Balanced Portfolio Management Strategy
Balanced investing strategies are portfolio management strategies, which are most widely followed by investors. Balanced portfolio management strategy combines the merits of both aggressive and defensive strategies; so that both return and risks are balanced. This strategy suits almost all types of investors who are good in money management and have reasonable risk tolerance.
The key of a balanced portfolio management strategy is the diversification of portfolio. Balanced investing portfolio consists of both low-risk low-return fixed income securities like treasury notes and bonds, and high-risk high-return equity and mutual fund investments. Portfolio may also include investments in precious metals, real-estate, money market investments, cash etc. Balanced portfolio management strategy allows investors to actively control one portion of their portfolio by adopting different investment strategies; and allow the other portion to grow naturally.
Balanced portfolio management strategy is good for medium-term financial goals, usually for 3-5 years. With respect to the portion of portfolio allocated it can be slightly aggressive or defensive. But for enough diversification, the portfolio size must be fairly larger. The success of the strategy greatly depends on the investor’s ability to choose the right products for investment.
The key of a balanced portfolio management strategy is the diversification of portfolio. Balanced investing portfolio consists of both low-risk low-return fixed income securities like treasury notes and bonds, and high-risk high-return equity and mutual fund investments. Portfolio may also include investments in precious metals, real-estate, money market investments, cash etc. Balanced portfolio management strategy allows investors to actively control one portion of their portfolio by adopting different investment strategies; and allow the other portion to grow naturally.
Balanced portfolio management strategy is good for medium-term financial goals, usually for 3-5 years. With respect to the portion of portfolio allocated it can be slightly aggressive or defensive. But for enough diversification, the portfolio size must be fairly larger. The success of the strategy greatly depends on the investor’s ability to choose the right products for investment.
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posted by Daniel Pipitone at
4:53 AM
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