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Investing Insights: Investment Strategy

Estimated reading time: 2 minutes

Have you got an investment strategy?

An investment strategy is your plan that outlines how you will be allocating your financial resources to achieve your investment objectives. It is a critical component of managing your portfolio effectively and will help to reduce the emotional aspect of investing as the investment strategy introduces a systematic approach to decision-making.

Investment Strategy

The investment strategy will focus on how you plan to invest your funds. It will incorporate your Investment Philosophy which will outline how much risk you will be taking (governed by your risk tolerance), what asset classes and the breakdown of these and what investment styles you will be investing in.

A comprehensive investment strategy will also consider future conditions and when you will rebalance, when to review the strategy, liquidity needs, costs of the portfolio as well as what structures you are investing in.

Many investors will have a rough investment plan in their head, but there is significant benefit in having a plan in place and on paper. Being able to clearly articulate the plan and revisit it will help you to remain rational as well as take advantage or avoid mistakes when the financial markets are not rational. A clear investment strategy and plan will help you to maximise your chances of success.

If you need assistance in creating an investment strategy, at MLS Financial, we have the expertise to assist you in developing your very own investment strategy. We can help you to look at your holistic financial situation and develop a strategy to help you to reach your goals.

Author: Harrison Trippett


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