# Asset Class

*Saving & Investing — Finicade finance glossary*

An asset class is a group of investments that behave similarly and are driven by similar risks — equities, bonds, cash, property, commodities. Allocation across classes explains the large majority of a portfolio's return variability, far more than security selection within them. The property that makes a class useful is imperfect correlation with the others; when everything falls together in a crisis, apparent diversification across labels turns out to have been one bet.

**Also known as:** asset classes, investment class

**Related terms:** [Asset Allocation](https://finicade.com/glossary/asset-allocation), [Diversification](https://finicade.com/glossary/diversification), [Correlation](https://finicade.com/glossary/correlation), [Alternative Investments](https://finicade.com/glossary/alternative-investments), [Portfolio](https://finicade.com/glossary/portfolio)

Source: https://finicade.com/glossary/asset-class