Our Process...

Our Process...

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Asset Allocation

Asset allocation is the process of selecting an array of asset classes that is suitable for an investor’s financial profile in terms of their investment preferences and tolerance for risk. This approach is based on the premise that the different asset classes have varying cycles of performance, and that by investing in multiple asset classes, the overall investment returns will be more stable and less susceptible to adverse movements in any one class.

All investments involve some sort of risk, whether it’s market risk, interest risk, inflation risk, liquidity risk, or tax risk. An individualized asset allocation strategy seeks to mitigate the risks of any one asset class though diversification and balance.

Individual Strategy

Asset allocation is an individualized strategy so there really is no perfect mix of assets. Each client’s strategy is built on the careful consideration of the key elements of their financial profile:

  • Investment Objectives: What is the goal of these investment dollars (e.g., improve current lifestyle, capital growth, or fund a specific goal, such as a college education)?
  • Risk Tolerance: This reflects an investor’s comfort level with market fluctuations that can result in losses. Inflation risk and interest risk need to be considered as well.
  • Investment Preferences: An investor may prefer one asset class over another based on a certain bias or interest towards the characteristics of that class.
  • Time Horizon: The length of time an investor is willing to commit to achieving his objectives.
  • Taxation: Investing in a mix of asset classes will have varying tax consequences.

An Evolving Strategy

About the only certainty when it comes to the financial markets is that they will change and, therefore, your asset allocation decisions are perhaps the most critical factors in developing a long-term investment strategy. We recognize that asset class risks and returns can diverge in the short-term, but we believe they are ultimately driven by economic fundamentals and have predictable long-term relationship patterns.

At every stage, Next Generation Wealth looks past individual investments so, regardless of how global financial markets are performing, your overall portfolio is properly positioned to meet your needs, preferences, priorities, and risk tolerance.

Next Generation Wealth Management | 10700 Research Drive #150, Milwaukee, WI 53226 | Tel: 414.257.4248
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