Terms used in trade such as Product Portfolio,Product,Production Sharing,Professional Liability,Profit,profit margin etc

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Investors willing to take higher risks to generate market-beating returns may create a concentrated portfolio. To overcome the challenges of diversifying your investments, you can invest through WealthDesk, a platform for retail investors to invest in portfolios curated by SEBI registered professionals. Internal factors – product differentiation, the company’s market share, assets, R & D services, customer loyalty programmes etc. The GE matrix is a 9-box matrix which helps corporations to evaluate their business portfolios and prioritize investments among their diversified units in a systematic manner. You tend to diversify or spread your risks across products and business units.

Have you ever wondered how do they decide which apps to continue, which ones to kill, which ones to invest in? Let’s find out the answers to these questions in this article- BCG matrix of Google. Firstly, the ‘filling’ part refers to adding more products/items to existing range of products and offer more options. The objective here might be to boost profits, satisfying channel demands or being a full-fledged leader in that product category. Observe that the Biscuits have 3 different kinds of products or brands under itself.

If your portfolio has a combination of shares, bonds, cash, and other investment instruments, it is diversified. If you can stomach riskier investments, you can invest a larger percentage in higher risk, higher reward assets. On the other hand, if you are more product portfolio means risk-averse, you need to diversify your portfolio to insulate your investments better. You are often told not to put all your eggs in one basket when investing. If anything untoward happened to the basket of stocks, you wouldn’t have to lose all your eggs.

If your portfolio is below the curve then it means you are not getting adequate return for the risk taken. If it is above the curve then it means you are getting more returns than justified by risk. That kind of situation is not sustainable and you need to be wary of such portfolios. The degree of concentration of your portfolio highly depends on your investment objective.

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Tamal graduated as an Electronics & Communication engineer from Meghnad Saha Institute of Technology, Kolkata. He has worked as an Assistant System Engineer in the CPG domain at Tata Consultancy Services , Hyderabad for 22 months. Along with being a marketing enthusiast, he also has great interest in product management & strategy. Ultimately, you will have a thorough understanding of the motives behind companies reshuffling their product portfolio.

• The GE Matrix fits perfectly in the analysis of the product portfolios of a company.
• It ought to set up a strategy to make the most of its customer insights and market demand & weed out under-performing product lines.
• What are the characteristics of an optimal portfolio and how to create an optimal portfolio?
• Moreover, if you are still confused about the length, width & depth of a product line, let us consider an imaginary FMCG brand ABC.
• Investors can further generate higher returns on their investment in stock by selling the same at a higher price.

India is one of the top 5 retail markets in the world and retail trade holds about 10% of our GDP. Reliance Group, led by Dhirubhai Ambani, started back in 1966 and was mainly functioning in the infrastructure, power and communications sector. For them, the idea is to move away from the instability that this product brings to their balance sheet every other year when they win or lose the government tender.

A portfolio manager works closely with clients to translate financial objectives into profitable investments that can yield returns. They work on creating impactful investment strategies that match the client;s financial goals. They create reports on investment performance, communicate with clients on asset diversification and analyze risk management processes.

The portfolio manager is better positioned to make informed decisions for investments in securities as opposed to a layman. A Portfolio is just a collection of different types of financial assets. Assets can be anything that adds to your net worth, such as bonds, stocks, cash, cash equivalents, and funds like mutual funds and exchange-traded funds. An Investor’s portfolio can also include some non-tradable securities, private investment, and real estate. Portfolios are managed by the financial professionals, or an individual investor can also manage their portfolio.

The Aggressive Portfolio

The performance of a well-diversified portfolio does not depend on any one asset class, sector, or stock. With a risk-return profile in place, the next step is to create an asset allocation strategy that is diversified and structured for maximum returns. Now, adjust the plan to consider significant life changes, like buying a home or retiring. The investor has to choose whether to opt active management, which might include professionally-managed mutual funds, or passive management, which might consist of ETFs that track specific indexes.

After understanding the financial goals and objectives of an investor, the portfolio manager provides the appropriate investment solution. The role played by the portfolio manager is indeed a https://1investing.in/ challenging, responsible and answerable one. That is the reason why with the hierarchy across the portfolio management team, the responsibility, as well as the remuneration, is decently high.

With real estate in a contractionary state of affairs, equities have witnessed a significant uptick in investment. Mutual funds have been unable to perform consistently, and PMSes have stepped in to gain market share. Investors who were traditionally seen investing in real estate have now resorted to PMS schemes. The Balanced Portfolio – most of the investors use this approach to balance the risk and return by investing in stocks and bonds. Portfolio management is all about picking the right set of assets to lose as little money as possible on your investments and make as much money as possible.

What can we Infer from the GE Matrix?

At WealthDesk, we help you have a well-diversified portfolio by enabling you to invest in WealthBaskets. WealthBaskets are the combinations of stocks and ETFs managed by SEBI registered professionals and reflect an idea, theme, or investment strategy. Diversification of a portfolio refers to investing in various asset classes within a single portfolio. It allows investors to earn higher returns while minimising the risk of investing. A well-diversified portfolio is defined as one that minimises the risk while optimising the returns.

The more experienced the fund manager the more is the weight given to these managers and accordingly place them in a good demanding position in terms of salaries. If to scale it, these run from lakhs to crores as per the market and individual experience. All the pay packages totally depend on the experience and the returns earned for the investors in good or bad times. PMS is a facility offered by a fund manager with the intent to attain the required rate of return, given a desired level of risk.

Also, if you want to invest for the long term, it’s best not to make decisions based on short-term market changes. In other words, you shouldn’t sell your stocks just because they went down temporarily. Diversify- Diversifying your holdings across different market categories is a good idea for investing in the stock market.

When you invest in PMS, you own individual securities unlike a mutual fund investor, who owns units of the fund. You have the freedom and flexibility to tailor your portfolio to address personal preferences and financial goals. Although portfolio managers may oversee hundreds of portfolios, your account may be unique. Portfolio Management Service is a facility offered by a portfolio manager with the intent to achieve the required rate of return within the desired level of risk. An investment portfolio can be a mix of stocks, fixed income, commodities, real estate, other structured products, and cash. A portfolio manager is a licensed investment professional who specializes in analyzing the investment objectives of the investor and has a vast knowledge of the various instruments in the market.

Expert Assisted Services

Prioritise your further course of action based on the location of business unit on the GE matrix. In order to determine the industry attractiveness, first shortlist the factors that will determine the attractiveness of the Industry. We have discussed them in this blog, so you can refer some of those factors.

The fund manager takes decisions on the basis of the hardcore research that is company specific as well as market-related done by the team of the portfolio managers. The length, depth, width of a product line or the product portfolio of a brand is a strategic and significant dimension of brand building. Marketeers often find it hard to realise the intricacies behind brands adopting new products and gradually phasing out other products. In this article, you can hope to gain a clearer picture about these concepts, and I plan to explain it with the help of real-life examples for better results. Darpan is a Marketing Strategist & Consultant by profession and a blogger by hobby.

Tax Considerations

Other than this, investors’ financial goal is another important factor that influences the portfolio allocation. To elaborate, those with long-term goals are more likely to invest in long-term investment options like – equity funds, ULIPS, stocks, debt mutual funds. Alternatively, those with short-term goals tend to prefer liquid mutual funds, recurring deposits, government bonds, treasury bills and more. Diversification is an investment strategy in which investors choose to spread the risk by investing across various stocks, sectors, or asset classes.