what is an aggressive investment strategy 
an aggressive investment strategy typically refers to a style of portfolio management that attempts to maximize returns by taking a relatively higher degree of risk strategies for achieving higher than average returns typically emphasize capital appreciation as a primary investment objective rather than income or safety of principal such a strategy would therefore have an asset allocation with a substantial weighting in stocks and possibly little or no allocation to bonds or cash aggressive investment strategies are typically thought to be suitable for young adults with smaller portfolio sizes because a lengthy investment horizon enables them to ride out market fluctuations and losses early in one s career have less impact than later investment advisors do not consider this strategy suitable for anyone else but young adults unless such a strategy is applied to only a small portion of one s nest egg savings regardless of the investor s age however a high tolerance for risk is an absolute prerequisite for an aggressive investment strategy understanding aggressive investment strategythe aggressiveness of an investment strategy depends on the relative weight of high reward high risk asset classes such as equities and commodities within the portfolio for example portfolio a which has an asset allocation of 75 equities 15 fixed income and 10 commodities would be considered quite aggressive since 85 of the portfolio is weighted to equities and commodities however it would still be less aggressive than portfolio b which has an asset allocation of 85 equities and 15 commodities even within the equity component of an aggressive portfolio the composition of stocks can have a significant bearing on its risk profile for instance if the equity component only consists of blue chip stocks it would be considered less risky than if the portfolio only held small capitalization stocks if this is the case in the earlier example portfolio b could arguably be considered less aggressive than portfolio a even though it has 100 of its weight in aggressive assets yet another aspect of an aggressive investment strategy has to do with allocation a strategy that simply divided all available money equally into 20 different stocks could be a very aggressive strategy but dividing all money equally into just 5 different stocks would be more aggressive still aggressive investment strategies may also include a high turnover strategy seeking to chase stocks that show high relative performance in a short time period the high turnover may create higher returns but could also drive higher transaction costs thus increasing the risk of poor performance aggressive investment strategy and active managementan aggressive strategy needs more active management than a conservative buy and hold strategy since it is likely to be much more volatile and could require frequent adjustments depending on market conditions more rebalancing would also be required to bring portfolio allocations back to their target levels volatility of the assets could lead allocations to deviate significantly from their original weights this extra work also drives higher fees as the portfolio manager may require more staff to manage all such positions recent years have seen significant pushback against active investing strategies many investors have pulled their assets out of hedge funds for example due to those managers underperformance instead some have chosen to place their money with passive managers these managers adhere to investing styles that often employ managing index funds for strategic rotation in these cases portfolios often mirror a market index such as the s p 500 