Framework

The investment management cycle

The question it answers

When managing their own savings, what steps should an individual investor follow, from setting goals and risk appetite to monitoring and adjusting the portfolio?

Origin
Brinson, Hood and Beebower, 1986; Ibbotson and Kaplan, 2000
Diagram type
Cycle
Level of analysis
Individual
Topics
Corporate finance
Stack of clay coins beside a rising glass bar chart, icon for finance

Diagram

The investment management cycle

  1. Assess goals and risk appetite
  2. Write an investment policy statement
  3. Structure the portfolio
  4. Monitor and report
  5. Review and adjust

Sources

References

Listed A–Z by author surname, Harvard style. A source with a DOI links to https://doi.org/…; one without links to its page or says plainly that it has no DOI.

  1. Brinson, G.P., Hood, L.R. and Beebower, G.L. (1986) ‘Determinants of portfolio performance’, Financial Analysts Journal, 42(4), pp. 39–44.doi:10.2469/faj.v42.n4.39Source page
  2. Ibbotson, R.G. and Kaplan, P.D. (2000) ‘Does asset allocation policy explain 40, 90, or 100 percent of performance?’, Financial Analysts Journal, 56(1), pp. 26–33.doi:10.2469/faj.v56.n1.2327Source page