A well-defined asset allocation is the foundation of any successful investment strategy. It shapes how your portfolio responds to market changes, balances risk and return, and ultimately helps you stay on track toward your long-term financial goals.

KEY TAKEAWAYS

Your mix of stocks, bonds, and other assets is the single most important factor influencing long-term performance.
Spreading investments across asset classes, regions, and sectors helps manage risk in uncertain markets.
Staying invested, rebalancing regularly, and adapting when needed are critical to long-term success.

In today’s environment—marked by higher interest rates, global diversification opportunities, and evolving asset classes—having a thoughtful, personalized allocation is more important than ever. Here are some steps to help you accomplish this.

Start with the Right Mix

The most impactful decision in building your asset allocation with your Financial Advisor is determining how to divide your portfolio between growth-oriented assets like stocks and more stable investments like bonds.

From there, you can take the process a step further:

How much to invest in U.S. stocks vs. international stocks?
How much in developed vs. emerging markets?
Should you overweight or underweight certain sectors, such as health care or energy?

Another consideration is whether to incorporate additional asset classes, such as real estate, commodities, or alternative investments. Every asset allocation is unique and depends entirely on each investor’s goals, needs, and preferences. The optimal mix depends entirely on your individual goals, time horizon, income needs, and risk tolerance.

The Importance of Diversification

One of the core tenets of any asset allocation is diversification. In short, diversification is a way of spreading out your investments and making sure that you are not overexposed to any one asset class or area of the market. Most asset classes do not move in lockstep with one another, so by investing in a diversified mix, you may be able to build a more resilient portfolio.

Just as importantly, diversification reduces reliance on any single investment or theme. Even well-researched ideas can underperform due to unexpected developments. A diversified approach helps ensure your portfolio is built to weather a wide range of outcomes—not just the ones you anticipate.

Stay Invested Through Market Cycles

Creating an asset allocation is only the first step—sticking with it is where many investors fall short.

Market volatility can tempt investors to make reactive decisions:

Moving to cash or bonds after downturns
Increasing stock exposure after strong rallies

While these shifts may feel intuitive, they often result in missed opportunities or increased risk at the wrong time. Maintaining discipline—especially during periods of uncertainty—is essential to capturing long-term market returns.

Rebalance and Reassess Regularly

Over time, market movements can cause your portfolio to drift away from its intended allocation. For example, a portfolio designed as 60% stocks and 40% bonds may become significantly more equity-heavy after a strong stock market run. Rebalancing helps bring your portfolio back in line with your target risk level.

It’s also important to periodically revisit your allocation with your Financial Advisor:

Have your goals or time horizon changed?
Has your risk tolerance shifted?
Are there new opportunities or risks in the market?

Regular check-ins ensure your strategy evolves alongside your life and the broader investment landscape.

A personalized asset allocation is not a one-time decision—it’s an ongoing process. By combining thoughtful diversification, disciplined execution, and regular maintenance, you’ll have the ability to build a portfolio designed to navigate uncertainty and stay aligned with your long-term objectives.

Working With Janney

Depending on your financial needs and personal preferences, you may opt to engage in a brokerage relationship, an advisory relationship or a combination of both. Each time you open an account, we will make recommendations on which type of relationship is in your best interest based on the information you provide when you complete or update your client profile.

If you engage in a brokerage relationship, you will buy and sell securities on a transaction basis and pay a commission for these services. Our recommendations for the purchase and sale of securities will be based on what is in your best interest and reflect reasonably available alternatives at that time.

If you engage in an advisory relationship, you will pay an asset-based fee, which encompasses, among other things, a defined investment strategy, ongoing monitoring, and performance reporting. Your Financial Advisor will serve in a fiduciary capacity for your advisory relationships.

For more information about Janney, please see Janney’s Relationship Summary (Form CRS) on www.janney.com/crs which details all material facts about the scope and terms of our relationship with you and any potential conflicts of interest.

By establishing a relationship with us, we can build a tailored financial plan and make recommendations about solutions that are aligned with your best interest and unique needs, goals, and preferences.

Janney Montgomery Scott LLC, its affiliates, and its employees are not in the business of providing tax, regulatory, accounting, or legal advice. These materials and any tax-related statements are not intended or written to be used, and cannot be used or relied upon, by any taxpayer for the purpose of avoiding tax penalties. Any such taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor.

Ref #: 2585850