Just as a garden will fail to thrive if it is neglected, an investment portfolio will underperform if investors take a laissez-faire approach to their finances. Like gardeners, investors must put time and effort into growing their portfolios and sowing the seeds for future success.
Any gardener worth their salt knows that rooting out the weeds will help their flowers to bloom. Investors also know the importance of keeping on top of their portfolios, digging out any perennially underperforming funds and planting more lucrative ones in their place. For those with new money to invest, carefully choosing new funds to add to their crop could really reap rewards.
Keeping an eye on your portfolio’s growth and continually making small adjustments will ensure that it remains balanced and representative of both your current and long-term financial goals. For example, if your risk appetite changes, your portfolio will need to be pruned and trimmed to match. In order to ensure you’re fully benefiting from any potential tax allowances, profits may be taken at certain points of the year.
Any plant becomes overgrown over time, no matter how perfectly it was originally shaped. To avoid the same happening to your portfolio, regular reviews of the allocation of different asset classes, such as equities, bonds, property and cash will need to take place. After re-evaluating, you may find a trimming back of certain assets is needed to maintain the perfect balance.
To keep a garden lush and flourishing all year round, professional help is sometimes needed, and it’s beneficial for investors to consider seeking advice as well. We’re here to help you keep your portfolio blooming.
The value of investments and income from them may go down. You may not get back the original amount invested.