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Tuesday, August 1, 2017

Stocks portfolio management


What is a 'Portfolio'
A portfolio is a grouping of financial assets such as stocks, bonds and cash equivalents, as well as their funds counterparts, including mutual, exchange-traded and closed funds. Portfolios are held directly by investors and/or managed by financial professionals. Prudence suggests that investors should construct an investment portfolio in accordance with risk tolerance and investing objectives.
Portfolio manager


A portfolio manager is a person or group of people responsible for investing a mutual, exchange-traded or closed-end fund's assets, implementing its investment strategy and managing day-to-day portfolio trading. A portfolio manager is one of the most important factors to consider when looking at fund investing. Portfolio management can be active or passive, and historical performance records indicate that only a minority of active fund managers consistently beat the market.


Portfolio managers do extensive research to make investment decisions for a fund or group of funds under their control. They may spend the day meeting with analysts, researchers, and clients, checking the financial markets, keeping up on company news, and buying and selling investments as things change.
A portfolio manager has great influence on a fund, no matter if that fund is a closed or open mutual fund, hedge fund, venture capital fund or exchange-traded fund. The manager of the fund's portfolio will directly affect the overall returns of the fund. Portfolio managers, therefore, are usually experienced investors, brokers or traders with strong backgrounds in financial management and track records of sustained success.
Portfolio management


A Portfolio Management refers to the science of analyzing the strengths, weaknesses, opportunities and threats for performing wide range of activities related to the one’s portfolio for maximizing the return at a given risk.

Major tasks involved with Portfolio Management are as follows.


  • Taking decisions about investment mix and policy
  • Matching investments to objectives
  • Asset allocation for individuals and institution
  • Balancing risk against performance
There are basically two types of portfolio management in case of mutual and exchange-traded funds including passive and active.


  1. Passive management involves tracking of the market index or index investing.
  2. Active management involves active management of a fund’s portfolio by manager or team of managers who take research based investment decisions and decisions on individual holdings.


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