Reviewing Your Portfolio: Tips for Beginners

Making investments profitable is a challenge even for the best investors. If you are trying to manage your own investment portfolio then you need to make it a priority in your financial life. It is essential to review your portfolio at least four times a year, or quarterly. This will keep you in the loop in regards to how your investments are doing, and it will also enable you to make periodic adjustments to your investment plan of action.

When to Review Your Portfolio

Many people leave their investment portfolio in the hands of a financial advisor and do not think much about how their money is being invested until they want to use the money. However, by this time it is too late to make changes that could improve your returns. For the best results you need to review your portfolio on a regular basis, at least once a year if you have a financial manager and more often if you are managing your portfolio yourself.

In addition to regularly scheduled reviews of your portfolio you will also want to take a look at it when major market changes are predicted or experienced. This will allow you to make adjustments that will help your investments survive downturns and to improve your returns when an upturn is expected.

Understand Your Position

The strategies that you use to orchestrate your investment activities need to be based on your financial position. This position is comprised of factors such as your age, the amount of money you make in a year, the stability of your employment, the stability of the economy and the financial goals that you have. Obviously when one or more of these factors change your investing strategies also need to change to compliment and balance your financial position with your investment portfolio.

Understand Your Investments

It is important not to invest blindly in companies and investment products that you do not know about. Since your financial future is directly tied to your investments you need to know who you are working with in order to protect your interests. Investment research is something that you need to do when you are reviewing your portfolio. Even if you have done research on the companies that you have invested in previously, it is a good idea to regularly review your company profiles and to see what new developments may be influencing their current and their future performance.

References

https://www.americancentury.com/investment_planning/manage_your_portfolio.jsp