Question

1. we need a strategy in our life to construct an investment portfolio? What is the step in the portfolio to construct?

Answer 1

Yes we need a proper strategy in our life to construct an investment portfolio because it depends on many factor our risk and return profile and at the same time there are other factors like age, our requirement and other factors.

Steps in the portfolio to construct:

Step 1: Determine risk and return objective of the client.

Step 2: Strategic Asset allocation: as per the risk and return and objective assign the asset in the different percentage at the different section.

Step 3: Fund Selection: Then we should select the individual fund which we think can outperform the market and give higher return .

Step 4: Construction of portfolio: after identify the weight of different asset and fund we construct the portfolio using this information.

Step 5: Rebalancing of portfolio: Once we construct the portfolio then we should rebalance the portfolio at the regular intervals to make sure the portfolio generate good return.