Building An Investment Portfolio

Building An Investment Portfolio | investment

The reason for putting a portfolio together is to reflect on future needs for capital and income and to give peace of mind that the desired outcome will be achieved without undue risk.

The first decision is with regard to Asset Allocation, which is simply explained as the amount of money invested in each of the asset classes. There are many asset classes such as stocks and shares, government gilts, corporate bonds, property, commodities, cash etc.

Although there are many Asset Classes it is universally agreed that most will fall into four main categories mainly cash, fixed interest, equities and property. Most other asset classes that individuals will come across are really sub-classes of these four.

The main benefits of having a spread of investments within these four asset classes is the understanding that the classes do not mirror each other's movements, up or down, i.e
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