Investment in equities can appreciate your wealth when you invest in the right stocks. However, the concept of right stocks can get confusing considering the changing global economic situation. It can increase the value of your investment as predicted or set a complete loss as unexpected! Therefore, consistently monitoring your portfolio becomes very important. When you monitor your stock portfolio and revise it timely if required over the long term, you can experience increased gains. If you have been seeking a solution to the common question, 'How can I track my investment portfolio?', here is a detail to help you better.
Before we get started, let us understand why monitoring your stock portfolio is important.
Why Monitoring Your Portfolio Is Important?
Monitoring your portfolio timely can help you achieve your financial goals by making wise financial decisions. However, it does not mean tracking your investment, checking the price and engaging in the right buy or sell option. Instead, it means understanding your stock portfolio and realising its scope for improvement to help accomplish your money goals. Here are a few pointers to elaborate on in this regard.
- Understanding the company's financial condition, investment plans, and opportunity for growth is essential to evaluate the stock value. The recent scams and their impact on stock prices is a good lesson for investors stressing the need to monitor investments timely.
- With the advancement in technology and knowledge, a single event can alter the financial picture of an industry as a whole. Therefore, you must monitor your stock portfolio timely, determine if the events impact your investment, and make wise decisions.
- When you gather knowledge while monitoring your stock portfolio, you can predict the demand and supply or the investor sentiments and make well-informed decisions.
How Can You Monitor Your Portfolio?
The sole purpose of monitoring your portfolio is to examine the stock movement, understand its scope for improvement, wait for capital appreciation, or revise your stock portfolio with better stock options. Here are a few ways you can go about doing it right!
- Keep analysing your company's performance - Several factors, such as political and economic changes worldwide, can affect your company's performance on a large scale. Therefore, keeping yourself updated on the latest announcements, news, etc., and its impact on the company's performance can help evaluate your investment value. There can be circumstances wherein there is a slight dip in the value and, however, has a high scope for improvement in the future. In such cases, you can wait, monitor, and let it appreciate.
- Keep track of the financials – Every company will provide detailed reports of their financial reports every quarter. It will have information regarding their investments, profit, and loss. You need to carefully analyse these figures to determine the financial management of the company. There can be scenarios wherein the company has declared a loss for that quarter considering a change in their business management. It is acceptable unless there is a scope for improvement considering the larger picture. On the other hand, if you find the company is declaring losses consistently, it is certainly a cause for concern. You need to analyse the background, find the reasons for such losses, and make the right decisions to secure your investment by revising your stock portfolio.
- Keep track of corporate announcements - Every company will inform the stock exchange of the major events planned in their company that can affect the stock market, such as mergers and acquisitions, changes in the board members, etc. This information is available online on the respective company websites or the stock exchanges. You can read and apprehend the information to find the company's initiatives and how they can affect the stock prices to make a better decision.
- Keep track of the pledging of shares - The shareholding pattern is a piece of important information about the company. Promoters utilise the option of pledging shares to secure the loans and manage funds for the working capital. The promoter shareholding is an important collateral for availing a loan.
Suppose the value of shares pledged with a lender reduces. In that case, the promoters must compensate for the shortfall by providing additional shares to the lenders to maintain the collateral. The lenders can sell their shares if the promoters fail to make up for the changes. It can further reduce the shareholding of the company's promoters and further the shares' value.
- Utilise emerging online applications - With the advancement in technology, financial institutions in the country, such as the stock brokers, have been providing online mobile applications to help monitor your stock portfolio and take timely decisions to secure your investment. In addition, they have been providing a clear analysis of the impact of the market conditions through simple and easy pictorial descriptions.
These simple steps can help monitor your stock portfolio for timely changes if required. Over a period, you will be able to gain knowledge about the changing market conditions and their impact on your stock portfolio.
Investing in stocks and monitoring the portfolio can help increase your wealth in the long term. However, you can also consider saving in policies to increase your wealth while securing your family's financial future in your absence. Comprehensive life insurance plans such as the ULIP plan provides a life cover and an option to invest in financial securities based on your risk appetite. You can purchase life insurance online, monitor your stock portfolio, and switch between fund options when a situation demands. In addition, our TATA AIA Life Insurance provides various product options with customisable features online to help maximise your financial benefits.
Stock market investment can appreciate your wealth. However, you should monitor your stock portfolio on time to ensure your investment is on the right track. While a dip in value may be common for a brief term, your investment should be in the right direction for capital appreciation. You can monitor your portfolio by keeping track of the company's performance, financials, etc., by utilising the different emerging mobile applications from a trusted source. Investments can yield apt returns only when it is monitored and revised timely!