Maximizing Portfolio Returns: The Key to Successful Asset Allocation
The chapter discusses how asset managers aim to build portfolios that match investors' goals. Strategic asset allocation focuses on maximizing returns while managing risks, tailored to each investor. Tactical asset allocation is a part of this strategy. Diversification is key, but has limits. Choosing the best managers for different assets is crucial. Investment due diligence assesses managers' risk management and how they incorporate ESG factors into their decisions.