Assets in a portfolio should be weighted:
Understand the Problem
The question is asking about the appropriate method to weight assets in a portfolio, suggesting different strategies for asset allocation based on risk and conviction.
Answer
According to your conviction
The final answer is: According to your conviction
Answer for screen readers
The final answer is: According to your conviction
More Information
Portfolio weights should reflect the investor's confidence level and strategy. Adjusting weights based on conviction allows investors to allocate more capital to assets in which they have higher confidence.
Tips
A common mistake is confusing conviction weighting with risk weighting; identify your strategy before deciding how to weight assets.
Sources
- How should I weight the stocks in my portfolio? - Stockopedia - stockopedia.com
- Portfolio Rebalancing and Weighting Strategies - arborinvestmentplanner.com
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