About Michael A. Weiss, CFA Expertise I can provide high quality answers to questions about mutual funds domiciled in the United States. Overall, I have 15 years of investment experience. I am currently the Editor of <a href="http://www.mutualfundinvestor.net/">The Mutual Fund Investor</a>, a quarterly publication that provides recommendations and commentary on various no-load mutual funds. I am also currently the Chief Investment Officer of a state registered investment advisory firm that specializes in no-load mutual funds.
Experience Overall, I have 15 years of investment experience. I am currently the Editor of The Mutual Fund Investor, a quarterly publication that provides recommendations and commentary on various no-load mutual funds. To learn more about The Mutual Fund Investor, please visit <a href="http://www.mutualfundinvestor.net/">http://www.mutualfundinvestor.net/</a>. I am also currently the Chief Investment Officer of a state registered investment advisory firm that specializes in no-load mutual funds.My mutual fund experience began at a company called Lipper Analytical Services, where I researched and wrote about mutual funds. Lipper is one of the premier mutual fund research and ratings organizations. After Lipper, I worked as an investment analyst for Merrill Lynch’s multi-billion dollar Mutual Fund Advisor and Selects Programs. I also have experience working with individual stocks and bonds. I have managed investment portfolios for both Merrill Lynch Investment Managers as well as Evergreen Investments.<BR><BR><B>Organizations</B><BR>CFA Institute
CFA Society of Philadelphia
<BR><BR><B>Publications</B><BR>The Mutual Fund Investor
<BR><BR><B>Education/Credentials</B><BR>CFA charterholder
MBA in Finance and Investments from the Zicklin School of Business at Baruch College<BR>
Expert: Michael A. Weiss, CFA Date: 12/7/2007 Subject: Asset Allocation
Question Hi Michael,
Could you suggest an asset allocation strategy of how a beginning investor desiring moderate to high growth (say in their 20's) would start in mutual funds. Whilst through the passage of time how much change should the investor direct to his portfolio allocation of funds to become more conservative, from 20's all the way to the stages of retirement.
Assuming the investor never needs to withdraw any significant amount from the portfolio of funds and keeps reinvesting the dividends for most of their life.
Answer Hi Jim,
Thank you for the question. Please understand that I cannot provide you with personalized investment advice in this type of forum. With that said, I will certainly try to help you.
There is no one correct answer to your questions. In general, a younger person should invest primarily in a diversified portfolio of equity mutual funds, assuming that this person has a high enough risk tolerance to withstand the fluctuations associated with equity investing. Within the equity funds, an investor should generally have exposure the major equity styles such as large cap, small-cap, value, growth and international. Some people like to emphasize one size or style over another, but for someone relatively new to investing, a fully diversified approach makes allot of sense.
Over time, investors generally reduce equity exposure and begin increasing exposure to fixed income mutual funds. Your total fixed income exposure would depend on several factors including but not limited to your time horizon and risk tolerance. Again, there is no one correct answer to the percentage you should have in fixed income mutual funds. Everyone's circumstances are different.
It is important to note that your risk tolerance is the most important factor in forming an asset allocation. Unfortunately, many people do not have a good sense of their own risk tolerance until they are losing money. In up markets, people are usually overconfident about their risk tolerance.
When selecting any mutual fund, you should consider several factors including but not limited to historical performance, volatility, expenses, and the quality of management.
