Scottrade's Portfolio Review Tool offers five different asset allocation models, called Target Models, to help you choose an allocation that works with you toward meeting your investment goals. Each target model represents a different investment strategy using a unique asset allocation to diversify investments across six market segments. A seventh market segment represents 'other'investments in your account, including options and short-term investments.
When you select a model, you can use it as the framework for changing your portfolio's allocation. This process offers you an easy way to reallocate your investments using an established strategy and know that your asset allocation aligns with that strategy.
Determining the way your assets are divided across the different market segments is the first step to diversifying your portfolio. Once you've done this, your second step will be to diversify your investments within each market segment.
To select a target model that represents your investment strategy:
- Click the Select My Target Model button.
- Read Select My Target Model to learn more and make sure you choose the model that's going to best support your investment objectives. You can also click the Learn More links under each Target Model to find out more information.
- Once you've researched each model and chosen the one that best fits your strategy, click the Select Model button. The selected model will appear at the top of the page next to the Current Allocation section.
Note: Selecting a Target Model does not implement any changes to your current portfolio. It will act as a framework for creating an Action Plan to reallocate your portfolio. You'll have a chance to review these decisions later before placing any trades.
How to Use This Information
From here, you can compare the current allocation of your portfolio to the allocation of the Target Model you selected ato help determine changes you can make to align your portfolio with the Target Model.
To get a closer look at how your portfolio can be reallocated to align with the Target Model you selected, click the Set Up Allocation button.
Next Step: Setup Allocation
Keep in mind that while diversification may help spread risk it does not assure a profit, or protect against loss, in a down market.
The analytical tools described in this article are for information purposes only and their use does not guarantee a profit. None of the information provided should be considered a recommendation or solicitation to invest in, or liquidate, a particular security or type of security. Investors should fully research any security before making an investment decision.