Portfolio creation

You need to first identify your investment objectives and preferences in order to determine an appropriate asset allocation strategy with suitable mutual fund and segregated fund recommendations. An optimum mix of different and distinct fund categories plays a critical role in establishing an effective and diversified portfolio. This asset allocation mix is determined by several factors: investment stage of life cycle (accumulation or decumulation), portfolio size, time horizon, total return objectives and risk tolerance.

Rebalancing your mutual fund and / or segregated fund portfolio on a regular basis maintains the desired asset allocation in your investment strategy -- it is one of the important keys for effective risk management. Rebalancing should be a standard operating procedure for every investor since it is relatively easy to restore a portfolio to its original allocation mix. Regardless of your objectives and risk tolerance, the major benefit of periodic risk management is significant reduction in portfolio volatility.