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Allocating assets for your retirement portfolio

In the 1980s, a famous study by Gary Brinson, L. Randolph Hood and Gilbert Beebower determined that asset allocation explained more than 90 percent of the variability of returns in a portfolio. By diversifying your portfolio among various asset classes, you effectively reduce its volatility and risk profile.

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Below are asset allocation recommendations for various age groups provided by the Vanguard Group, known best for its low-cost index and exchange-traded funds. In fact, investors can choose from among various index funds to create a diversified portfolio if they wish to take a passive approach to investing.

Click on your age group to see how the experts think you should invest in the various asset classes. Of course, you must also take into consideration your risk tolerance and adjust your holdings accordingly.

Asset allocation charts

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