If your investment portfolio lost 20 percent of its value, would you:

a) Ignore it. Who reads those account statements anyway?

b) Pour money in. It’s a chance to pick up bargains, right?

c) Dump the rest of your investments. After all, cash stashed in a coffee can won’t lose value, will it?

What’s the right answer? Well, exaggerations aside (use a bank, not a coffee can), any of the three choices can be right. It depends on what your investments are for, how long you have until you’ll need to cash them in and how well you can stand the ups and downs of the market.

Those are key questions — and not easy ones to answer. Right now, most investors should be wrestling with them, because the rebound in stock prices and drop in bond prices have left many portfolios out of kilter.

Though your plan might call for 60 percent stocks (meaning stock funds as well), 30 percent bonds and 10 percent cash, you may be at 70 percent stocks and only 20 percent bonds. If so, it’s time to “rebalance” — to adjust your “asset allocation,” the mix of stocks, bonds and cash.

But how do you know what the allocation should be?

Most pros base this calculation on two factors: the past performance of various kinds of investment and the individual investor’s tolerance for risk. Unfortunately, these criteria are far from perfect.

Past performance is based on annual averages calculated from decades of data. Obviously, there’s no guarantee that stocks, bonds and other investments will do as well in the next decade as they’ve done in the past.

Measurements of risk tolerance also can be very misleading. Lots of computer programs and Web sites use questionnaires to assess how much risk the investor is willing to take. But the results can vary widely.

A recent study by researchers Ken C. Yook, a finance professor at Johns Hopkins University, and Robert Everett, a financial analyst at HOLT Value Associates in Chicago, found that six widely used risk-tolerance questionnaires produced very different results for the same investors.

Also, computerized questionnaires simply take the investor’s responses at face value. If you indicate you’d run like a rabbit after suffering a minor loss, the questionnaire is likely to determine you have a low tolerance for risk, leading to a conservative investment strategy with a big share of your money in bonds and cash.

But a good human adviser would probably say your worries are overblown and demonstrate that you’ll have a better chance of building up the nest egg you need by putting more into stocks. Good financial advisers are teachers.

Online suggestions

On Friday, I filled out online questionnaires from Vanguard Group and Fidelity Investments. When I indicated a willingness to take big risks, the Vanguard program recommended I put 80 percent of my portfolio into stocks, 20 percent into bonds; Fidelity recommended 85 percent stocks, 15 percent bonds.

Changing just a few responses to look more averse to risk caused the Vanguard program to recommend 50 percent stocks and 50 percent bonds, while Fidelity recommended 50 percent stocks, 40 percent bonds and 10 percent cash.

These are not small differences. Shifting 10, 20 or 30 percent of your portfolio from one investment to another could take a lot of work and might trigger big commissions and tax bills on any profits realized when investments are sold. It would be a shame to suffer all that expense and hassle just because you gave one or two ill-advised answers on the questionnaire.

At the same time, decisions about asset allocation are critical to your long-term investment results.

Using data from 1926 through 2001, Vanguard found that a conservative portfolio of 10 percent stocks, 80 percent bonds and 10 percent cash had an average annual return of 6.2 percent. Its biggest loss in a single year was 6.7 percent, and it racked up losses in only 10 of the 76 years.

A middle-of-the-road portfolio of 50 percent stocks and 50 percent bonds produced average returns of 8.7 percent a year. The biggest annual loss was 22.5 percent, and the portfolio suffered losses in 17 of 76 years.

The most aggressive portfolio, 100 percent stocks, returned 10.7 percent a year, lost 43.1 percent in its worst year and had losses in 22 of 76 years.

If you invested $10,000 today at the lowest of those returns, 6.7 percent, you’d have $33,304 after 20 years. By earning 8.7 percent a year you’d have $53,038, while 10.7 percent would get you $76,375.

But if you were unlucky enough to suffer the biggest historical loss each portfolio incurred, and to suffer it in the final year, the conservative portfolio would leave you with $31,073, the middle one $41,098 and the aggressive one $43,457.

Obviously, asset allocation has to be done with great care.

If you’re a do-it-yourselfer, play with several of these programs, and go through each questionnaire several times with different answers. That will give you sense of how each factor affects results. Also read the supporting material for a clearer idea of what risk really means.

Help available

The Vanguard program is under Planning & Advice at www.vanguard.com. Fidelity’s is under Planning & Retirement at www.fidelity.com. Morningstar Inc., the fund-tracking company, has a good asset-allocation tool under Tools at www.morningstar.com/, and Quicken, the financial program company, has one under Portfolio at www.quicken.com.

If you’re not an Internet user, phone your mutual fund companies or broker, as most have brochures and workbooks on the subject.

If all this is daunting, hire a financial adviser. I prefer the fee-only type who sets up a long-term plan for a flat or hourly rate and does not sell products. Their trade group, the National Association of Personal Financial Advisors, has a referral service on its Web site, www.napfa.org. Or call (800) 366-2732.