Portfolio Management

Portfolio management is how you set yourself up for long-term financial success and stability. Learn how to square your own investments with your time horizon and risk tolerance.

Frequently Asked Questions
  • How many stocks should I own?

    There’s no one-size-fits-all number of stocks you should own, but you should diversify your portfolio to include stocks from a range of sectors to reduce risk. ETFs and mutual funds that track broad-based indexes like the S&P 500 or Russell 3000 are an excellent way to diversify your stock portfolio.

  • Do I have to pay taxes if I rebalance my 401(k)?

    No, you won’t have to pay taxes on the sale of any appreciated assets within your 401(k) during rebalancing. Your capital gains in a 401(k) aren’t taxed until the money is withdrawn from the account. Selling assets to rebalance a regular brokerage account, however, will incur taxes.

  • What is the most volatile sector?

    Historically, the energy sector has been very volatile compared to the broader market. S&P Global research found that over the course of the 2010s, the energy sector had a standard deviation of 20.3%, nearly double that of the least volatile sector, consumer staples (10.7%). The energy sector is susceptible to unpredictable and dramatic swings in the price of oil.

  • What industries outperform during recessions?

    Some bright lights for investors during recessions can include consumer staples, groceries, alcoholic beverages, cosmetics, and discount retailers. Companies in these spaces either offer consumers essential items, non-essential goods at the best price, or small luxuries and comforts that people can and want to make room for in tighter budgets.

Key Terms

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