Definition
A broad type of investment that tends to behave in its own way, like stocks, bonds, cash, commodities or real estate.
The story
Stocks can grow faster but swing more; high-quality bonds usually move less; cash barely moves at all. Because they don't always move together, mixing asset classes is the basis of diversification.
Why markets watch it
Market coverage often describes money moving between asset classes, for example out of stocks and into bonds.
Connects to
We explain why it moves markets. What you do with it is your call. Commentary and education only. Not financial advice. All terms