Design
Your Portfolio On the
Overview page of this section we discussed NAOI-defined Portfolio
Segments that corresponding to four distinct types of investing
activities. Each of these segments has a unique risk, reward,
involvement profile that you will learn as you complete each course in
the Confident Investing Series. Here they are again.
| Segment |
Investment
Type |
Confident
Investing Series Course |
Target
Return |
| 1 |
Core
Mutual Funds |
Course
2: Building Your Core Funds Portfolio |
13%
+ |
| 2 |
Focused
Mutual Funds |
Course
3: Investing In Focused Funds |
20%
+ |
| 3 |
Individual
Stocks |
Course
4: The Art and Science of Trading Individual Stocks |
25%
+ |
| 4 |
Stock
Options |
Course
5: Stock Options for the Average Investor |
20%
+ |
The NAOI Segment Allocation
Calculator
Now use the following calculator to
test multiple portfolio designs on your own. Your inputs are:
- Segment
Target Return. At this point you will need to guess at
this percentage. The NAOI believes that the Target Return numbers
presented in the above table are feasible. You will only be able
to project a Target Return of your own for a Segment
after you have graduated from the corresponding NAOI Course. For now simply
vary the numbers and view the results on the Total Portfolio Return.
You may not now believe that such high returns are possible. The
NAOI is confident that as you graduate from each course your view
will change.
- Segment Allocation. This is the amount of your total investing
funds that you will allocate to each Segment. You may not want to
include all Segments in your portfolio. You can put a zero
allocation on any you wish to exclude. The Allocation variable
allows you to adjust the Risk/Return profile of your Portfolio.
Greater allocations to Core Funds will reduce risk and return.
Greater allocations to Individual Stocks will increase risk and
return.
Determining
Your Target Return Goal
The above calculator lets
you configure a portfolio that produces a total Target Return. But
what Return % should you aim for?
The entire NAOI Approach
to Investing is aimed at enabling you to realize goals that you really
want to achieve in your investing career and not be forced to settle
for goals given to you by a third party. Course 1 of the Confident
Investing Series enables you to define these goals and create a
feasible Investing Plan. An integral tool that you will use in this
course is an NAOI Calculator that shows you the Required Return needed
to meet a goal you have defined. This is the
Portfolio Return that you will
strive to reach with the Segment Allocation Calculator.
Click
here to launch the NAOI Return Required Calculator in a separate
window.The
NAOI New Approach: In Summary A
structured approach is key to effective and confident investing. We
have given you only a brief overview of the NAOI New Approach to
Investing in this section of the Web site. But it should be enough to
illustrate to you that each and every NAOI Course is part of a
coherent, logical and pragmatic methodology for building a portfolio
that meets your specific needs. In comparison, other investor
"education" resources available on the market today are
simply random bits of information. |
