Jakarta, CNBC Indonesia – Again, the author of the book Rich Dad & Poor Dad, Robert Kiyosaki commented on investment via his X social networking account (formerly Twitter). Kiyosaki assesses that stock and bond investors will suffer losses next year and he also conveys an asset allocation strategy that can generate profits.
“Very stupid. Financial experts will forever promote smart investment ideas with a 60/40 strategy, which means 60% (of funds allocated) to bonds, and 40% to shares. In 2024, investors (with a 60/40 strategy) will be the ones who experience a big loss. Before (you) sink with (your) ship, consider placing 75% of your capital in gold, silver and Bitcoin, 25% in property and oil stocks. This combination will make you able to face the biggest crash in world history , good luck and be careful,” Kiyosaki tweeted.
Asset allocation & diversification
Placing all your investment capital in shares is actually possible, but are you ready for the risk?
Even though both are done by spreading investment capital, asset allocation and diversification are two different things.
Asset allocation is spreading investment capital across several different asset classes, for example stocks, bonds, and money market instruments or real assets.
Meanwhile, diversification is spreading investment capital across the same asset class. For example, if you choose shares, you can spread your investment capital into shares in the banking, mining, consumer goods and other sectors.
The goal of asset allocation and diversification is to reduce risk and maximize your investment returns.
Stocks and bonds are often referred to in the classic asset allocation concept. By having these two assets in our personal investment portfolio, we can minimize losses while maximizing the returns we get in the future.
The ideal asset allocation must of course be based on the financial goals or level of risk profile of the investor concerned. Investors who have a conservative risk profile tend to hold more assets with low fluctuation or fixed income than those with high risk.
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