If You Are Fired, Will Your Portfolio Cushion the Blow--Or Make It Worse?; Investors don't usually think about their job when designing a portfolio--but they should
When it comes to balancing a portfolio, investors typically take a number of factors into account: the valuations of various assets, their personal financial needs, their tolerance for risk, diversification.</br></br>But here's one thing they often don't consider: their job.</br></br>They should. The risk of losing a job--and which investments can soften that blow or make it hurt even more--could have a major impact on what a portfolio looks like.</br></br>In the simplest scenario, people with little job security shouldn't hold too many risky investments, the pros say. Entrepreneurs, for example, may want to own predominantly lower-risk investments.</br></br>But the connection between your job and your portfolio isn't always that obvious. Sallie Krawcheck found this out the hard way. Ms. Krawcheck, a former senior executive at Citigroup Inc. and then at Bank of America Corp., said in a recent online article at LinkedIn.com, the business networking site, that she and her financial adviser "stress tested" her portfolio in 2007 to see how it would perform if the stock market slumped.