Investors should practise disciplined investing along with a diversified portfolio. The diversification of portfolio is a prerequisite to receive good returns from the market in the long run. Due to fluctuations in the market, investors may lose about 80% in the market before reacting to the situation. Thus, Investors can rely on the diversification as a suitable offense for best defence. Generally, a well-diversified portfolio along with an investment horizon for a time period of three to five years can survive major upheavals in the markets.

Investing can be rewarding, informative and educational; if one follows the below mentioned steps.

· Disciplined approach

· Using diversification

· Buy-and-hold

· Dollar-cost-averaging strategies

Spreading out the investments

Investors should invest in the equities as they provide great returns, however it is strictly advised to not put all of your money in the investments of one stock or specified sector. It is recommended that investor should create his/her own virtual mutual fund by making investments in few companies that are doing well and trustworthy. It is good to make the investments in the companies you know well or whose goods and services you use. It is a good way of making healthy approach to one sector.

Invest in Index or Bond Funds

As an investor you should consider adding fixed-income funds or index funds to your portfolio. One of the excellent ways for long-term diversification investment is to invest in securities that track various indexes. Another way of further hedging your portfolio against market uncertainties is to add some fixed-income solutions.

Continue Building your portfolio

It is important to keep adding investments on a standard regular basis and grow your portfolio. One should avoid investing the Lump-sum amount in volatile or uncertain market conditions. This strategy of investing helps in smoothing out the peaks and valleys produced by volatile market conditions. Thus, as an investor, one should invest money regularly into a specified portfolio of funds/stocks.

Aware of the time to Exit

It is mandatory for a smart investor to know when to exit the market. Some of the sound strategies of managing portfolios are dollar-cost averaging, purchasing, and holding. One should not ignore the fact that time to exit the market is very crucial for remaining in tune with market conditions and staying current with the market investments. One should know the current happenings in the companies you have invested in.

Be alert regarding your commissions

In case, you are not a trader, you should comprehend what you are receiving by paying fees to the firms for managing your portfolio. There are some firms that charges monthly fees while others charge transactional fees. One should be aware of the payments you are making and returns you are receiving.

Stock Portfolio Management Softwares

There are various stock management softwares available in the market that assists in process of stock management. There programs are well designed to provide assistance for those investors who are good with numbers and stocks.

Benefits of Stock Portfolio Management Softwares

· Assists in evaluation of various stocks

· Before investing, these programs educate a person about tracking the history of stocks

· Recommendations based on personal information

· Well designed to help the investor who can manage his own stock portfolio

· Some programs can do monthly analysis of stocks for a monthly fee

· Some programs can be set to buy and sell certain stocks automatically on the basis of preset conditions when the stocks reach certain levels on the stock market.

· Saves time for knowledgeable investors for managing the stock portfolios.

In addition to providing software for investor for managing his/her stock holdings, there are various contacts that are available online for offering expert advice in managing an individual’s stock shares.

The portfolio for large number of investors are managed by stock management company who have stock portfolio managers that will make the decisions for protecting the person’s initial investment and ensures its growth for good returns in future.

The stock portfolio management company handles the IRA accounts for an employer that provides options to the stock portfolio managers regarding the investment limit and certain percentage of money for investment in various kinds of stocks.

The employee who has the stock account with the company is free to ask for any modifications by submitting the written request to the company at any time. The investment firm keeps the investors away from suffering huge losses by issuing various useful recommendations from time to time. As the market dynamics changes constantly so it is not possible to avoid the losses all the time, however the amount of loss can be kept to minimum by taking the services of stock portfolio managers.

The companies owned by stockholders forms an important component of the free enterprise system and offer advantages to many people. These stockholders are eligible to take their stand on company policy decisions by the way of voting and they also share the profits or losses earned by the company. The stockholders are basically wealthy people who can bear heavy losses if any incurred during the financial crisis.

The investment in stocks is opened to anyone who would like to invest in stocks. The proper management of investment in stocks can allow the investors to receive dividends on the investment and enjoy the profits of a company. In fact, there are many companies that provide stock shares to their employees on retirement as part of their savings.

Portfolio Manager

Portfolio Manager is basically a personal stock portfolio management system that enables the traders to track the sold and bought stocks along with any related dividends by investing minimal time and effort. Traders can maintain a complete stock trading diary without need to update a spreadsheet continually. This information is of utmost importance for improving the trading strategy.

Traders can view the performance of their portfolio anytime throughout the year. Traders can have the knowledge of their current status of their portfolio by analysing the statistics on open trades as well as historical trades.

With portfolio managers, traders can generate easy to use reports without any hassle and paperwork. It also allows them to make savings by avoiding the accountant fees.

Advantages of Portfolio Manager

· Easy to use wizards that allows quick and simplified data entry.

· Auto or manual stock price updates

· Management of multiple Portfolios

· Tracking of all the stock transactions and related dividends

· Enables the traders to sell shares for gaining maximum tax benefits

· Facility of optional accounts that allows the traders to track total used funds and available funds

· Incorporates the information regarding the trading plan like disaster stops targets etc

· Allows the traders to maintain Trade diary for storing any extra information

· Generates quick and easily available reports

· Ensures data security as the portfolio is stored on individual’s PC only

Personal Stock Monitor

Personal Stock Monitor is basically a portfolio management system by CollabInvest(sm) and Integrated Trading. It allows the traders to manage all of their investment accounts, holdings and watchlists in one place. Traders can work together with their friends in realtime. It also allows the traders to do tracking, trading and research more opportunities quickly. Investors can make quick and better decisions by easily available analysis.

Personal Stock Monitor provides following benefits for the investors.

· New stock screener support

· Portfolio management and reports

· Script extensions and customization

· Technical analysis with custom indicators

· Up-to-the-minute news and research

· Streaming real-time quotes and charts

· Easy chart and portfolio sharing

· Receive trade confirmations

· Alerts, including email and SMS

· Place live orders

Investar

Investar is a Stock Portfolio Management Software that offers wide range of benefits for anyone who likes to invest in Indian Stock Market including Portfolio Managers, Broker, Chartered Accountant, Technical Analyst, Short-Term/Long-Term Trader, Day Trader, student, and any other individual Investor.

Benefits for Traders

· Traders can get new Stock Ideas daily and analyze the fundamentals for selecting the stocks for investing.

· Traders can make correct decisions about buying or selling by analyzing the Technical aspects.

· Enables the traders to import transactions effortlessly from the broker and continuously track the portfolio.

· Traders can utilise the portfolio technical view for keeping track of the technical pictures of all the Portfolio Holdings.

· Traders can improve his/her buy/sell timings with the help from portfolio Buys/Sells on the Chart.

· Traders can utilize effective Money Management principles by applying Portfolio Alerts and Stop Losses.

Scoring Methods

There are two commonly used methods of Scoring including Simple Additive Weighting (SAW) and Weight Product Method.

Simple Additive Weighting (SAW) Method

It is considered to be the best know method that is most widely used technique in portfolio management. It employs regular arithmetical operations including multiplication and addition. In this method, the attribute values are both numerical and comparable.

Weight Product Method

This method does not involve transformation when we multiplication is used among attribute values. The weights turn out to be exponents linked with each attribute value. It assigns negative power for cost attributes and positive power for benefit attributes.

Steps for deriving Scores and weights

The process of deriving weights and scores can be summarised as mentioned below.

· Identifying the applicable non-monetary attributes

· Weight the attributes for reflecting their comparative importance

· Scoring the alternatives for reflecting how each option performs against each attribute

· Calculation of the weighted scores

· Testing the results for accuracy

· Interpretation of the obtained results

Benefits of scoring techniques

Scoring techniques signify an improvement over traditional ratio analysis that is dependent on the remote use of certain ratios. By using scoring techniques, the problem of the attaching relative importance to each ratio is solved as each is weighted based on its ability.

Drawbacks of Scoring techniques

Along with various benefits, the scoring techniques also have various shortcomings. In a scoring equation, the statistical underpinnings may give rise to certain weaknesses. It is imperative to have a sufficient large sample, accurate database and consistent long period in order to reveal trends in the company’s behaviour and measuring its impact.

Features of Scoring Techniques

· The scoring equation is usually based on historical data from recent past and requires to be updated over time. The same equation cannot be used many years later when there is considerable change in financial environment in which companies operate. It is thus imperative for scoring equations to remain updated.

· The scoring equations are designed for measuring the risk of failure for small and medium-sized companies. However, these equations do not serve other purposes like they do not predict about the profitability of the companies in advance. Moreover, they do not measure the risk of failure for big groups. Scoring equations can only be used for companies whose size and business activities are at par with those included in the original sample.

· Scoring technique is the simple and quick way of synthesising figures and these techniques exhibit considerable appeal. The development of scoring methods may lead to mean self-fulfilling effects. The scoring techniques are aimed at providing prior knowledge of the risks of failure. It assists the companies to take required preventive measures.

Bubble Diagram

A bubble diagram represents a famous variant of portfolio mapping that employs a circle or ellipse for identification of every project in place of a single point. The extra information related to the analogous project is provided by varying the shape, size, colour or shading of the circle. For instance, the shape of the circle may be used for representing the initial costs of the project.

The risk-reward portfolio mapping involves keeping the projects into various categories as per the quadrant they fall into. It is followed by labelling of the 4 quadrants of the diagram as shown below.

· Pearls: They have high probability of success and generate high payoffs

· Oysters: They are long shots, but with high payoffs

· Bread & Butter: They are low-risk projects with low rewards

· White Elephants: They are low probability and low payoff projects

Portfolio mapping tools acts as useful devices for displaying the attributes of projects, however they do not offer basis for making decisions regarding how to trade off those attributes. Moreover, they do not tell what balance among the various attributes is best for the project portfolio.

Portfolio Planning Matrix

The portfolio planning matrix is the graphical tool used by large companies for analyzing and managing their portfolios of SBUs (strategic business units). The company’s SBU’s are located within the cells of the matrix in this tool. The results assist the companies in making decisions regarding the investments to be received by SBU’s. It also assists in identification of the businesses that should be leftover and addition of new businesses to the portfolio.

The portfolio planning matrix is also called as BCG Growth-Share Matrix. It was developed by the Boston Consulting Group (BCG) in the 1970′s. This version represents four quadrants of the matrix that representing low versus high opportunities for growth and low versus high levels of market share.

In this tool, the identification and placement of company’s SBU’s in the matrix is done as mentioned below.

· Cash Cows : Mature SBU’s that yield excess cash due to their dominant market shares in slow-growth markets are kept in the lower left quadrant. These are labelled as Cash Cows.

· Stars : Mature SBUs that eat up cash and have good potential due to their high shares of high-growth markets are kept in the upper right quadrant. These are labelled as Stars.

· Question Marks: SBU’s that needs cash to stay workable and have low shares of high-growth markets are kept in the upper right cell. They are labelled as question marks.

· Dogs : SBU’s that simply yield enough cash to break even and have low shares of low-growth markets are kept in the lower right quadrant. These are labelled as Dogs.

The basic objective of Project Portfolio Management is the determination of the optimal mix and proper sequencing of proposed projects in order to achieve the overall goals of organization.

It takes into account various factors such as business strategy goals, hard economic measures or technical strategy goals.

The project portfolio management involves the analysis of various attributes of projects as mentioned below.

· Project’s total expected cost

· Consumption of scarce resources

· Expected timeline

· Schedule of investment

· Expected nature

· Magnitude of benefits

· Timing of benefits to be realized

· Relationship or inter-dependencies with other projects

There are various vendors of PPM software that highlight ability of their products to treat projects as part of entire investment portfolio. PPM focuses on management of project portfolio as an informal approach for project investment decision making.

There are various PPM tools that enable companies in managing the continuous flow of projects from beginning of concept to its completion. There are many PPM tools and methods that provide techniques and technologies for allowing improvement, visibility, measurement and standardization of process.

Decision Trees

One of the popular PPM tools is decision trees with decision nodes that allow multiple options and enable the project managers to optimize project against a constraint.

Decision centric view

A decision centric view is an approach for including uncertainty and risk in portfolio optimization. There are five key decisions that are made while taking decision centric view of the project portfolio optimization process.

· Decision D1: It includes making decisions about strategic initiatives, benefits, and resource limitation criteria that are used for portfolio ranking and project filtering.

· Decision D2: It includes making decisions about criteria that are important to achieve.

· Decision D3: It includes making decisions regarding the project ideas that can be developed into business cases.

· Decision D4: It includes making decisions about the Business Cases that should be considered as element of the portfolio.

· Decision D5: It includes making decisions about the projects that should be funded.

Resource allocation

Resource allocation makes up a significant constituent of PPM. The available resources of a company is evaluated for its capability to fulfil the demands of project once it is determined that project or projects meet defined objectives. The resource allocation can be done effectively by funding resource commitments, funding the skills available in the resource pool and understanding of existing labour. The project investment must be made in projects where the required resources are available during a particular time period.

Pipeline Management

Pipeline Management involves the determination of various ways for executing a set of projects

in the portfolio in a specified time; given there are only finite development resources in the organisation. The pipeline management relies on the ability of the project managers to measure the planned allocation of development resources as per the strategic plan.

Atlantic Global Project Portfolio Management Software

Atlantic Global PLC is a famous Project Portfolio Management Software provider that improves the set up, communication and delivery of projects across the organisation. This project portfolio software allows the companies to get benefitted by providing following advantages.

· Achievement of long-standing strategic objectives

· Better communication of information

· Greater organisational efficiency

· Securing the investment in portfolio

· Optimisation of resources

· Maximise business opportunities

· Real-time business critical information

This software enables the following functionality across various sections.

Demand Planning

· Create Weekly and Monthly Demand

· Forecast Resource Demand

· Quickly input Multiple Demand Lines

· Import Demand

· Copy Demand from existing Forecasts

Expenditure Planning

· Input Weekly or Monthly Expenditure

· Forecast Project expenditure

· Quickly input Multiple Expenditure Lines

· Copy Expenditure from existing Forecasts

Resource Management

· Claim Supplied Resources

· Analyse Resource Allocations by Project

· Allocate Resources

· Analyse Resource Capability

Financial Management

· Manually input Project Budgets

· Create Budgets on the basis of Resource and Expenditure Forecasts

· Forecast Resource Demand and Expenditure

· Create multiple Budget versions

· Create Baseline Budgets

Daptiv Project Portfolio Management Software

Daptiv is considered as the leading on-demand PPM solution that has more than 80,000 subscribers. It provides assistance to various companies in improving the execution of their strategic planning. It offers flexible PPM solutions along with professional services by experts.

Popular Daptiv PPM Solutions

· Daptiv PPM for IT: It offers a widespread set of tools that allows the companies to manage their IT portfolio along with the maintenance of balance between IT initiatives and business priorities continuously.

· Daptiv PPM for Enterprise PMO: It assists companies with Enterprise Program Management Offices (EPMO) to manage work holistically and align strategically across the company.

· Daptiv PPM for PMO: It assists companies with Program Management Offices (EPMO) in the management of their risks, resources, budget and schedule across numerous projects.

· Daptiv PPM for Small and Medium Sized Business (SMB): It assists the smaller companies in managing the projects and enhances the teamwork for achieving business success.

Project.net project portfolio management software

Project.net is a Web Based Project Management Software that maximizes the productivity of any company by assisting in tracking a portfolio of projects as well as single project. It addresses the requirements of complete project including portfolio managers, project managers, team members and executives. It offers accurate information on the status of all the projects in the portfolio and delivers the real-time reporting for tracking the distributed projects.

Empower Teams: It empowers project team members by providing the complete project workspace for logging and managing their individual contributions.

Drive Collaboration: It incorporates various unified social media tools that enable information sharing across the project life cycle.

Maximize Accountability: It enables the Project Managers to track the progress of projects with exceptional accountability and keeps them on tight budget and schedule.

The management team actively manages the product portfolios by taking decisions regarding the development of new products, modifying existing products or discontinue any other products. The addition of new products helps in diversifying the investments and investment risks.

Objectives of Product Portfolio Management

There are various methods adopted by firms for implementing the product portfolio management; however there are some common goals that every company tries to achieve by product portfolio management.

Value Maximization

The product portfolio management involves allocation of resources for maximizing the value of the portfolio through a number of key objectives like ROI, profitability, and acceptable risk. A variety of procedures are used for achieving this objective of value maximization that ranges from financial procedures to scoring models.

Balance

Product portfolio management involves achievement of desired balance of projects by considering various parameters.

· Risk versus return

· Short-term versus long-term

· Business arenas and technologies

In order to reveal balance, there are various methods used such as bubble diagrams, histograms and pie charts.

Business Strategy Alignment

The portfolio of projects should reflect product innovation strategy of the organization and that the expenditures and spending should be in line with strategic priorities of the organization.

There are three main approaches used for alignment of business strategy.

· Top-down (strategic buckets)

· Bottom-up (effective gate keeping and decision criteria)

· Top-down and bottom-up (strategic check)

Pipeline Balance

In order to achieve the proper balance between the demands of various projects in pipeline and available resources, the pipeline balance and management is done in the product portfolio management. The objective is to avoid pipeline gridlock caused by the presence of many projects with little resources at any given time.

Approaches for pipeline management

· Rank ordered priority list

· Resource supply and demand assessment

Sufficiency

Investors should ensure that revenue (or profit) targets that are formulated during the product innovation strategy should be achievable and feasible. It is done by conducting a financial analysis of potential future value of pipeline.

Challenges of Product Portfolio Management

There are various challenges that confront product portfolio management that reflects the weaknesses in the strategy of product portfolio management.

· Projects are not low value to the business

· Product Portfolio has a poor balance

· Resource breakdown not as per the product innovation strategy

· Inefficiency in ranking and prioritizing projects

· Poor balance between the resources available and number of projects

· Projects not aligned with the business strategy

Advantages of Product Portfolio Management

With proper implementation of the Product portfolio management, organisation can reap huge benefits in the long run.

· Building a strong link between project selection and business strategy

· Achieving efficient and effective allocation of scarce resources

· Communicating priorities

· Achieving balance

· Maximizing the return on various product innovation investments

· Enabling objective project selection

· Achieving focus in activities

· Maintaining the competitive position of organisation

Benefits of PPM Studio

Competitive evaluation of projects investments

PPM Studio enables the portfolio managers to evaluate the competitive project investments by implementing the PPM Studio Project Governance Framework. Project Portfolio Manager assist the companies in setting up this project governance framework that ensures that any project investment shall be comprehensively analysed in terms of capacity available , business objectives , risks involved, budget required, Return On Investment(ROI), etc. It also allows the PM Managers to rank the portfolio investments among all the competing investments. This exercise is performed for ensuring that vital projects should be accepted and executed.

Enables Real-time visibility across the Portfolio

PM Studio enables the real-time visibility of the projects across the Portfolio. The Key Performance Indicators (KPI) are used for analysing the real time portfolio health for taking corrective and informed decisions on time. It also allows keeping the projects in the portfolio on track to meet the defined objectives.

Enhancing the utilization of resources by using ERP

PPM Studio allows the portfolio managers to use Enterprise Resource Planning tools for enhancing the utilization of resources. It offers clear visibility of resource allocation and its utilization through the projects and business units. The optimal utilization of resource capability is ensured by the skill based resource allocation.

Pipeline Management

PPM Studio Portfolio Manager helps in the determination of ways for executing the projects in the portfolio in a specified time. As there are many projects in the portfolio and limited resources are available for their implementation. Therefore it is important to have a proper pipeline management of the projects in place to ensure that only the best and worthy projects are selected and executed.

PPM Studio enables the portfolio managers in maintaining the projects pipeline for measuring the planned resource allocation and utilization as per the defined strategic plan. The projects execution can be done on the basis of strategic value, business benefits and criticality.

Best Practices

PPM Studio offers the best practices for efficient managements of projects in the portfolio. It enables the portfolio managers to select, execute, monitor and delivery the projects on time. PPM Studio complies with numerous project management methodologies that are widely followed across the world. The portfolio managers can also configure workflows that are specific to the organization.

Efficient Project Portfolio Management

· Allows the portfolio management to organise the projects in groups and leveraging appropriate staff for building a efficient project team

· Leads to the completion on projects on time and there are no project delays due to lack of enough resources

· Effective utilisation of the key project contributors so that they are available on time for executing the projects

· Project status remain stable for longer duration

· Cooperation between various departments and sub-organizations for achieving the portfolio goals by using available resources

A project portfolio is managed by the project portfolio manager who looks for various ways that led to the improvement in the return on investment. A project portfolio manager has to be specialist in its field and he should constantly monitor and evaluate the portfolio with the passage of time to ensure that portfolio is giving high returns at low risks.

Every organization should have a project portfolio manager to take care of the portfolio management. A portfolio manager does the regular analysis and assessment of portfolio performances in terms of risk and returns over a period of time. Portfolio Management is goal-driven and target oriented task and there are inherent risks involved in the managing a portfolio.

Some of the major tasks involved with Portfolio Management include Matching investments to objectives, balancing risk against performance, taking decisions about investment mix and policy and allocating assets for individuals and institution.

Roles of Project Portfolio Management

· Determination of a viable project mix that meets the target of the organization

· Ensuring a mix of projects that balance various factors such as research versus development, short term versus long term, risk versus reward, etc

· Regular monitoring of the planning and execution of the optimal selected projects

· Evaluating the performance of portfolio and various ways for improving it

· Analysing the recent opportunity against the existing portfolio

· Comparing the project execution capacity of the organisation

· Providing recommendations to decision makers at every level of the process management

There has been increasing awareness among the organizations regarding the improvement of project portfolio management process for making it more efficient. In many companies the improvement of project portfolio has become part of the organizational learning process.

Project portfolio can be improved by following the below mentioned steps.

· Collecting and reporting the initial portfolio information

· Establishing the goals of portfolio

· Developing the resource and asset portfolios

· Linking project goals, resource and asset portfolios

· Performing an initial assessment

· Determining the multi-project strategic resource of the organization

· Prioritizing the project portfolio as per the accepted criteria and available information

· Assessing the portfolio balance

· Developing the recommendations for enhancing the ROI (Return of the Investment)

· Facilitating the Governance Board meeting

· Communicate the relevant information to various departments

The proper project portfolio management works wonders for the growth and development of the organisation. The selection of the right methods for choosing the right projects is a big challenge and portfolio management enables the organisation to proactively take all the required measures that yield high returns at a given level of risk.