2 Things Many People Don't Consider When Building Their Portfolio And Why You Should Consider Them

Any old article you read on portfolio construction will tell you some of the same things:

-  Consider your time horizon

-  Consider you risk tolerance

-  Consider investing money you won’t need short-term

-  Consider investing in multiple asset classes and sectors Don’t get me wrong. That’s all great advice, but there’s 2 things being left out.

Your Career Is More Than Just Your Career

Everyone sees their career as a means to produce an income. This income could then be used to enjoy your life today and invest for your future. But many don’t consider that their career is a part of that portfolio they are investing in. In fact, it is probably their most concentrated holding.

So what do I mean by that?

Let’s say you work in Technology. If your portfolio is then full of technology stocks, you could be overexposing yourself to the Technology sector. Meaning, if there is a downturn in Tech, not only might it affect your portfolio, but it might affect your income.

Consider Investing Proportionately In What You Know

Look at your investment knowledge as a pie chart. For some of you, that pie chart may be a large portion of technology stocks. For others, it might be real estate. And others it might be alternative investments. I am not saying you should overexpose yourself to one of these, but if you have more knowledge than the average person, it could make sense to put more of your overall portfolio in that type of investment. You know it well which could lead to the potential for increased returns. Self-awareness is key here.

Finance Is Personal

Sure, there are rules of thumbs of how much percent your portfolio should never exceed 1 stock or sector. Many of those have validity and only exist to avoid pain with investing. Just know, finance is personal. The strategy that works for your neighbor may not work for you and vice versa. Consider your career and knowledge areas when building out your portfolio.

Disclaimer

This article is intended to provide general information and does not constitute financial advice. Everyone's financial circumstances are unique. It's crucial to

consult with a financial planner or a trusted financial professional who understands your specific situation before making decisions based on this information.All investments involve risk and may lose value.

Armando Sallavanti is a registered representative of and offers securities and investment advisory services through MML Investors Services, LLC. Member SIPC (www.sipc.org). Supervisory Office: 2 Bala Plaza, Ste 901, Bala Cynwyd, PA 19004. Tel: 610.766.3000.

Licensed for insurance in: AZ, CA, CT, DE, FL, HI, IN, MD, NJ, NY, PA, TX, UT CA Insurance Lic. # 4148846; domiciled in PA

Registered for securities in: AL, AZ, DE, FL, HI, IN, MD, MN, NC, NJ, NY, PA, TN, TX, WA

CRN202609-5011635