Alright, time for another short and simple post. Recently, I chanced upon a portfolio named The Gone Fishin’ Portfolio, which basically champions “dividing our money among different asset classes – like stocks, bonds, precious metals and real estate investment trusts – and then rebalance once a year to bring each class back to our original percentage.”

This is nothing new – just another opinion on what is the optimal asset allocation if you ask me. However, what I want to highlight is this particular article by the author, Alexander Green, which has two interesting points.

Factors that Determine Eventual Investment Portfolio Value

First, there is a grand total of 6 factors that determine our eventual investment portfolio value. They are :

  1. How much you save.
  2. How long your investments compound.
  3. Your asset allocation. (How you divide your portfolio between stocks, bonds and other investments.)
  4. Those assets’ annual return…