Portfolio

A Portfolio is generally a group of financial assets held directly by investors that may include stocks, bonds, real estate, and other cash equivalents. A Portfolio of real estate investments would include all property investments that an individual owns. Considering all investments as part of a Portfolio, an investor is able to make additional investments with attributes that would balance or enhance the total results and avoid investment properties that are either performing poorly or are holding equity capital that could be invested in a property that would be more beneficial to the whole. For example, some real estate investments hold great promise for long term profitability but little for short-term net income. Other properties generate tremendous net cash flow and net income but the potential to increase the property value within five years is low or unlikely. With these properties together in a portfolio, an investor can enjoy cash income today and realize future capital gains simultaneously. The second category of benefits from a Portfolio are derived from diversification. By investing in different geographic areas and in various types of property, an investor is able to balance the risk. A careful analysis of individual real estate investments allows investors to obtain the highest returns on available investments. Real estate is uniquely not portable. Often the success or failure of a community or enterprise zone is not controllable by the investor although market trends are often predictable. Each area in which a property is owned should be studied every year to detect trend-setting events. At other times, anticipated positive developments don’t occur and knowledge of forthcoming is difficult to anticipate.