Why Asset Management Is So Important In An Investment?

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Why Asset Management is so important in an
investment?
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• If you have been tracking the Indian stock market
  for a while, you would understand just how
  topsy-turvy it can get. It is absolutely critical
  to monitor and notice the rising and falling
  trends in the stock market. The surge can be the
  highest thing for a while and before you know it
  it could be completely down. Many of the
  investors were thrilled one day and dejected as
  can be the next, with a common thought where
  did I go wrong?

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Equity investment is a key factor in every
portfolio

• The no brainer is that equity investment is a key
  factor in every portfolio. You would never find a
  portfolio that does not have a fair bit of
  investment in the stock market. Everyone wants to
  invest here because of past success stories and
  it is only when there is a crash that people back
  off. So, the best idea would be to follow the
  theory of asset allocation when you are investing
  in the stock market.

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How does this work?

• Lets start

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Number 1

• It is as simple as planning to have diversity in
  your investments. The moment you have clarity in
  where you are investing this works. The need to
  have a portfolio where you have divided the
  investment into not only companies, but sectors
  and even market capital. What this does is that
  your investment objective is also split across
  different risk appetites. When you have this
  split equivalently, your risks are also split
  proportionately.

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Number 2

• So, if you were to invest in a sector that
  depends heavily on the farmer market and there is
  a drought that year, you could be having a heavy
  loss but if you have split your investment into
  an IT firm that is growing well you have cut your
  loss immediately. The whole idea is to reduce the
  volatility in the market by investing in
  different sources.

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Number 3

• At the same time, asset management means putting
  money in the same sector across different market
  cap segments. This means you can invest in a
  small IT firm and even an MNC at the same time
  looking at the growth in the sector and not at
  the company alone. There would be benefits of
  putting money in a blue chip, but the returns and
  risk are possibly higher when you invest in a
  smaller firm.

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BIG CONCEPT

• Understand assets allocation

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Track and understand our returns with different
aspects

• It is also important to track and understand our
  returns with different aspects, the simplest way
  to answer this is by asking yourself why do you
  want to invest? It could be for a wedding, your
  retirement or childs education. The importance
  of this is with the kind of timelines you are
  working with. When you have this planned out, you
  have to follow a specific time period. It could
  even make sense to split your investment across
  different channels too like equity, mutual
  funds and even bonds. If you are looking at a
  childs marriage in the next 15 years, it does
  make better sense to invest in a longer term
  instrument.

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Create an asset plan

• To create an asset plan, you need one of the best
  wealth management experts. They would be able to
  guide you best based on your requirements and
  goals. This apart, they would know your appetite
  for risk and how far you are willing to go to
  make that profit. Each person has a different
  risk factor and appetite and it is senseless to
  have a common plan for all. You need to analyse
  your requirements and then plan out the best kind
  of allocation in terms of investment. The right
  wealth management solutions need to be coupled
  with constant inputs and growth points analysis
  of each growing sector and this can be done by
  experts only.

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Investing in the stock market

• If you have been thinking of investing in the
  stock market there would not be a better time.
  There is plenty of growth points at the moment
  and you should only be looking at a diversified
  portfolio. Look at having the best wealth
  managers by your side to guide you towards making
  and reaching your profit goals.

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A picture is worth a thousand words

• In the end, having a strong portfolio is quite a
  tough task, so put your mind into it and go as
  deep as possible in to a companys financials
  before taking a call of investing in them.

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