Defend two asset allocations teacher packet

Selected outcome

Investing 12-6a: Recommend different broad asset allocations for shorter and longer term goals.

This is an independent selective correlation, not an official endorsement or a complete curriculum.

Teacher preparation

Open the allocation glide path and test its keyboard controls before class.
Share or print the student handout.
State that the chart uses illustrative volatility inputs and is not a recommendation engine.

Fictional scenario

Case A needs the money in three years. Case B will not use the money for 35 years. Both cases are fictional, have the same starting balance, and compare only broad stock and bond shares.

Checked resources

Allocation glide path
Students draw and read two broad mixes.
https://www.financelearn.org/tools/allocation-glide-path
Asset allocation guide
Students define time horizon and risk capacity.
https://www.financelearn.org/guides/asset-allocation
Risk and return explorer
Students test why expected return is not a guarantee.
https://www.financelearn.org/tools/risk-return-explorer

Student task sequence

Task 1. Before using the tool, predict which case can usually tolerate more short-run fluctuation and explain why.
Task 2. Use the allocation path to create one broad stock-and-bond mix for the three-year case. Record the mix and one risk.
Task 3. Create a different mix for the 35-year case. Record the mix and one risk.
Task 4. Defend why the two mixes differ without saying that age alone determines the answer.
Task 5. Name one fact missing from both fictional cases that a real decision would require.

Teacher key

Task 1. The 35-year case generally has more time to recover from short-run losses. Time horizon does not remove risk.
Task 2. No single percentage is required. Credit depends on a lower fluctuation tolerance and a stated tradeoff for the near-term use.
Task 3. No single percentage is required. Credit depends on connecting the longer horizon to greater capacity for fluctuation while still naming loss risk.
Task 4. A strong defense compares when the money is needed, not only the fictional person's age.
Task 5. Acceptable missing facts include loss tolerance, emergency reserves, other assets, debt, income stability, or the consequence of missing the goal.

Four-point evidence check

Award one point for each visible item.

Two different stock-and-bond mixes are recorded.
Each mix has a named downside.
The defense uses time horizon and does not present a personal recommendation.
One relevant missing fact is named.

Extension

Keep both end points fixed, change only the bend of the path, and explain how the middle years move.

Ready-to-paste LMS post

Defend two asset allocations

Time: 35 minutes
Goal: Connect time horizon to capacity for short-run fluctuation and explain an allocation tradeoff.

Student handout: https://www.financelearn.org/lessons/time-horizon-allocation/student

Directions:
1. Open the handout and use only its fictional scenario and linked resources.
2. Complete all 5 tasks and show the requested reasoning.
3. Submit the completed handout in the format your teacher names.

Privacy: Do not use personal income, debts, account balances, policy details, names, or identifying information.
No FinanceLearn account is required. Educational material, not financial advice.

Launch links