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Introduction to Asset Allocation

  • Henrik Lumholdt
Chapter

Abstract

This is the first of the three foundational chapters of the book. We start off by defining asset allocation and asset classes in Sect. 1.1. We then move on to examine the asset allocation process in Sect. 1.2, the division between strategic asset allocation (SAA) and tactical asset allocation (TAA) in Sect. 1.3, and the investment process in Sect. 1.4. We finish with an analysis of rebalancing strategies and their implications in Sect. 1.5.

References

  1. Ilmanen, Antti, and Thomas Maloney. 2015. “Portfolio Rebalancing, Part 1 of 2: Strategic Asset Allocation”, AQR Portfolio Solutions Group.Google Scholar
  2. Perold, André F., and William F. Sharpe. 1988. “Dynamic Strategies for Asset Allocation”, Financial Analyst Journal, January, 16–27.Google Scholar
  3. Sharpe, William F., Peng Chen, Jerald E. Pinto, and Dennis W. McLeavey. 2007. “Asset Allocation”, in Managing Investment Portfolios: A Dynamic Approach, 3rd edition, ed. John Maginn, Donald Tuttle, Dennis McLeavey and Jerald Pinto. Hoboken, N.J.: John Wiley & Sons.Google Scholar
  4. Swensen, David F. 2009. “Pioneering Portfolio Management: An Unconventional Approach to Institutional Investment”. New York, NY: Free Press.Google Scholar

Copyright information

© The Author(s) 2018

Authors and Affiliations

  • Henrik Lumholdt
    • 1
  1. 1.Instituto de Empresa Business SchoolMadridSpain

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