Reasons Your Portfolio is Not PerformingReasons Your Portfolio Is Not Performing

Many investors feel frustrated because their portfolio is not performing at the level they want it to. There are many factors that play into your portfolio’s performance. In this article, we will go over four reasons your portfolio may not be performing.


One of the biggest inhibitors in our own impatience. Many of us expect amazing results, almost instantly. While amazing things occasionally happen overnight, that is not the case for the average person. Most portfolios need a good amount of time, so you have enough data to truly evaluate the performance. Impatience can cause you to sell abruptly during a low time and unnecessarily lose money. Selling abruptly can also have disastrous effects on your taxes.

You Pay High Fees

Another huge performance detractor is high fees. These fees include investment management fees, trade commission charges, and mutual fund fees. Many investors are unaware of just how much they are paying in fees. A lot of mutual funds have invisible fees, meaning they are not listed as line items in your statements. Brokers will do the same thing. So, it is very important to carefully analyze your statements and make changes if necessary.

Emotions Take Control

It is hard to do, but it is very important to keep your emotions out of investing. Allowing your emotions to take over can cause you to make decisions that negatively affect your portfolio performance. Every investor needs to remember that the market is highly volatile and can change dramatically from day to day. If you want to invest you need to be able to wait out the bad times. No one can predict the market but keeping your emotions out of it will help you minimize your losses.

You Are Not Diversified

Any successful portfolio needs to be properly diversified. Diversification is having the proper mix of assets, such as stock, bonds, and cash. Your diversification should be based on your risk tolerance and your time horizon (how long you have to invest). A well-balanced portfolio will help you to protect yourself against down swings in the market. Your investment advisor should be able to work up portfolio options that will best work for your unique situation.

Getting Your Portfolio to Perform

If your portfolio is not performing as you would like it to, the above suggestions should help you to better your performance. However, it is important to remember that the change may not be instantaneous. It is something that will take time, effort and patience to perfect.

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