Hamilton Finance:What is Portfolio Analysis?
What is Portfolio Analysis?
Author: Ayaz Haider
Portfolio means a group of investments of various forms under control of an institution or an individual managing privately. Main purpose is to hold them by taking owner ship of assets, to a certain amount of time in appreciation of retaining their value.
When a financial institution or a large scale company decides to make an investment portfolio they arrange for portfolio analysis in-house. That is not standard for the small investor; they might go for financial service providers who provide portfolio analysis services. Many of them are available online.
Portfolio analysis are use to make a decision regarding sale or purchase of assets; type, quantity and time period. That decision involves study of stock performance, ROI, and provision of risk. But it is always made sure that decision is in accordance with owners target and economic conditions.
There are many factors that influence in portfolio analysis; they can be categorized into the following two.
Effects related to market on portfolio:
1. Market size, growth and profitability.
2. Pricing trends; bullish, bearish or horizontal.
3. Competition with the rivals.
4. Estimation of risk.
5. Acceptance of new product.
6. Product distribution channel.
Competitive strength effect on portfolio:
1. Market standing of asset.
2. Support from other brands in group.
3. Share in the market.
4. Satisfaction of customer
5. Products completion with rivals.
6. Own channel of distribution.
Portfolio analysis also focuses on the return on investment. There are many ways that companies adopt at their will to calculate, like monthly or quarterly. Mostly they use "Money Weighted Return" and "Time Weighted Return".
Portfolio analysis is an entirely devoted field of financial research and analysis. For individuals it is recommended to consult with an expert analyst or firm, because they are dedicated and technicaly more competent. ISource Biz is one the firms that provides complete solutions related investment research including portfolio analysis.
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