Archive for October, 2011

How to determine the suitability of an investment portfolio?

Many investors’ existing portfolios are not well suited to accomplish their goals.  But how does one determine whether a portfolio is well constructed or poorly constructed?

I have categorized the important elements into five categories.  These broad categories are asset allocation appropriateness, diversification, security selection, investment decision-making process, and tax efficiency.  These categories are not mutually exclusive, due to the subjective nature of the task and the fact that most investment decisions have a wide range of effects and consequences. Read the rest of this entry »

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