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Portfolio Management

Objectives Of Portfolio Management

Previously we understood the concept of Portfolio Management now let us learn some of the objectives:

  • To choose the right kind of assets according to a person’s age, income, budget, long-term goal, risk-taking capacity, etc. 
  • Aim to provide capital appreciation through earning consistent returns. 
  • Understanding the needs of individuals and customizing their portfolio according to the investor’s preferences and objectives. 
  • Balancing risk and return optimally so that an individual obtains desired returns while staying within their risk limit. 
  • Achieve diversification of portfolio to minimize the risk of exposure in a single asset class. This also helps clients to obtain the desired liquidity. Diversification has been discussed in detail later in this module. 
  • Portfolio management may also take into account tax-saving criteria, thus investing in avenues which help an individual effectively plan their taxes. 

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Units 4/16