Portfolio Analysis

When is the last time you gave your entire investment portfolio a detailed analysis?

Bird Dog Investor

If you are a bird dog investor, you are sniffing out those charts daily for any decrease or increase, ready to take any necessary action.  Or maybe you are a “buy& holder” and like to check your accounts every day just to know that your acorns are buried safely despite any external excitement.

Snooze Hound Investor

Do you have investment analysis paralysis?  Do you avoid the official investment portfolio review out of fear of being like the guy next door who owned way too much of Enron stock when they went bankrupt?  Are you nervous about news like Detroit bonds being  downgraded to a CCC rating of junk bond status meaning they may never be paid back?  Or are you the type that is just simply too busy working overtime, raising kids or being a social superstar to do a proper investment portfolio review?   Do you have straggler accounts at a company that doesn’t know you moved to Hawaii and you have no idea where your user id and password are located?  Not paying attention is another popular reason for investment portfolio trouble. It may be time to wake up and embrace your testosterone like a pit bull protecting her territory, face your reality, and deal with it.

If you are investment savvy, evaluate your portfolio yourself.  First, remind yourself of your goals and strategy. If you are coming up blank, then it’s time to determine what your goals are and how you are going to accomplish them.   Compare this to what’s going on in your portfolio.  What is happening with your funds’ performance?   Are you diversified enough?  Do your allocation amounts still make sense?  Does transferring money from individual stocks to a mutual fund make sense?  Should you have more money in bonds?  Are you allocating the maximum amount to your retirement accounts for tax advantages?  Find an excellent checklist from financial advisors to help you through the process.  There are online tools offered by companies like Fidelity that will help you do your own investment portfolio analysis.

Financial Advisor

Otherwise, get with your financial advisor to make sure that your investment choices still make sense for you based on performance, your current situation and your risk tolerance. You may be tempted to accept an offer for a “free financial portfolio review” from a financial advisor at an investment company.   Just know that the purpose of the review is to bring you in as a customer to make money off of you.  Going this route could very well pay off if you land an excellent advisor, but it’s important for you to understand  that sometimes the newer advisors with less experience are doing the free reviews so they can build their customer base.   When the MoneyDogz were pups, they suckered for a free review with an inexperienced advisor at a big name investment company.  They chose not to sign up with this company, and received repeated follow up phone calls for 6 months.

However you accomplish your annual investment portfolio review, just make sure it happens. Staying on top of your financial situation greatly increases your chances of reaching your financial goals.