Many ladies often think about how to start investing but in actual fact, putting together an investment portfolio is pretty similar to dressing up your wardrobe. When you are looking to buy investments, financial advisers will always recommend asset allocation into different instruments based on your risk profile and age etc. Customized Wardrobe (Portfolio)
When we buy clothes, people focus on buying clothes and accessories that match our lifestyle, age group and activities they engage in.
An investment portfolio is not much different. We rely on lifestyle (risk appetite), age group (our time horizon) and activities they engage in (financial goals).
The rationale or idea behind this concept is that everyone should always take a look at what they are comfortable with given their current situation and future goals.
Let’s look at an extreme scenario of suggesting an elderly of 70 years old to plow all his retirement funds into small cap stocks. It will breach all the 3 principles of ‘buying clothes’ …