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investing

Portfolio

A collection of investments held by an investor.

A portfolio is the complete collection of financial investments held by an individual or entity, including stocks, bonds, mutual funds, ETFs, real estate, and cash. Portfolio construction involves balancing risk and return based on investment goals, time horizon, and risk tolerance. Regular rebalancing maintains the desired asset allocation as market values change.

Example

A business owner's retirement portfolio contains 60% stock ETFs, 25% bond funds, 10% real estate investment trusts, and 5% cash—rebalanced annually to maintain these targets.

Why It Matters for Your Business

How you structure your investment portfolio determines your long-term wealth building, retirement readiness, and ability to weather market downturns.

Practical Tips

  • •Rebalance your portfolio at least annually to maintain your target asset allocation.
  • •Increase bond allocation as you approach retirement to reduce volatility risk.

More Investing Terms

Dividend

A distribution of profits to shareholders.

Stock

A share of ownership in a company.

Bond

A debt security where the issuer owes the holder payment.

Mutual Fund

An investment vehicle pooling money from many investors.

ETF

Exchange-Traded Fund - a tradable investment fund.

Related Financial Guides & Resources

Accounting 101 GuideFinancial Statements GuideTax Deductions GuideFinancial Reports Feature

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