<\/span><\/h3>\n\n\n\nThe evaluation of a portfolio is done over a selected period of time. It is a useful feedback loop that helps in enhancing the quality of the portfolio management process. Performance evaluation involves assessing the risks, return criteria, relative merits and demerits of the portfolio, etc.<\/p>\n\n\n\n
<\/span>Step 8: Rebalancing the portfolio<\/strong><\/span><\/h3>\n\n\n\nAfter the evaluation over a certain period of time, rebalancing of the portfolio is done to maximise returns and minimise losses. It should be performed as often as required while keeping the primary objective in mind.<\/p>\n\n\n\n
<\/span>Tips for healthy portfolio management<\/strong><\/span><\/h2>\n\n\n\n\n- Goals and strategy: <\/strong>The first step in devising an investment plan is to find out your goals. Make sure your goals are achievable. They can change over time. Hence, make sure to assess how it will impact your overall strategy. Further, keep your risk-tolerance levels always in mind.<\/li>\n\n\n\n
- Asset allocation:<\/strong> The right mix of investment types makes up for an effective asset allocation which is based on various factors like goals, risk appetite, budget, etc. Balance your portfolio in a way that you insulate it against sudden changes in the market.<\/li>\n\n\n\n
- Diversify:<\/strong> You can spread your risks by selecting investments across a broad spectrum of market categories. Diversification helps you reduce the