Outlook Money
Your investment strategy may need a review when your financial goals, income, risk tolerance or portfolio allocation changes significantly over time.
Every investment should serve a specific financial goal. Without clear objectives, it can become difficult to decide investment amount, duration and suitable risk level.
Strong past returns do not guarantee future performance. Chasing investments after exceptional gains can lead to elevated valuations or more risk than you can handle.
Market movements can change your original asset allocation. A sharp rise in equities, for instance, can make your portfolio more aggressive than initially planned.
Changes in income, expenses, liabilities, marriage, home purchase, retirement plans or financial goals can alter your risk capacity and investment requirements.
A defined review process can help assess goal progress, asset allocation, risk exposure, investment costs and changes in your financial circumstances periodically.
Financial priorities can evolve with changing circumstances. An investment strategy created earlier may need adjustments when your goals, responsibilities or investment horizon change.
Revisiting your strategy is not only about market movements. Your portfolio should continue to match your financial goals, investment timeline, circumstances and risk tolerance.