Question

The objective of asset allocation is to

A) make investment decisions easier.
B) ensure the returns of the individual investments within a portfolio.
C) achieve a desired return on investment and eliminate the adverse risk of investing.
D) achieve a desired return on investment and maintain a tolerable risk level

Answer 1

The objective of asset allocation is to achieve a desired return on investment and maintain a tolerable risk level by diversifying investments.

Step-by-step explanation:

The objective of asset allocation is to achieve a desired return on investment and maintain a tolerable risk level. By allocating assets across different investment options, such as stocks, bonds, and cash, investors can balance their desired return with an acceptable level of risk. This allows them to potentially earn higher returns while minimizing the negative impact of investment risk.