Advantages And Disadvantages Of Investment Strategy: Portfolio Allocation
Investment Style: There are different investment strategies which can be followed in order to formulate any investment decision. Every investment strategy has its own advantages and disadvantages. Some of the most common investment strategies include risk averse investment strategy, portfolio investment strategy, value investing investment strategy, asset allocation investment strategy, individual investment strategy, and many more. Some of these investment strategies are implemented at long term while some of these investment strategies are implemented in short term. Usually, a period of less than one year is considered to be a short term period while a period of more than one year is considered to be a long term period. As this project was having a timeline of short term period, that is why short term investment strategies has been used in this project. The most commonly used short term investment strategy …show more content…
If an amount is kept by a person in a bank amount in order to earn interest on it then that person will not be able to grow his or her amount while in case of portfolio investment, the earning capacity is enhanced significantly. Investor can formulate a portfolio investment of short term and long term securities. Mixture of short term and long term securities allows the investor to have balanced and better approach towards capital gains.
Most of the traditional securities selection demands extensive securities analysis while in case of portfolio investment, the security analysis is minimum. Traditional security analysis requires extensive data and resources in order to select appropriate security for investment while in case of portfolio investment, a significant amount of time is saved. Traditional security analysis mostly requires a three step analysis involving economy analysis, industry analysis, and company analysis.