Working Method
Excellence is only achievable if there is a work method. Asset management requires applying knowledge and experience in the field to the unique situation of each investor. Therefore, it is essential to know in depth its needs, finances, taxation, and the most difficult yet most important one, to clearly understand the risk willing to undertake to achieve the desired results.
Investment Strategy
Defining Objectives
Which is the ultimate goal? What is your risk tolerance?
Time Horizon
When does it need to be accomplished? The length of the investment could constitute a challenge, certainly bigger the shorter the period.
Financial Status
We must identify our starting point:
- Size, composition, and distribution of the initial investment
- Saving capacity and its forecast
- Potential financing needs in the future
The financial situation is as relevant as the length of the investment. It could mean a restriction on the strategy of the investment.
Risk Tolerance
This is the most challenging point to define due to its subjective component. However, essential to optimize the strategy and adopt the best investments decisions
Risk Profile
Once defined through the previous points, we must establish a benchmark. This will allow us to:
- Forecast expected benefits.
- Identify potential risks that we must understand and accept. In the case of lacking this step, we should review points 2 and 4 to define a new profile and select a new benchmark.*.
- Periodically assess the portfolio returns.
*Reference index.
Taxation
Critical to optimizing portfolio management. At this point, we must foresee various situations to make the best decision.
Preference and Restrictions
When identifying the preferences and limitations, we must integrate them into managing the investment. For instance, direct investment Vs. investment vehicles schemes, preferences for regular income payments Vs. accumulative investments. The type of management, a particular style, or even the restriction of any of the above mentioned.
Building a Portfolio
Always under the basis of efficiency: Risk-Benefit
Recurring assessment
This implies periodically assessing the portfolio and its performance, adjusting it to changes in terms and financial situation. In addition, the evolution of the markets and the legislative and personal changes affecting the investment make to adapt the strategy continuously.
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Life Enjoyment
Would you like more information?
In that case, we invite you to join us for a call or videoconference where we can talk further about your financial resources and how we can optimize your portfolio.