Asset Classes Defined

by Charles Rotblut, CFA

Asset Classes Defined Splash image

Combining various asset classes in a portfolio to achieve a higher return while lowering risk is a good strategy, but only if you know what you are investing in. Each asset class has unique characteristics that influence its price volatility and level of risk. In this month’s column, I define the major asset classes and explain what factors influence their returns and what risks they carry.

Though each asset class is not without risk, when grouped together in a portfolio, their individual characteristics offset overall inves

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Charles Rotblut, CFA is a vice president at AAII and editor of the AAII Journal. Follow him on Twitter at


Nancy from Maryland posted over 2 years ago:

Where do you classify TIPs and would you also include infrastructure as a separate asset class?

Charles from Illinois posted over 2 years ago:

Nancy, TIPS are a type of bonds and should be classified as fixed-income. Assuming you are investing in infrastructure stocks, it would be grouped under the stocks asset class. -Charles Rotblut, CFA

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