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Surviving a Zombie Portfolio

SURVIVING A ZOMBIE PORTFOLIQ FIND QUT HOW TO SPOT AN INVESTMENT ZOMBIE IN YOUR PORTFOLIO AND COUNTER THE DAMAGE! HIPSTER ZOMBIE Fashionable but not necessarily performing as well as you had hoped. HOW TO IDENTIFY: Full of "trendy" funds, recommended by pundits, experts and fund managers, and advertised everywhere! But buying a collection of "fad" funds could mean a portfolio that lacks sub- stance. SURVIVAL TACTIC: O Create a balanced portfolio based on risk, asset allocation and cost - not the latest fads Remember your portfolio should reflect your savings goals. Belinda Carlisle CD Monitor your investments regularly for any changes. If you do buy fashionable funds, make sure they work well together as a portfolio THE TIMEBOMB An inadvertently high risk portfolio. HOW TO IDENTIFY: If you have no idea what the risk level of your portfolio is, then it could be a ticking time bomb without you knowing. For instance, you could have invested in a number of high-risk funds without realise how risky they were. SURVIVAL TACTIC: O Understand your risk level O Reduce your risk level if necessary O Create a balanced portfolio - diversification is key Clippers THE RECENTLY BITTEN Could recent events have an impact on your investments? HOW TO IDENTIFY: Market or even world events, such as a war, an oil spill or a recession, can affect your portfolio. Your portfolio could have been bitten - but that doesn't necessarily mean it's infected. SURVIVAL TACTIC: O Firstly don't panic - you knew investing was not without risks, but here's how to limit the damage: Vaccinate your portfolio against infection by rebalancing at least once a year. Antidote O Ward off the infection if your portfolio has been bitten by reviewing regularly. O Remember that investing is for the long term few people experience losses over a 10 year period THE CANNIBAL The market is on the up, but your portfolio is not. HOW TO IDENTIFY: This insatiable zombie is usually made up of costly funds, which are eating away at the overall per- formance of your portfolio. SURVIVAL TACTIC: O Work out the total cost of each of your investments O Compare cost and performance to similar investments. Marmite THE MUTANT You bought a portfolio several years ago, but now it doesn't look anything like when you first bought it. HOW TO IDENTIFY: If you find yourself saying "My portfolio looks different", then your portfolio may be affected by asset drift - as different sectors have moved up and down, your portfolio is no longer invested in the same proportions as when yoU started out. SURVIVAL TACTIC: O Review and rebalance - reset the invest- ments in your portfolio back to their origi- nal percentages, and also reset your risk level and asset allocation back to what they were Taser O A good rule of thumb is to review your portfolio once or twice a year, and rebal- ance if your asset allocation is out by 5% or more. BROUGHT TO YOU BY rplan

Surviving a Zombie Portfolio

shared by rplan_chris on Nov 01
Is there something wrong about your investment portfolio? The living dead lurking in super-risky, under-performing funds and costly fees? Understand how to spot different zombies in your portfolio and...



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