While some investors feel financially savvy enough to manage their own portfolios, the majority need the expert advice of licensed financial planners. Choosing the optimal mix of stocks, bonds, real estate properties, mutual funds, and life insurance policies takes a combination of knowledge of how different investments work, one’s own risk tolerance, and what financial objectives you need to accomplish by a specific date. Although it is sometimes more expensive for individuals to employ the services of a financial planner, those with large sums of disposable income or those who desire guidance often turn to capital management firms.
A capital asset management firm, such as Al Masah Capital Management, invests the money of several individuals into collective funds. A financial planner meets with each client to determine the client’s financial goals. A younger investor’s primary goal is often to maximize the return or growth of the investment over a longer period. An older investor’s objective can entail preserving the value of his or her funds, with a more conservative rate of return. Typically a higher rate of return or accumulated interest earnings equates to a higher amount of risk.
Types of Investments
The most common types of investments that make up a portfolio include stocks, bonds, and mutual funds. Stocks are varied regarding risk, return rates, and costs, but stocks are usually better for those who can tolerate more risk and want higher returns. The majority of bonds are stable, but will usually result in only modest growth. Mutual funds will contain a mix of stocks and bonds, and target specific investment goals. For example, some mutual funds target specific retirement deadlines, and others target international investments.
Capital asset management firms can cater to general and specific financial needs, such as religious-based laws. Investors who desire the expertise, guidance, and convenience of a professional managing their financial goals are optimal candidates for these types of firms. Outline your investment goals, determine whether you are comfortable with a low, medium or high level of risk, and check to see what the professional licensing requirements are for financial planners in your area. A good financial planner will present several investment options tailored to your goals while explaining any applicable one-time and ongoing management fees.