Build your perfect investing strategy with exclusive tips from Prof. Thorsten Hens
Investment Contest: Switzerland for Financial Literacy
Welcome back, dear participants!
With the release of Milestone 2: Invest like a Pro, you've been learning all about the intricacies of crafting the perfect portfolio. However, have you paused to consider your next strategic move in the face of unpredictable market behaviour?
That's precisely why today, we are going to focus on strategy!
Our jury member, Professor of Finance, Thorsten Hens of the University of Zurich, will assess your portfolios based on the thoughtful documentation of your strategic decision-making process throughout the contest.
Curious to uncover the specific criteria Professor Thorsten will be evaluating? Keep reading! Whether you're a seasoned investor or just dipping your toes into the realm of finance, you will for sure learn something new.
IMPORTANCE OF HAVING AN INVESTING STRATEGY
Understanding the importance of having a solid investing strategy will help you navigate the unpredictable financial markets. A well-defined strategy not only serves as a guiding compass amidst market uncertainties but also helps you make informed decisions tailored to your long-term goals. Whether it's preserving capital, generating income, or seeking growth opportunities, a thoughtful investing strategy provides a framework for achieving financial success.
WHAT SHOULD YOU FOCUS ON IN YOUR PORTFOLIO STRATEGY?
Prof. Thorsten Hens brings extensive experience in behavioural economics and a deep understanding of human behaviour in financial decision-making for the evaluation process.
Here is a list of points, he will be focusing on while examining your portfolios:
What are the goals of the strategy – e.g. wealth preservation, growth, or regular cash flows?
Define the objectives of the investment strategy.
How does the strategy achieve these goals – strategic asset allocation, and tactical asset allocation implementation?
Explain your asset allocation strategies and their execution
What were the reasons for the trades that have been made – change in market view, incurred losses, too high volatility?
Show your thinking process behind the trades executed within the portfolio, considering factors like shifts in market perspectives, incurred losses, or excessive volatility.
That is to say, Prof. Thorsten Hens does not evaluate the strategy by whether it was lucky (good returns) over this short horizon.
The evaluation focuses on the strategic decision-making process rather than short-term returns, aiming for a comprehensive understanding of the strategy's thoughtfulness and rationale.
FIND YOUR INVESTOR TYPE
Fortunately, there are a handful of 6 or 7 strategies that can work well. Professor Thorsten Hens provides exciting insights and valuable tips on how you can structure your portfolio for the competition in his podcast episode. Don’t miss out on his extensive expertise in the investment field and check out his exclusive episode to benefit from the knowledge of an expert!
If you're unsure which strategy aligns best with your personality, be sure to take our Investor Type Quiz. By doing so, you'll receive an exclusive roadmap designed to guide you further on your financial journey!
So, what's the best strategy for you? Are you ready to discover the next steps on your financial path? Unlock the full potential of your investor type with your personalized strategy plan. Carefully tailored to your needs, it breaks down all the information into actionable steps you can implement immediately!
