portfolio management process

2. WHAT IS
PORTFOLIO?
MEANING
Portfolio is a financial
term denoting a
collection of investments
held by an investment
company, hedge fund,
financial institution or
individual.
DEFINITION : The
term portfolio refers to
any collection of
financial assets such as
cash.
Stock
X
Stock
Y
Stock X
and
Stock Y
Comprises
a portfolio

3. MEANING:
Portfolio management refers to the
professional management of securities and other
assets. Also referred to as "asset management" and
"wealth management."

4. DEFINITION :
The art and science of
making decisions about investment mix
and policy, matching investments to
objectives, asset allocation for individuals
and institutions, and balancing risk
against performance.

5. MEANING :
 The portfolio management process is
the process an investor takes to aid him in
meeting his investment goals.
 A policy statement is the statement that
contains the investor's goals and constraints
as it relates to his investments.

6. Planning Step
• Understanding client
needs
• Preparing an investment
policy statement (IPS)
Execution Step
• Asset allocation
• Security analysis
• Portfolio construction
Feedback Step
• Portfolio monitoring and
rebalancing
• Portfolio measurement
and reporting

7. The procedure is as follows:
Create a Policy Statement -A policy statement is the statement
that contains the investor's goals and constraints as it relates to his
investments.
Develop an Investment Strategy - This entails creating a strategy
that combines the investor's goals and objectives with current
financial market and economic conditions.
Implement the Plan Created -This entails putting the investment
strategy to work, investing in a portfolio that meets the client's
goals and constraint requirements.
Monitor and Update the Plan -Both markets and investors' needs
change as time changes. As such, it is important to monitor for
these changes as they occur and to update the plan to adjust for
the changes that have occurred.