Evaluation and Controlling Of the Stock Portfolio

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Those who put together their share portfolio without setting themselves a concrete goal cannot improve their investment strategy in the long term and run the risk of not optimally exploiting securities. That’s why the following steps are useful:

Investors should periodically calculate and analyze the key performance indicators, Yield, Drawdown, Sharpe Ratio, MAR Ratio, Value-at-Risk, Volatility, Number or Frequency of Trades, of their stock portfolio. This is the only way to show weaknesses and the dealer knows if the risk he has incurred so far is proportionate to the profit. For the UBS Yield Enhancement Strategy this is important.

If the measures suggest that individual features of the portfolio could be improved, investors should find and remedy the cause. Whether the measures taken are successful should be closely monitored in the following months.

It is also a good idea to set the maximum loss and maximum return for each security before it is purchased. The most common mistake of private investors is to hold stocks too long in the case of loss and too short in the case of profit. At the same time, it is not uncommon for investors to become greedy and not sell at the right time. Who sets these numbers in advance and stick to it, can outsmart his psyche and optimize the profits.

UBS Yield Enhancement Strategy

Be Independent of Tips

A stock should never be bought just because it has been recommended. This is especially true …