Stock Portfolios

Written by Michael Federico
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There are different ways to establish a stock portfolio. The most common is through an investment firm. A financial advisor works with a client to establish a portfolio that fits the client's needs. Stocks will be chosen based on the potential of growth and the potential of risk. Some people are interested in creating portfolios that can greatly increase in value in a short time. When this is a possibility, the opposite can occur, as well. Other people want security in a portfolio. There will always be some amount of risk, but by focusing on industries and companies that have performed consistently for long periods of time, that risk is much smaller.

Portfolios can also be established over time. A person who starts by purchasing a few shares of stock in one company can eventually add to his investment. Over time, he can build a strong portfolio simply by making solid long-term investments.

Managing Stock Portfolios

The introduction of online trading has led to online portfolio management. A person who trades online can build a stock portfolio in the same way as a person who trades through an investment firm. However, an online trader is solely responsible for managing his investments.

The software that many online trading companies use makes it quite easy for a person to manage his portfolio. He can monitor all of his stocks individually. He can also chart the growth of the entire portfolio over a certain amount of time. Some software will also let a person compare the performance of his stocks to the performance of other companies in the same industries.

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