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How to Manage Your Investment Portfolio

How to Manage Your Investment Portfolio

When you’re investing, it makes sense to start off with a plan, but quite often we end up in a position of having some investments, but no plan. So I’m sometimes asked ‘how do I manage my investments?’

There isn’t enough scope to go into too much detail here, and anyway that’s what my Money Masterclass is for, so if you really want help then go check that out. 

But there are some basic tactics you can put in place to help you manage your investment portfolio into the future. 

Pound Cost Average

If you don’t know what this is, you can check out my blog here on the topic. 

To use this, you’re going to invest in your set percentage split of assets in equal chunks over a period of time. It might be a monthly investment, it may be splitting a lump sum into say 5 or 10 investments. 

If you could pick the absolute best time to invest, then sticking all your money in at once is the best plan. However, nobody knows the best time to invest, so save yourself the hassle and worry of trying to time the market and just drip feed your investments in. 

Compounding

It depends what stage you’re at with your investing, but assuming you’re trying to grow your investments then compounding is a very important tactic to use. 

All this means is letting the investments grow and keeping your profits in the portfolio - ideally in the same asset class - and leaving your profits to grow as well. So don’t take an income from your investments if you don’t need them just yet. 

There are different ways to do this depending on if you’re investing in property or funds or shares or anything really. 

Rebalance

When it comes to the long term management of your portfolio, then rebalancing can be the single easiest way to increase your returns over the long term. 

There is a right way and wrong way to rebalance, and while the vast majority of people don’t even do this, those that do often get it wrong anyway. 

I learnt that mistake particularly well when it ended up costing me nearly £300,000! So it’s something I absolutely drill into people I work with nowadays. 

I’ve even created a spreadsheet for my Masterclass students so they can input their portfolio and it tells them exactly what they need to do going forward. It’s rather nifty, even if I do say so myself. 

Conclusion

The fact you have a portfolio that needs managing means you’re probably further along than a simple blog can help with, that’s why it’s pretty light on detail here. 

What I think you need to understand is how to manage your risk, increase your potential returns, and lower your volatility. If you can do that, you’ve got yourself a great portfolio and portfolio management system!  

I work with people on a 1-2-1 basis as well as in my Money Masterclass to help them refine that balance of risk and reward. If you’re interested, get in touch and we can chat. 

Further Reading