Investment Lineup

Written by True Tamplin, BSc, CEPF®

Reviewed by Subject Matter Experts

Updated on January 23, 2024

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What Is Investment Lineup?

An investment lineup is a selection of investment options available to an investor in a defined contribution plan, such as a 401(k) or 403(b).

The investment lineup typically consists of a range of mutual funds, exchange-traded funds (ETFs), and other investment products that an investor can choose to allocate their retirement savings.

The investment lineup is usually selected by the plan sponsor, such as an employer, or the plan administrator, and is designed to provide a diversified set of investment options that can help investors achieve their retirement goals.

The investment options in the lineup may vary in terms of asset class, investment style, risk level, and fees.

Types of Investment Assets

Types of Investment Assets


Domestic Stocks

Domestic stocks represent shares of ownership in companies based within an investor's home country. Investing in domestic stocks allows investors to participate in the growth of their country's economy.

International Stocks

International stocks offer investors exposure to companies based outside their home country. Investing in international stocks can provide additional diversification and access to growth opportunities in emerging and developed markets.

Fixed Income

Government Bonds

Government bonds are issued by national governments to fund public projects or refinance existing debt. They are generally considered to be lower-risk investments and can provide a steady stream of income.

Corporate Bonds

Corporate bonds are issued by companies to raise capital for business expansion or other purposes. They typically offer higher yields than government bonds but carry higher risk.

Municipal Bonds

Municipal bonds are issued by local governments or other public entities to fund public projects like infrastructure or schools. They offer tax advantages for investors in the United States, as interest income is generally exempt from federal income taxes.

Alternative Investments

Real Estate

Real estate investments include both physical properties and real estate investment trusts (REITs). They can provide income through rental payments and potential capital appreciation.


Commodities, such as precious metals, oil, and agricultural products, can offer diversification benefits and act as a hedge against inflation.

Private Equity

Private equity investments involve the direct ownership of private companies or stakes in private companies. They can offer high returns but are less liquid and carry higher risk.

Hedge Funds

Hedge funds are investment funds that use various strategies to generate returns, often with limited correlation to traditional asset classes. They can be complex and carry high fees but may offer diversification benefits.

Cash Equivalents

Money Market Funds

Money market funds are low-risk investment vehicles that invest in short-term, high-quality debt securities, providing investors with liquidity and preservation of capital.

Certificates of Deposit

Certificates of Deposit (CDs) are time deposits issued by banks that pay a fixed interest rate over a specified term. They offer a low-risk option for investors seeking capital preservation and a predictable income stream.

Factors to Consider in Building an Investment Lineup

Factors to Consider in Building an Investment Lineup

Investment Goals and Objectives

Investors should clearly define their financial goals and objectives, such as saving for retirement, funding education, or buying a home, to guide their investment lineup decisions.

Risk Tolerance and Capacity

Understanding an investor's risk tolerance and capacity is essential in building an appropriate investment lineup. Investors should consider their ability and willingness to withstand potential losses or fluctuations in the value of their investments.

Time Horizon

The investment time horizon, or the length of time an investor expects to hold investments before needing the funds, plays a significant role in determining the appropriate investment lineup.

Liquidity Needs

Investors should consider their liquidity needs, or the ability to quickly convert investments into cash without incurring significant losses when selecting investments for their lineup.

Tax Considerations

Tax implications, such as capital gains taxes or tax-exempt investments, should be considered when building an investment lineup to maximize after-tax returns.

Diversification Strategies

Diversification Strategies

Asset Allocation

Asset allocation involves spreading investments across various asset classes, such as equities, fixed income, and alternative investments, to reduce risk and increase potential returns.

Geographic Diversification

Geographic diversification involves investing in assets from different countries or regions to mitigate country-specific risks, such as political instability or economic downturns.

Sector Diversification

Sector diversification refers to investing across various industries and sectors, such as technology, healthcare, or consumer goods, to reduce the impact of sector-specific risks on an investment portfolio.

Investment Style Diversification

Investment style diversification involves investing in different investment styles, such as growth, value, or dividend-focused strategies, to benefit from various market conditions and reduce overall portfolio risk.

Investment Vehicles

Mutual Funds

Mutual funds pool money from multiple investors to invest in a diversified portfolio of stocks, bonds, or other assets, offering instant diversification and professional management.

Exchange-Traded Funds

ETFs are investment funds that trade on stock exchanges like individual stocks. They offer many of the same diversification benefits as mutual funds, with added advantages such as intraday trading and potentially lower fees.

Individual Stocks and Bonds

Investing directly in individual stocks and bonds allow investors to build a customized investment lineup but may require more time and expertise to manage effectively.

Managed Accounts

Managed accounts involve hiring a professional investment manager to build and maintain a customized investment lineup on an investor's behalf, typically for a fee.

Monitoring and Rebalancing

Performance Evaluation

Regularly reviewing the performance of investments within an investment lineup is crucial for identifying underperforming assets and ensuring the portfolio remains aligned with an investor's goals and risk tolerance.

Rebalancing Frequency and Thresholds

Rebalancing involves adjusting the allocation of assets within an investment lineup to maintain the desired level of diversification and risk exposure. Investors should establish a rebalancing frequency and set thresholds for when adjustments should be made.

Tax-Efficient Rebalancing Strategies

When rebalancing, investors should consider tax-efficient strategies, such as selling assets with losses to offset gains or utilizing tax-advantaged accounts, to minimize the tax impact of portfolio adjustments.

Working With a Financial Advisor

Benefits of Professional Advice

Working with a financial advisor can provide investors with expert guidance, tailored investment recommendations, and ongoing support in managing their investment lineup.

Selecting a Financial Advisor

Choosing the right financial advisor involves evaluating factors such as credentials, experience, investment philosophy, and communication style.

Fee Structures and Transparency

Understanding a financial advisor's fee structure and ensuring transparency in costs is essential for investors to make informed decisions about the value of professional advice.


Building a strong investment lineup is crucial for long-term success in achieving financial goals. Investors need to consider various factors, including investment goals and objectives, risk tolerance, time horizon, liquidity needs, and tax considerations when selecting investment assets.

Diversification strategies, such as asset allocation, geographic diversification, sector diversification, and investment style diversification, can help reduce portfolio risk and increase potential returns.

There are various investment vehicles available, such as mutual funds, ETFs, individual stocks and bonds, and managed accounts, that offer different levels of diversification and professional management.

Monitoring and rebalancing the investment lineup regularly is essential to ensure it remains aligned with the investor's goals and risk tolerance.

Finally, working with a financial advisor can provide investors with expert guidance and ongoing support in managing their investment lineup.

By understanding these concepts and implementing them, investors can build a well-diversified and balanced investment lineup that can help them achieve their financial goals over the long term.

Investment Lineup FAQs

About the Author

True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website or view his author profiles on Amazon, Nasdaq and Forbes.

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