Equity Portfolio Management (EPM) focuses on managing a client’s investments. It involves making decisions based on a variety of factors, including investment objectives, time horizon, liquidity requirements, tax and legal concerns, and unique circumstances. Managers may focus on specific sectors and market segments, as well as use various trading strategies to determine the best investment options.
EPM often involves building portfolio models and comparing them to one another. A manager will assign a specific weighting to each stock in the model. Then he or she will modify individual portfolios to match that weighting mix. This process is facilitated by the use of portfolio modeling software. It can also be performed using general programs such as Microsoft Excel.
An equity portfolio manager must carefully consider market capitalization guidelines. The primary goal of equity analysis is to identify and select the best stocks for a particular investor’s portfolio. Using quantitative analysis, an equity portfolio manager can identify companies that are likely to have high growth potential. They also look at companies’ financial productivity and valuation.
Investing in equities requires a significant amount of risk. Diversifying your portfolio is a great way to minimize this risk and protect against unwanted losses. Investing in stocks offers many strategies for profit, such as buying and selling when prices fluctuate. Other strategies can include agreeing to purchase a stock before a specified date.
