What is an "asset allocation fund"?
An asset allocation fund is a mutual fund that is trying to provide a very broad diversification amongst various asset classes. It might do that by actually purchasing other mutual funds or might just be purchasing the individual stocks themselves. Traditionally, an asset allocation fund could be the only mutual fund you will need because it's going to provide the asset allocation, meaning it's going to try to buy either funds or securities in different asset classes to provide that broad classification.