Investment Management

Many people approach investing in a haphazard manner, purchasing individual stocks and bonds, but never really deciding how to structure their overall investment portfolio. With no strategy to guide purchases, these portfolios can contain investments that are inappropriate for the individuals’ circumstances. Time should be taken to develop an investment strategy.

• Identify your goals – your need for liquidity, desired return, current income needs, portfolio size, tax situation, age and investment period can all have a significant impact on which investments are appropriate.
• Research investment alternatives – investigate all options including cash equivalents, bonds, stocks, mutual funds, variable annuities and other choices. Make sure you understand the basic aspects of each; examining the types of risk they are subject to as well as their historical rates of return.
• Assess your risk tolerance – make sure you understand the potential downside as well as the upside to any investment. There are at least two factors that impact your risk tolerance. One is the level of investment risk that is appropriate for you based on your personal situation. The other element is your emotional risk tolerance. Even though your personal situation may indicate that you could assume a high level of risk; that may not be prudent if you are uncomfortable with that risk.
• Decide on an appropriate asset allocation mix – decide what percentage of your portfolio should be allocated to stocks, bonds, cash equivalents, and other alternatives. Each individual’s asset allocation strategy will vary based on individual circumstances and may change over time as your personal situation changes.
• Compare your current investment portfolio – calculate how much of your current investment portfolio is invested in each category. Take a fresh look at each investment you own, determine if and what changes need to be made to your portfolio to bring it in line with your desired asset allocation.
• Adopt an automatic investment strategy – invest on a periodic basis rather than sit on the sidelines waiting for the perfect time to invest. Implement investment strategies that you understand and have a consistent return over the long term.
• Monitor your portfolio periodically – compare each component to a relevant benchmark to ensure that your investment strategy stays on track. Rebalance your portfolio annually to your desired allocation. You may find that your allocation percentages should change as your personal situation changes.

Enterprise Bank & Trust provides clients with a full range of investment products and services from the financial industry’s leading firms.

• Stocks
• Mutual Funds
• Bonds
• Annuities

NOTE: Investment products offered through Enterprise Bank & Trust are:

• NOT FDIC insured
• NOT guaranteed by Enterprise Bank & Trust or any of its affiliates
• Subject to investment risk and may lose value