MONEY OBEDIENCE

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An aggressive asset allocation sets out to avoid risks like the risk that you will not reach your financial goals by assuming much greater than average market risk, that is putting a relatively large amount of money into the stock market.

For example, you may be driven to avoid the risk that you will not reach your financial goals and purchasing power risk, but you may not be opposed to assuming a lot of market risk. By putting money into investments like stocks, this additional risk may help you avoid other risks. With a very aggressive asset allocation you put a lot more of your savings into the stock market than would be sufficient to contain other risks.