INVESTMENT PORTFOLIO MAGEMENT

Investment Portfolio Management is the process of strategically selecting and managing a mix of financial assets (like stocks, bonds, mutual funds, etc.) to meet specific financial goals, risk tolerance, and time horizon

Key Components of Portfolio Management

1. Asset Allocation

• Deciding how to divide your investment across different asset classes:

  • Equity (stocks, mutual funds)

  • Debt (bonds, fixed deposits)

  • Gold

  • Real estate

  • Cash equivalents

  • ✅ Example: 60% equity, 30% debt, 10% gold (based on your age, risk profile, and goals)

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2. Diversification

• Spreading investments across:

  • Sectors (IT, Pharma, FMCG, etc.)

  • Instruments (stocks, mutual funds, ETFs)

  • Geographies (India, international markets)

  • ✅ Purpose: Reduce risk without sacrificing returns

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3. Risk Management

• Identifying and adjusting for:

  • Market risk (volatility)

  • Credit risk (default)

  • Liquidity risk

  • ✅ Use tools like stop-loss, rebalancing, and hedging

  
  

4. Performance Monitoring & Rebalancing

• Regularly review your portfolio (quarterly or yearly)

• Rebalancing ensures your portfolio stays aligned with your target allocation

  • If equity rises too much, sell some to buy bonds/gold

5. Goal-Based Planning

Match your investments to specific goals:

 Types of Portfolio Management

Sample Portfolio (Moderate Risk, 30 Yrs Old, ₹10 Lakhs)