It can be important to put an emphasis on stock portfolio tracking, because you’ll want to keep an eye on how your investments are doing. 

Here are some things to look for when tracking your portfolio. 

Asset Allocation 

This tool will allow you to combine investments in for your portfolio, which may include stocks, bonds or cash based on your goals and risk tolerance. In fact, it’s the blend of asset classes that will most efficiently optimize your investing plan. A more aggressive mix — meaning a higher percentage devoted to stocks than bonds — is likely to produce higher returns over time, but with the greater risk of short-term losses.

Each asset class carriers differing degrees of expected return and risk. Each may perform differently than one another over time. In the ideal case, your asset classes would not be correlated. Further, your asset allocation will likely change through life as your tolerance for risk changes. You might adjust your allocation as you become closer to retirement and need to preserve capital.

Diversification 

Diversification is crucial for holding a mix of securities within each asset class that vary by industry, sector, geographic location and other differentiating factors. Owning a diverse portfolio of investments is an important way to manage risk.

Further, a security could be any number of things, including a stock, a bond, real estate investment trust, a certificate of deposit, a mutual fund, or an exchange-traded fund.

A diversified mutual fund or exchange-traded fund will also lessen your risk of your whole portfolio folding. In other words, you don’t put all your eggs in one basket.

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