Tag Archives: Advantages

Create a portfolio: organizing my investments

Imagine this situation: you are an investor, you have different assets which have different performances and evolutions in the markets. Think about you have dozens of assets: ETF, stocks, mutual funds, bonds, maybe alternatives… And you cannot find a way to organise and control all of them. Well, the answer is: you have to create a portfolio.

First of all, you have to think about a strategy. The main steps are:

  • Define your goals. Answer yourself: when will I need the money? Consider a strategy for a short-term or a long-term taking into account the volatility and the Value at Risk.
  • Consider your risk aversion. An investment is always risky. If you choose very volatile assets, you may get high returns… or losses.
  • Consider the asset correlation. Uncorrelated assets help reduce losses.
  • Think also about how often you will control your investments: every week, every month, every three months. It should be related with your goals. Consider changing your asset allocation and rebalancing your portfolio.

My portfolio in T-Advisor

T-Advisor provides you a tool to create your own portfolio. The steps to do that are very easy: after defining your investor profile (depending your risk aversion, from very conservative to aggressive), just follow the steps in this video tutorial.

Then you will find a great deal of information to analyze your investments, as performance, risk and diversification. You can also review the investment movements that you have done, buying and selling assets.

My portfolio charts and data in T-Advisor

But what are the main advantages of creating an investment portfolio?

  • You can allocate different kinds of assets to protect you against volatility. A portfolio helps you structure your investments in order to diversify and reap benefits.
  • It helps you plan your finances. Think about that you are saving money for different milestones in your life: a house, the studies of your children, your retirement. You set a portfolio with a certain investor profile to get certain returns in order to achieve your performance goals.
  • You can rely on a passive investment style. Once you create a portfolio, you do not need to change your assets as a day-trader, but just rebalance them every certain period of time, if necessary.

T-Advisor is ready to cover your investor needs. Our tools report you about the main figures and data from stocks, ETF and funds from many markets around the world, so that you can choose the best for your interests and design the suitable portfolio for you.

Technical analysis: a picture speaks a thousand words

The schools in finances, if we may speak about them, are two: fundamentalists and chartists or technicians. Both are quite different when they analyze and prospect market trends. Fundamentalists look into the conditions that produce a given price in a moment (for instance, interest rates for currencies or balance sheets in companies). On the contrary, technicians just consider the price without any economic or accounting figure and research into the trends of the pricing line in a chart.

Let’s look this example extracted from the T-Advisor app. If we select a listed item (in this case, Bank of America), we can choose different indicators from the software.

Selecting technical analysis figures from T-Advisor app

An example resulted from the selection of some indicators show us the following chart:

Technical Analysis Chart from T-Advisor app

In this chart we selected the pricing line since 2001 and the trending lines SMA (Simple Moving Average) for 20, 70 and 200 days. These lines let the investor or the advisor have the perception of how the price of this company is moving in the market.

What are the main advantages of technical analysis? Actually, this concept focuses just on price. So, as particular investors, we do not need to know deeply about economics. Secondly, charts give us easily and quickly the trend (upwards, downwards, sideways). Thirdly, we discover patterns, as technicians think that market actions repeat. Of course, they are not necessary easy to discover, but they exist. Finally, charts provide the investor a wealth of information just with an image and the right software.

Technical analysis has jumped with the development of computing and software tools based on this concept are a great help to success in the finance markets. Last, but not least, technical analysis is applicable to all kind of tradable products: stocks, bonds, currencies or commodities.

Are you new in finances? Do you want to learn more about technical analysis? This blog will publish regularly posts about the main concepts and vocabulary linked to it.

ETF, an easy way to perform in the market

Exchange Traded Funds, broadly known by its initials ETF, are a kind of security available in Stock Exchange. As they are listed in the markets, they work as stocks, although they have some features from mutual funds.

As a stock, prices move continuously and are always updated, against mutual funds, whose prices are updated when markets are closed. So, investors have permanent information about the value of their positions and can react to change the strategy. As a stock, also, investors can buy on margin, short sell o hold for the long term.

But there are more advantages to be considered. ETFs track indexes, sectors or a basket of securities (for instance, different shares, commodities, bonds), that means, they are linked in their performance with the yields obtained from these investments. Investments are diversified with no effort looking for new securities and trading non-stop. In the finance jargon, this is known as passive management.

Traditional mutual funds develop an active management to outperform the markets. In other words, to get more yield than the indexes or sectors. ETFs just follow the trend of the market and their managers only make some little adjustments to keep the line. This kind of management has an immediate positive aftermath: costs are quite less for the investor. Fees and administrative costs are lower, as they need fewer resources to get results.

So, price transparency, diversification, fewer costs and flexibility are the main advantages. ETFs market has widely developed in the last years. Global flows reached $32.9 bn only in October, but from January the flows come to $194.2 bn, so a recent BlackRock report. Bloomberg ranks the biggest ETF in the US by investment sectors and Morningstar ranks also ETF by performance. Some funds beat 100% yearly return.

T-Advisor, aware of the good performance and advantages of ETF, recommends these products in the investment planning tool.