Why should you review your financial portfolio?
Your financial portfolio helps you reach your financial goals, and as an investor it is imperative to review and rebalance it periodically.
- Jun 2, 2017,
- Updated Jun 2, 2017 2:03 PM IST
Your financial portfolio helps you reach your financial goals , and as an investor it is imperative to review and rebalance it periodically.
Like every other dictum, this too is more than often ignored which can be a major setback in achieving your financial goals .
The purpose of a review and rebalance is carried out to keep your investments from drifting away from the financial target you initially set.
Additionally, changes in market lead to a dip or rise in the value of your assets thereby making your portfolio too risky or conservative. Not staying updated in a scenario like this puts you in a disadvantage.
Finally, Jasani also highlights that one should keep track of post tax returns.
This requires holding different asset classes for different periods as prescribed in the Income Tax Act.
"This period needs to be kept in mind while taking investment decisions as different asset classes undergo different cycles and it is important to enter at the right time in the cycle so as to also benefit out of the holding period necessary to qualify for LTCG and its beneficial tax treatment," says Jasani.
Financial goals are an important subset of an individual's life and therefore if a disciplined review is not maintained, it will lead to huge divergence which can become a personal liability in the long-run.
Your financial portfolio helps you reach your financial goals , and as an investor it is imperative to review and rebalance it periodically.
Like every other dictum, this too is more than often ignored which can be a major setback in achieving your financial goals .
The purpose of a review and rebalance is carried out to keep your investments from drifting away from the financial target you initially set.
Additionally, changes in market lead to a dip or rise in the value of your assets thereby making your portfolio too risky or conservative. Not staying updated in a scenario like this puts you in a disadvantage.
Finally, Jasani also highlights that one should keep track of post tax returns.
This requires holding different asset classes for different periods as prescribed in the Income Tax Act.
"This period needs to be kept in mind while taking investment decisions as different asset classes undergo different cycles and it is important to enter at the right time in the cycle so as to also benefit out of the holding period necessary to qualify for LTCG and its beneficial tax treatment," says Jasani.
Financial goals are an important subset of an individual's life and therefore if a disciplined review is not maintained, it will lead to huge divergence which can become a personal liability in the long-run.