Module: 3 - Portfolio Investment Process
(Page: 2 of 3)

A. Planning

The aspect of portfolio management is the most important element of proper portfolio investment and speculation. In the planning stage, a careful review should be conducted of the investor's financial situation and current capital market conditions. Investor and capital market conditions are blended in order to determine a set of investment and speculative policies as well as a long-run strategic asset allocation.

Portfolio Planning Stage figure-2

In the implementation stage, three decisions need to be made, if the percentage holdings of various classes are currently different from the desired holdings. The implementation stage is shown as follows: