Asset allocation

Asset allocation — how the portfolio divides across asset classes: global equities, PH income equities/REITs, guaranteed peso instruments, cash, speculation. The evidence’s headline: the overall split between equities and the stable layer drives outcomes more than fund choice, geography tilts, or any “supercharge” — get the split right and the rest is refinement. Set it by risk capacity (financial ability to absorb loss) and risk appetite (emotional ability), write it as target weights in the IPS, and let rebalancing rules maintain it.

First used in: 2.6 · Portfolio construction