Building your own stock portfolio is the way to go if you want to express your own views on security selection or sector weights, says Ayako Yoshioka, senior portfolio manager at Wealth Enhancement Group.
How to start a stock portfolio? Follow these tips step-by-step:– Carve out some study time.– Know your goal.– Diversify.– Have an exit strategy.– Keep taxes in mind.– Keep your options open.
A solid stock portfolio takes time, research, and homework. You won't have a professional money manager choosing which stocks to buy and when to sell.
Yoshioka says you must know your goal before buying stocks.
Your portfolio should span multiple sectors and geographies. Yoshioka:
Having an exit strategy is essential to successful investing, even before you've built a portfolio.
"Finally, consider the account's tax status, as trades will have tax implications," Yoshioka says.
"Investors with the time and passion to research individual stocks and companies may benefit more," says Yoshioka.