Cookie Policy

We use cookies on our website and have placed these on your computer. By continuing to use our website you consent to this. For more information, including how to change your cookie settings and to disable our non-essential Google Analytics cookies, please refer to our Cookie Policy. If you do not wish to be reminded of this on each visit, please use the close button.

Spring clean your portfolio in 5

March 2019


Tags: Investing Strategies

Spring has arrived early this year and after the turmoil of late 2018, it makes sense to give your investment portfolio a spring clean: is it ship-shape for the year ahead?

Here are five questions to ask yourself:

If you were starting from scratch, would everything in your portfolio be there?

There is a danger that if you don’t re-examine your portfolio from time to time, you end up with a random selection of yesterday's investment ideas rather than a coherent portfolio that works to meet your long-term goals.

If certain areas have performed very well, they can end up with a disproportionate weighting in your portfolio. Recent years have seen markets dominated by a number of large global technology names. It is good investment practice not to let those names grow to too large a share of your portfolio – with all the associated risks - but to take profits occasionally and recycle the money into areas that might have more growth potential. At the same time, resist the temptation to ‘fall in love’ with companies. Ask yourself whether you would buy it again today, at today’s price.

Resist the temptation to ‘fall in love’ with companies

Have your circumstances changed?

Your personal circumstances will change from time to time: you may change job or receive a windfall; you may get married, have children or retire. All or none of these may require action, but it should at least prompt a review. If you have a new, better-paying job, you may be able to add more to your monthly savings or you may be in a position to take a little more risk with your capital. If the opposite is true and you’re moving to go freelance, or start a business, you may need to switch to investments that can generate an income to provide support while you find your feet.

 

Are you likely to need money from your portfolio in the next 12 months?

If you have some big expenditure coming up, this will influence how and where you invest. If you are likely to need capital in the next 12 months, you can’t really afford to take a risk on stock markets, which tend to bounce around in the shorter-term. You should start selectively taking money out of different areas and moving it into cash at least a year ahead of when you need it.

 

Are your investments working for you?

You don’t want to chop and change every five minutes. It will cost you money in trading fees and probably won’t do your portfolio a lot of good. However, it is worth measuring the investments you hold against the wider market and their peer group to see whether they stack up. If they don’t, consider whether your original investment case still stacks up.

 

Have you spotted a great opportunity?

Markets have been volatile and, in some cases, good companies have yet to recover. In areas such as the retail sector, even the better companies have been downgraded. At the opposite end, technology stocks now appear to be on more realistic valuations. Amid the rubble, there will be opportunities and it may be a good time to see if you can pick up a bargain.

 

The smart yet simple way to begin investing

Individual Savings Accounts (ISAs) are one of the most tax efficient ways to save. But with interest rates on cash savings low, more people are looking for higher returns. 

If you are ready to plan for the long-term, a Selftrade Stocks and Shares ISA is a great place to start.

Find out more

You can start investing today through any of our account options:

Dealing Account

Access a wide range of global investments in this flexible, unrestricted account.

Find out more

Stocks and Shares ISA

Take advantage of tax free investing with our Stocks and Shares ISA today.

Find out more

Self-Invested Personal Pension (SIPP)

From great value to best-in-class, access the SIPP to suit your needs through our extensive network of providers.

Find out more

I've still got questions!

We’re on hand to help at our Customer Experience Centre on 0345 0700 720

Selftrade does not provide investment advice. This article is the authors view and is not the view or opinion of Selftrade and Selftrade accepts no liability for any loss caused as a result of the use of this information. The opinions expressed are those of the author at the time of writing and should not be interpreted as investment advice.

The value of investments can fall as well as rise and any income from them is not guaranteed and you may get back less than you invested. Past performance is not a guide to future performance. We do not provide advice or make recommendations about investments. If you have any doubts about the suitability of an investment, you should seek advice from a suitably qualified professional adviser.

Open a SIPP with Selftrade. Enjoy cashback and take control of your investments.

Earn up to £1,000 cashback on SIPP accounts opened before 30 June 2019.

Terms and conditions apply.

Find out more

If you have a Stocks and Shares ISA, make sure you get the best value for your investments. We are ranked top for price on large portfolios (Platforum, 2018).

Open an account today and we’ll cover any transfer fees up to £100.*

*T&Cs apply.

Open a Stocks & Shares ISA

Find out more