Building a Personalized Portfolio

There's more to successful portfolio building than picking good investments. Putting together a portfolio of securities is like building a home. Even if a house is filled with beautiful rooms, that may not be enough; all those rooms need to work together to form a pleasing and useful whole. Investment portfolios are the same way.

Here are five steps for you to consider to help build a personalized portfolio composed of investments that work together as a team. The articles below (click on the headlines to read each one) discuss each step in detail and provide information about the tools available inside your Scottrade account to help you along the way.

Step One: Create a Strategy

Just as building a home begins with a blueprint, you might benefit from having a blueprint for your portfolio. The blueprint helps tell the builder to develop a structure of a particular size and shape, with specific features, to suit the needs of its future owners. Similarly, your portfolio should suit your needs and specifications.

Step Two: Discover What You Already Own

Maybe you can name all of your stocks and funds off the top of your head and detail how each one performed last week. But can you explain how they work together? Are you diversified? Does your portfolio have a lot of overlap? You need to be able to answer those questions before you can see how (or even if) your portfolio fits your strategy.

Step Three: Make Your Portfolio Align With Your Strategy

Once you know what you own, it's time to find out whether your current portfolio fits the strategy you created. This could be one of the strategies offered in Scottrade Portfolio Review Tool's Target Models. Our Target Models make it easier for you to adopt a strategy that meets your needs and works toward your investment goals.

Step Four: Schedule a Time to Rebalance

Over time, your investments can rise or fall, making your portfolio no longer aligned with your goals and needs. One way to get it back in alignment is by periodically rebalancing your portfolio to your desired strategy.

Step Five: Monitor Your Investments

You might want to periodically review whether your investments are still filling their original roles in your portfolio. This article can help you figure out what types of things you should be looking for while you evaluate your investments.

These five steps, which can be implemented through our Portfolio Review Tool, offer you a way to take control of your portfolio and help you achieve your investment goals.