Perhaps posted to the wrong board, but I am retired so here goes.

After extensive reading, Modern Portfolio Theory and Strategic Global Asset Allocation seem to make a lot of sense to me. I have a needed return, a fixed amount to invest and would like to achieve that return or higher with the least amount of risk. I am not interested in beating any index , just having a comfortable retirement with as little stress about finances as possible. Has anyone had personal experience with allocating investments to different asset classes some with high risk, but low correlation to your other investments, to decrease the overall risk of your total portfolio? Some examples I have seen gave Lg US Gro, Lg US Value, Sm US Gro, Sm US Val, Lg Foreign Gro, Lg For Val, Sm For Gro, Sm For Val in fixed % and of course a fixed % in ST Bonds. The idea is to use Index Mutual Funds as much as possible. Rebalance each year, with probably a 70/30 Stk/Bond ratio with the short term bonds being the buffer for down years in the stocks.

Any experiences, thoughts, comments would be appreciated.

Dawg on!

Most often this sort of thing is talked about on the Portfolio Management board:
http://boards.fool.com/Messages.asp?id=1040012000000000

And the Index Funds board:
http://boards.fool.com/Messages.asp?id=1030034000000000

(It's also of interest on my "Risk" board in the speaker's corner, but there are still more questions than answers there.)
http://boards.fool.com/Messages.asp?id=1380712000000000

Personally I think Global Asset Allocation is overblown and becoming less and less important. Think about it, Intel, Texas Insturments, Coca-cola, and any other company worth their weight, is already global. For a refresher, remember in the Asian crisis, Catapillar and International Paper were hurt. They weren't just a US company.

Pick good companies, period.

I also think bonds are a wash. Put 5 years living expenses in a good money market fund and the rest in stocks.

JLC

BeachDawg - Check out efficientfrontier.com It may be what you are looking for.

BeachDawg

There are "canned" computer programs that can perform asset allocation and compute the "efficent frontier"--which is essentially the optimum mix of a portfolio of investments that give you the best risk adjusted return.

My favorite is Frontier Analytics, unfortunately, its pricey. I'm sure there are other less expensive programs.

Most financial advisors provide a "free" asset allocation analysis, but obviously they would want you to invest with them. Of course, you have no obligation to do so.

You can debate and analyze Modern Portfolio Theory to death, but it all comes down to the golden rule of investing, "Don't Put All Your Eggs In One Basket".

Pick a good assortment of mutual funds and stocks, spreading the money between large, medium and small companies, growth and value, a good cross section of sectors (e.g. technology, healthcare, financials, retail) and maybe 15-20% internationally.
Some people like to throw in some REITs.

Balance every now and then, but the key is to pick stocks and mutual with good track records, and future potential, and stick with them for the long haul--I've owned some stocks and mutual funds for 20 years.

Good Luck and Successful Investing!

ez

It not easy for me because I have to many asset place in different IRAs and three 401ks. But I am working to consolidate. But this is what I think you should strive for.

S&P Index 40%.
S&T Fund 20-30%.
International 15%.
Russel 2000 (type) 15%
And if you want a Balance or Value fund to balance it out.
I had alot in Balanced fund (60% S&P and 40% bond Index) for awhile but I have moved it out.
I thinks its very very important that you invest to get this %. And then sort of reallocate from time to time.
Why, Lets assuem on in March of 1999 your allocation looked like the one above.
By today, assuming you made no contributions this is what it would probably look like.
S&P Index 25%.
S&T Fund 40%.
International 15%.
Russel 2000 (type) 20%
Whould you reallocate for change you contribution allocations to try and move back. I choice to use contributions, most of the time.
But I think its also good idea to place something like 25% or less in a fund thats out of favor. I did that with Russell 2000 for tow years then stopped. It took off later.
So what now. Value Value Value Funds. And international have stallled.