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How To Guide

How To Evaluate An Investment Portfolio

Learn 4 ways to evaluate your investment portfolio. Build the perfect portfolio using Cube Wealth.
December 4, 2020

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Investing in the best assets is not enough. Because what’s best for you today may not be the best for you tomorrow! Investors either realise this too late or don’t realise it at all. Assessing your portfolio periodically can help you understand if you’re gaining profits or losing money. 

You must constantly nurture your portfolio to reap the rewards of profit in the future. This blog will help you learn about 4 important ways to evaluate your existing portfolio.

4 Steps To Evaluate Your Portfolio

Step #1. Track Your Portfolio’s Performance

Check each investment’s returns and compare it to other schemes from the same category. This will help you understand how your investments are doing. 

But it’s important to note that you shouldn’t compare apples to oranges. Comparing a stock to gold or a mutual fund scheme to P2P lending won’t get you anywhere. 

Instead, you can check your overall portfolio performance to gain insight. A wealth coach can do a financial check-up of your existing portfolio. Book a free consultation call here.

You can use our free MF analysis tool to evaluate the health of your mutual fund portfolio yourself. 

Step #2. Check Your Portfolio Allocation

Your portfolio allocation should have an ideal mix of diverse investment options like stocks, mutual funds, ETFs, gold, p2p lending, and more. A diverse portfolio may have a better chance of giving better returns over the long term while lowering the risk.  

Portfolio allocation may vary depending on factors like your investment goals, age, and risk profile. Even market trends may impact your portfolio allocation. 

Example: For stock allocation, you can follow this golden rule: Subtract your age from 100. Whatever remains should be your stock allocation. At 30 years old, you would allocate 70% of your portfolio to stocks. But this could vary based on your goals. It would be best to speak to a wealth coach for more information.

Take our Risk Analysis Quiz and see what your Perfect Portfolio should include.  

Step #3. Identify The Fees You’re Paying

Types of investment fees that you might have to pay: 

  • Expense ratio
  • Entry load
  • Exit load
  • Advisory fees
  • Transaction Fee
  • Brokerage charges 

Pay attention to these charges since they can eat into your profits. The age-old rule applies here: lower the fees the better.  

Step #4. Assess Your Goals

Your portfolio allocation is directly linked to your goals. If it isn’t, then that is a big issue that you need to address <immediately>. Goal-based investing can give you a clear idea of what should remain or be sold from your portfolio. 

For example, it would not be ideal to invest in mutual funds to finance your MBA in the next 2 years. Mutual funds are long term investments which are known to deliver profits over 5+ years.  

A wealth coach can help you allocate your portfolio in investment options that are suitable for your goals. Otherwise, you would be shooting in the dark hoping that something would stick. 

Speak To A Cube Wealth Coach to understand this better.

How Cube Can Help You Build The Perfect Portfolio

The Cube Wealth app makes it easier for you to build the perfect portfolio of investments using Cubes bucket philosophy:

 

Sr. No.

The Bucket

Timeframe

Purpose

1.

Emergency Funds Bucket

Lifetime

Illness, job loss, major repairs, etc.

2.

Protection Fund Bucket

Lifetime

Insurance

3. 

Short Term Fund Bucket

2 to 3 years

New car, MBA, wedding, etc.

4. 

Medium Term Fund Bucket

3 to 5 years

College fees, down payment, etc.

5. 

Long Term Fund Basket

5 to 10 years

Children’s education, buying a house, etc.


Build A Perfect Portfolio Here

Every investor's goals and needs differ. Get a free consultation call with a Cube Wealth Coach today to know more about suitable investment options.

Summary

Evaluating your investment portfolio is crucial to achieving your financial goals. Timely assessments and quality feedback from a wealth coach can help you rebalance your portfolio.

The Cube Wealth app simplifies wealth creation by helping you build the perfect portfolio of investments. Generally, the complex numbers and charts for portfolio tracking can be daunting to keep a track of. Cube solves this problem with a simple portfolio tracking feature. 

Your entire portfolio is visible in one simple view and is managed by wealth coaches with decades of experience. Save time and invest in the best investment options only on the Cube Wealth app.

Here is an in-app guide for Cube's perfect portfolio feature


Shriram Shekhar
Shriram is a Consultant at CubeWealth. He has developed cutting edge IT products for over 2 years before turning to his passion for the written word. His love for philosophy, developing products, and empowering people through quality content is what got him to CubeWealth.

Top 5 Reasons To Try Our Powerful Investment App!

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  • High Quality Mutual Funds
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  • Invest in U.S. Stocks
  • Alternative Investments
  • Low Minimum Investments
Try Cube’s Exclusive Wealth Concierge Service! We offer a 10-minute portfolio analysis and set up service to select users.

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