Article written by Sherin Dev; Follow me in Twitter or Facebook
Thinking about an investment portfolio is simple and interesting. But, having an investment portfolio is difficult. High degree of preparations, timely action on various factors, identifies time to do necessary workarounds regularly are some of the biggest tasks associated with the creation and maintenance of an investment portfolio. Another big deal is identification of present status, goals and instruments that meet all the requirements. Once dealt with all these, completed half way of the investment portfolio creation process. This article deals with the difficult parts when creating an investment portfolio. This would not go to cover all factors associated to the portfolio creation, but surly give a better insight to the areas where one certainly focus when deals with investment portfolio.
Portfolio creation should start with self assessment and status check. One should als get required knowledge on what it means and where, how to start. Must identify the goals at various duration and able to understand the instruments to meet that goals. Be aware about the risks associated to each and identify parallel solutions to meet such risks boldly. Here are some instruments that generally required in a portfolio, give you better idea when proceeding with.
Tax saving instrumentsIf you are an employee and status falls to huge tax bracket, this would be your first option. Identify best tax saving instruments that appreciate well in long time. Adding such instruments give double benefits, tax saving and growth of wealth, in the same time. Getting assistance from experts would help to identify the right instruments.
Naturally insurance products would be there in the portfolio. This would not work as an investment option but, work well as a protector of wealth and/or future. One should assess self to identify what insurance coverage you, family, assets required and from where to subscribe the same. Having policies like term insurance policies, medical insurance policies, protection policies against theft, calamities, protecting assets should be planned well and added to the portfolio to live good. Industry experienced insurance planners would give great assistance to analyze, identify right policies and vendors to meet these requirements.
Liquid and Debt instruments
Liquid and debt instruments have huge importance in the portfolio. Identifying the same is bit difficult, but through research and study, one can easily identify what he required to add in his portfolio based on requirements, goals and status. Having liquid and debt funds is an excellent way to meet immediate money requirement as it would work as a good emergency fund for you within a portfolio.
Gold is always a good investment. Considering its power to beat inflation and high market demand, investments in gold would be certainly a best idea. Once can invest in gold in the form of physical gold such as ornaments, bars and coins or in the form of Gold Exchange Traded Funds (ETF) or even adding gold mutual funds. Gold commodities are also a good option those who are more familiar with commodity markets.
Real Estate doesn’t have any capability to protect against recession and it fluctuates always. However it has its own privilege of getting high appreciation time to time. Investments in real estate are a good option for those who are creating investment portfolio for long time. Have learned from the past experiences that, real estate prices are skyrocketing moment to moment. Investors can buy real estate in the form of plots, flats, individual houses or subscribe to Real Estate Investment Trust funds (REIT). Real estate investments are also a good option for those who are not getting enough sleep by thinking about raising inflation.
Naturally, this is the best option for investors who have long term investment focus. In my personal opinion, none of the portfolios are perfect without having investments in stocks or stock related investments i.e. mutual funds, Exchange Traded funds etc. People may have enough knowledge to invest any of the instruments mentioned above but investment in stock required good study, research to get required knowledge first. One also considers his age, financial status, risk taking capacity when plans to move with direct equity investments. I have written number of best article in this blog to provide such knowledge to those who have real interest to become a direct stock investor.
Creation of an own portfolio is always a good decision to all future focused individuals. Right knowledge, home work, good analytical ability with getting advices from right people would add spices to ones portfolio to bring it as a big success. Having right goals for long, medium and short term and preparing a portfolio with right mix up to meet all that goals can be considered as a right one. Wish all the best to all who read this article and plan to have a portfolio as their own.