Determine Your Approach

In determining what your approach will be for monitoring your portfolio, ask yourself the following:

  • What is your target allocation for each asset class (stocks, bonds, and cash)?
  • How often will you monitor your portfolio?
  • How will you determine how well your individual investments are doing?
  • How will you determine how well your overall portfolio is doing?
  • Is the portfolio meeting your expected return?
  • What fundamental criteria will you focus on as you review your holdings?

Based on that information, you'll also want to determine the criteria you will use to decide how often you want to rebalance your portfolio.

As you can see, tracking a portfolio means more than just monitoring its performance. It means keeping an eye on the portfolio's characteristics, too. And it requires you to make sure that the fundamentals of your individual investments haven't changed since you bought them.

Read Next: Monitoring the Characteristics of Your Portfolio

Bonds involve risks including, but not limited to interest rate risk, reinvestment risk, inflation risk, call risk, liquidity risk and a risk of loss of principal. New issue offerings are sold by prospectus or offering circular available at Investors should read these carefully.