Question

"Portfolio evolution provide a feedback mechanism for improving the entire portfolio management process" Explain

Answer 1

Yes , it is true that portfolio evolution provide a feedback mechanism for improving the entire portfolio management as due to the portfolio evolution process , we can find the weakness of the various stocks which are available in our portfolio. We can note the trends of each and every type of securities such as equity shares, preference shares, debentures, bonds etc. Moreover , we can find potential investment which will give us maximum return in future . It also leads to the portfolio diversification which helps in minimization of risks that are associated with our portfolio's securities.

Performance of companies varies from time to time. So we should know the right time of investing , transfer of an investment. Portfolio evolution helps a lot in that process.