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Financial Planning
Portfolio Management

Portfolio Management

When you buy an investment, you acquire something that necessarily changes in value over time. However, there are ways to influence, if not control, how your investments perform through various portfolio management techniques. Here are some core concepts related to portfolio management that underlie an effective investment strategy, regardless of your personal circumstances. Speak to a CIBC Wood Gundy Investment Advisor on how these and others apply to you and how you can make the most of them.

Asset Allocation

Asset allocation – how your investment portfolio is structured by investment type, duration, amount, etc. – is, as an authoritative investment industry source put it: "the primary determinant of returns." Selecting the right allocation of assets and adjusting them to changing conditions can put you on the right path to meeting your financial goals. It's also an important strategy for reducing risk.

Diversification

Diversification – i.e., choosing a variety of investment vehicles with different performance characteristics to achieve a better overall return – is the essence of asset allocation. Diversification reduces fluctuations in the value of individual investments: some highs may be forsaken to avoid some lows.

Managing Risk

Managing risk means more than just avoiding an investment loss. It also means outpacing inflation and being able to capture possible gains. Risk arises from different factors – some controllable, some not – but risk can be managed. A well-constructed investment strategy can improve your ability to keep risk in check.

Managing Reward

With rewards come responsibilities and obligations. For example, realizing positive returns usually results in the obligation to pay tax. However, not all investments are taxed alike: some get preferential treatment. Also, a loss in one investment may offset a gain from another. These are key considerations in devising a sound investment strategy.

Use our Find An Advisor tool to locate a CIBC Wood Gundy Investment Advisor near you and take the first step to achieving the financial future you want.

The information contained herein is considered accurate at the time of posting. CIBC and CIBC World Markets Inc. reserve the right to change any of it without prior notice. It is for general information purposes only.

Clients are advised to seek advice regarding their particular circumstances from their personal tax advisors.


CIBC Wood Gundy is a division of CIBC World Markets Inc., a subsidiary of CIBC and a Member of the Canadian Investor Protection Fund and Investment Industry Regulatory Organization of Canada.