After implementing portfolio strategies, the monitoring process begins. This includes monitoring the investments and measuring the asset’s performance relative to benchmarks. It is necessary to report investment performance at regular intervals at least annually. Then an investor’s situation and goals get a review to determine if there have been any significant changes. The portfolio review then determines if the allocation is still on target to track the investor’s risk-reward profile.
When investing for lifelong goals, the portfolio planning process never stops. As investors move through their life stages, changes may occur, such as estate needs, health, business, births, divorce, deaths or shrinking time horizons, any of which may require adjustments to goals, risk profile or asset allocation. As changes occur, or as market or economic conditions dictate, the portfolio planning process begins anew, following each of the these steps to ensure that the right investment strategy is in place.