I often use the analogy of sailing and rowing to explain how to manage money wisely. There are two strategies for sailing, when you are making the most of a favorable wind. There are two other strategies for rowing, when you are trying not to fall behind and lose your way in a storm. The rowing strategies aim to get a return through most market cycles. They are designed to manage the volatility better. A good portfolio is going to have a combination of all four of these strategies.

The two sailing approaches are called “strategic,” and “tactical constrained.” The former calls for a fixed balance of stocks and bonds to weather any storm. The latter adjust those percentages depending on market conditions. The adjustments are tactical, but they are constrained within boundaries. They can only go so far.

The two rowing strategies are “tactical unconstrained” and “absolute return.” The former doesn’t have those constraints that I just mentioned. The latter is based on getting a return during any market cycle, using such tactics as short selling and buying alternative investments.

Many investors will use a combination of those strategies, weighted toward whether their aim is to accumulate assets or preserve and distribute them. The balance of strategies also will depend on the market outlook and their risk tolerance—is the investor aggressive or moderately conservative?