Are 50/50 Allocations Still a Smart Choice?
… Clearly, if we could be blessed with the foresight then comparable to our hindsight now, there would have been better allocations than 50/50. While we’re at it, we could carry this to an even greater extreme and argue that judicious changes between CREF Stock and CREF Money Market would have produced a still better result. Some participants do try to capture those results and even pay advisors substantial fees to try to capture them. Investment experts disagree about a lot of things, but one general proposition that almost all would subscribe to is that frequent reallocation based on predicting future stock market swings and interest rate changes is extraordinarily hard to do, and the vast majority of investment programs that play that game end up losing money compared with ones that stay with a simple fixed strategy.
