All participants in the stock market are owners of securities, the totality of which is called a portfolio. A securities portfolio is any securities (stocks of all types, bonds and other documents) that constitute a certain aggregate and belong to one person (physical or legal).
As a rule, a securities portfolio contains financial documents of various levels and issuers. This is done to provide greater security and protection against possible losses. Holders consolidates in their portfolio often diametrically opposed securities of various companies and organizations. The portfolio structure is completely dependent on the policy of its owner. The portfolio of securities of the company is also being formed.
Securities are a market in which it is important to have an intuitive sense of profit. The securities portfolio of an individual owner has similarities with portfolios of other owners. They consist in the initial choice of the direction of work and the committees according to certain criteria.
Investor behavior may vary. The case of portfolio formation considered above is called protective. In other words, a protective portfolio of securities is formed from documents whose estimated rate is characterized by relative unreliability. Such a portfolio, as a rule, is low-yield.
A counterweight to this approach is an aggressive portfolio of securities - this is a certain set of acquired documents, the owner of which expects a sharp increase in the rate of exchange . However, such expectations are only predictable, so the formation of an aggressive portfolio is always fraught with serious risks. You need to understand that the greater the chances of getting fast money, the greater the likelihood of getting into the illiquid zone.
A balanced securities portfolio is a formed set of securities, which, according to the investor, rationally combines reliability, liquidity and profitability.
The choice of investor strategy is determined by the state of the market and his personal beliefs. In the market, a portfolio is an independent product. The main principles of forming a low-risk portfolio are as follows. This is the principle of conservatism (possible risks are covered by income from reliable investments and assets), the principle of diversification (estimated low income on part of the securities can be offset by higher income on the other part), the principle of sufficient liquidity (the share of quickly realized income should not be lower than the level sufficient for current highly profitable transactions).
An optimal portfolio of securities consists of those assets that are characterized by minimal risk in comparison with other types of portfolios. A measure of risk is a standard deviation that characterizes the probability of a deviation of the profitability level from the expected value. Risk and expected return are two essential parameters of any portfolio.
Today, the Russian securities market is developing quite rapidly. New stock markets appear, new securities are issued, and the annual volume of transactions with them is growing. In such an environment, the policy of forming the optimal portfolio becomes the most reasonable behavior. There is a certain mathematical model that allows you to find the optimal portfolio structure. With its help, you can calculate the amount that should be invested in the portfolio. The mathematical model allows you to see the ratio of stocks to expected earnings in percentage terms.
There are two approaches to the selection of securities - a technical and fundamental analysis. The first is related to the study of prices, the second to the general economic situation.