Joe Lyons


As a CERTIFIED FINANCIAL PLANNER™, Joe Lyons is bullish on asset allocation as part of a sound strategy for wealth creation. Essentially, asset allocation involves working with different asset classes to create an appropriate mix of assets designed with the goal to preserve wealth. Dividing your investment portfolio among many different asset categories, such as stocks, bonds and cash helps to manage your risk of losing money over time.

Deciding what assets to include in your portfolio is a personal one, dependent largely on 1) your time horizon, or the expected number of months, years or decades you’ll be investing to pursue a financial goal; and 2) your willingness to take on greater risks in exchange for the potential of larger returns in the future.

For example, If your timeline is longer, you may be more open to take on riskier, more volatile stock than you would saving for your teenager’s college education. Likewise, if you have a high-risk tolerance, you’re more likely to risk losing money in order to pursue better results than a more cautious or conservative investor would be.

Once you figure out timing and risk tolerance, it’s important to work with different asset classes for a suitable mix of assets designed with the goal to preserve wealth. Building on the strengths of each class while seeking to minimize their shortcomings, helps to strengthen your portfolio.

Money market accounts and government bonds offer lower volatility, but are still open to interest rate risk. Commodities offer a greater return potential on investment, but the fast price swings will result in significant volatility and are less liquid than other assets. While less volatile than commodities, stocks are vulnerable to economic growth risk, and returns to stocks are relatively inconsistent.

Remember, it’s always good to consult with an investment advisor. A good advisor can evaluate your situation carefully to choose the appropriate mix of assets for your portfolio. You can also visit us at for articles on a wide range of investment topics, or call us at 847.382.2600 to speak to us directly.

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. Asset allocation does not ensure a profit or protect against a loss. Stock investing involves risk including loss of principal. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.

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