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Investing & portfolio
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How you divide money between asset classes drives most of your portfolio's risk. Stocks grow faster but fall harder, bonds and cash are steadier, and gold often moves differently from both.
Your split should depend on two things: how much of a fall you can sit through, and how much money you have to work with.
Some assets only make sense above a minimum size. Direct property needs a large down payment, so small investors use REITs or skip it. Silver and crypto slices below about 1,200 (US dollar terms) are too small to matter, and gold starts to be worth holding from around 300.
In the asset allocation calculator, assets you cannot sensibly hold at your amount switch off and their share moves to the rest.
With 500, a balanced mix is about 53% stocks (an index fund), 29% bonds, 9% cash and 9% gold. With 10,000 it becomes 49% stocks, 28% bonds, 9% cash, 9% gold, 2% silver and 3% crypto.
A careful investor with 100,000 might hold 20% stocks, 45% bonds, 15% cash, 12% gold, 3% silver and 5% real estate. Change the risk profile or any percentage and the others adjust so the total stays 100%.
Keep the emergency fund outside your investments. A common rule is 6 months of expenses for a steady salary, 9 months for variable income and 12 months if others depend on you.
If your monthly expenses are 2,000 and your income is steady, that is 12,000 kept in an easy-access account before you invest anything.
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Beyond the emergency fund, many investors hold 10 to 20% of their stock allocation as cash or short-term bonds, so a market fall becomes a chance to buy.
The calculator also runs a recession stress test, applying a typical bad-year move to each asset so you can see roughly how far your total could fall before it happens.
Use the free Asset Allocation Calculator to build your own split. It runs in your browser and saves nothing. To plan buying after a fall, see averaging down.
This is educational content, not investment advice. Figures are illustrations, not forecasts or recommendations.
It is 60% stocks and 40% bonds, a classic balanced mix. The balanced profile in the calculator is more diversified, adding gold, cash and small slices of other assets as your amount allows.
Yes. Keep 6 to 12 months of expenses in an easy-access account first, and keep it outside your investment split.
If you hold any, keep it to a small slice you could lose entirely without changing your life, often 0 to 5%.
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