Archive · 25 Jun 2025
Asset Allocation Importance: Building Resilient Portfolios
Imagine you have a basket of different fruits.
Instead of putting all your money in one type, asset allocation is like putting some in apples (equities), some in oranges (debt), and some in bananas (commodities).
This way, if one fruit does poorly, the others can still help you get what you want.
Different fruits do better at different times, so spreading out your money helps you not lose too much when one type isn't doing well.
This strategy helps your money grow steadily over time, even when things in the financial world change.
Asset allocation is the strategic mix of investments across asset classes like equity, debt, and commodities.
Different asset classes have taken turns leading and lagging in performance over the last decade.
Diversification helps to reduce portfolio volatility and enhance resilience.
Multi-asset allocation (MAAS) involves distributing capital across different asset classes.
MAAS offers near-equity-level growth with lower volatility, showcasing strong risk-adjusted performance.
- Who
- Shridatta Bhandwaldar, Head of Equities at Canara Robeco Asset Management Company Limited, discusses asset allocation.
- What
- Asset allocation is a strategy of spreading investments across various asset classes such as equities, debt, and commodities.
- When
- Over the last decade, different asset classes have taken turns performing well.
- Where
- N/A
- Why
- To protect capital, reduce risk, and aim for long-term returns in a volatile market.
- Key Strategy
- Asset Allocation
- Asset Classes Used
- Equity, Debt, Commodities
- Benefit of Asset Allocation
- Reduced risk and stable long-term growth
- MAAS benefit
- near-equity-level growth with lower volatility