A framework, not a formula
Investor.gov explains asset allocation as dividing investments across asset categories. It links the decision to time horizon and tolerance for loss, and distinguishes allocation from diversification within each category.
The questions come first
An allocation percentage says little without knowing when capital may be needed, how holdings overlap, what access restrictions apply and what the full cost structure looks like. The same broad category can contain very different exposures.
Understand the illustration
Our lab combines user-entered asset weights and assumed returns into a constant annual scenario. It is useful for seeing arithmetic effects, including fees and inflation. It cannot assess personal suitability, correlations, future volatility or the chance of a loss.
A next step in research
Read underlying investment documents, check holdings and access terms, and understand the role of qualified advice before making investment decisions. An educational model is only one small part of that process.
Sources: S05. Reviewed 13 November 2026.
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