Portfolio Plan Introduction
The portfolio management involves the management of the investment portfolio in order to optimize the investment assets and earn the maximum profit possible. The proper portfolio management also helps to reduce the risk factors involved in the investment.
The portfolio management typically regulates as which asset to be included in the portfolio. As the goal of the investment portfolio is set, the portfolio should be managed in such a way that the investments in the various assets earn maximum profit. With the ever changing nature of the financial market and economy, portfolio management decides on which assets should be included and which not.
The successful management of portfolio makes sure that the investments are spread evenly depending on their risks involved.
The various investments that are available in the portfolio should contain all types of investments like stocks, bonds and mutual funds. A well managed portfolio should be balanced and should contain the investments with various levels of risks involved in the investments.
The portfolio management needs to take care of the asset allocation properly. Asset allocation is the decisive factor behind the successful portfolio management as it decides what proportion of the investment should be made in stocks, bonds or currency. Active asset allocation and passive asset allocation are the two types of asset allocations while the active asset allocation depends on the market views.
Last Updated on : 8th July 2013