Thursday, 22 April 2010

Your investment goals determine which stocks to include in your portfolio

The investment goals you have established are another important ingredient in determining which stocks to include in your portfolio.

  • If your investment goals are primarily long-term in nature, you should build a stock portfolio that is best able to meet these long-term goals.  Choose the stocks of companies that have good long-term growth prospects.  
  • If your main investment goal is to enjoy a stable source of current income, you should own stocks that pay liberal but secure dividends.  

Keep in mind that constructing a portfolio of stocks that meets your investment goals does not lessen the need to maintain a diversified portfolio.

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