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Friday, August 19, 2016

Portfolio Management Vs Money Management

Investor need to allocate their assets. Thus with the given amount, they will need to track and control which assets they have, to increase or decrease. Even whether to keep certain percentage as money or near money.

On the other hand, traders need to track their performance. Some might not hold any position over night. Thus they do not need a portfolio to track their assets, since most or all is in money form. What they need infact is money mangement.
Money mangement help to control risk and rate performance.

There are also many case where the person is both a investor and a trader . He might have both system to help him make decision.

Its like running a company.
Property investment firm need to watch their property, loans and returns.
Business need to watch their cash flow, inventory and profit and lost.

For those that depends on investment or trading for a living, cost of living become important. Its like a expenses in business or invesment firm.

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