In portfolio management, the manager should see what theme they are picking. For example, in the case of Force Motors, the theme was luxury vehicles in India will grow to a very large extent and then go into data crunching like it happened in China…which will give an idea of what kind of numbers can come for BMWs and other luxury cars in India….and if Force Motors is the only supplier for that, how it gets benefitted. This needs to be done for all the stocks the portfolio manager is planning to invest in.
The indisputable fact that effective portfolio management permits investors to develop the simplest investment set up that matches their income, age and risk taking capability, thus makes it essential. With good investment portfolio management, investors will cut back their risks effectively and avail customized solutions against their investment-oriented problems. It is, thus, one amongst the inherent elements of undertaking any investment venture.