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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