What makes an effective investment portfolio?


Investment portfolios are often as individual as the people they belong to. Portfolios can reflect the ethics of an investor, but also whether they are financially cautious or adventurous. What makes a portfolio effective depends largely on the investor’s financial goals. Read on as we look at some key considerations when assessing if a portfolio is working.

Personal aims

Portfolio managers will first assess an investor’s personal financial aims and determine how much risk they find acceptable. This is the foundation of evaluating effectiveness. Setting goals allows accurate measurement of how close they are to being achieved, while attitude to risk dictates how aims are met.

Receiving a second opinion

Over time, people’s financial circumstances and plans can alter. To discover if a portfolio is still effective, an independent eye is sometimes required. By comparing original expectations of investments to how they perform, wealth managers can identify if they are meeting their targets.

Diversity makes for robust portfolios

Including a broad range of asset classes in portfolios can help spread risk. When certain investments are performing poorly, other types can earn more, balancing any loss. A balance between actively managed funds and cost-effective passive funds is often a wise strategy.

Professional portfolio management

If you’re looking for a service providing effective portfolio management around Shropshire and Chester, we can help. At Hartey Wealth Management, our team can construct a bespoke portfolio to meet your attitude towards risk and personal goals. Whether you’re looking for balance or adventure from the investments you make, contact us today.

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