Whether you manage your own investments or rely on your financial professional for an update, it’s always a good idea to monitor how the investments in your portfolio are doing. That’s the best way to avoid an unwelcome surprise that could throw you off-track and delay you in reaching your investment goals.
When you frequently check your investments, it’s easy to lose your long-term perspective. That’s especially true when you look at your portfolio on a day when there’s been a big move in a market index such as the S&P 500. Checking at the end of each quarter keeps you in the loop while retaining your long-term perspective.
Consider reviewing all your account statements at the same time, rather than as you receive them. If you use different accounts for the same goal, for example an IRA and a 401(k) to invest for retirement, you may need to refer to multiple statements.
When it comes to investment results, it’s all relative. If you’re considering making a change after a few disappointing quarters, start by comparing that fund to others with similar investment objectives. Look at how your current investment measures up to its peers over longer time frames. But remember, selling investments may also increase your tax bill.
Sometimes there’s a fine line between staying informed and micromanaging your portfolio.
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