and that’s why at Oakwood Financial Group we meet our clients at their point of need. There is no one-size-fits-all when it comes to asset allocation. However, there are three key things we think you should consider.


Understand what you have.

We can’t stress this enough. It’s not true that just because you own fund A, B, and C, that you are allocated in the ways you would like to be. We talk to people all the time that have very little knowledge about what they own. We recommend reaching out to your financial advisor to look at where things are. You don’t have to know how the watch is made but you do need to know what time it is.


Only make changes if it makes sense.

When you are doing that evaluation of your assets, don’t make changes just to make changes. Only make changes if there is a good reason to do so. If you are out of kilter from an asset allocation standpoint, it may or may not be a good time to make changes inside of your portfolio. If you are going to make modifications, do so for the right reasons. If the proposed adjustments will point you towards your long-term goals, then it’s time to consider them.


Look at mitigation or hedging strategies.

You may be someone who doesn’t need that. You may be someone who opts to be more aggressive in one way or another and aren’t really worried about downside risk. That’s okay as long as you understand both sides of the risk spectrum. Meaning there’s the good side of the risk spectrum and the not so pleasant side.


Hedging is a risk management strategy that investors employ to offset losses in investments by taking an opposite position in a related asset. If you’re more interested in looking at mitigation or hedging strategies to protect against downside risk, look at those opportunities inside of your portfolio. But only if they make sense for you.


If you have questions about your financial goals or would like to talk with us further about your asset allocation, give us a call at (412) 928-8801 or visit us at If you wish to schedule an introductory meeting, we would be happy to meet with you at no cost or obligation to you.


These Blogs are provided for informational purposes only and should not be construed as investment advice. Any opinions or forecasts contained herein reflect the subjective judgments and assumptions of the authors only and do not necessarily reflect the views of SagePoint Financial.