A competent financial professional understands that the key to a successful, profitable portfolio is proper asset allocation and diversification.
Types of asset classes include:
In a given year, any one asset class or combination of classes may be up while the others are down. Due to the near impossibility of being able to accurately predict which classes will do well in any particular year, proper diversification between and within assets is integral to maintaining a relatively steady rate of return.
Additionally, the asset allocation right for you at the age of 30 will likely be different than the one recommended to you at 60. Financial professionals have a duty to spend the time necessary to learn about your current circumstances and your future goals in order to recommend the best asset allocation to maximize your return in a manner compatible with your comfort level for risk.
Your financial advisor has to have the big picture in mind. What are your financial goals and what strategy are they going to recommend so that you reach those goals? A good financial strategy is of course going to involve some level of risk, but that risk should be balanced by expected return. In fact, each individual investment will have a different risk/return.
There is no one way or right way to allocate assets, but there are objectively wrong ways for your adviser to handle your investment portfolio. An attorney at Meyer Wilson can evaluate your investment history to see if there are any red flags that could indicate that your adviser was not properly diversifying your portfolio.
If your advisor or brokerage firm failed to adequately allocate your assets, you may have a claim for negligence or misconduct in the event you suffer losses. Due to the high impact asset allocation has on your portfolio's overall performance, your brokerage firm and investment adviser has a duty to provide a considered, deliberate distribution of your assets.
The goal of asset allocation is to maximize returns while minimizing risk. Overall, your financial advisor should be balancing your portfolio for achieving your goals and investment objectives, not their own. If you believe that your financial advisor is improperly allocating your assets, and you suffered significant financial losses, then you may have a claim. Do not hesitate to contact an investment fraud attorney at Meyer Wilson today.
Our firm is no stranger to facing large investment firms on behalf of our clients. We have over 50 years of combined experience helping hundreds of clients recover their wrongfully-lost assets. We recovered over $350 million, and we have no intention of slowing down. The sole aim of our securities lawyers is recovering the financial damages suffered by victims of misconduct.
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