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4 overlooked investing techniques that could help optimise your portfolio


Looking for ways to get better returns to your portfolio? We show you some of the key things you need to know.

Sponsored by Stock Doctor. Stock Doctor provides you with the essential tool set you need to create, manage and optimise your portfolio. Register for your free 14-day trial.

When it comes to trading, your portfolio is your central focus.

Over time, it develops into your area of expertise, provides you with a balanced range of investments, serves as an income stream and provides a base you can expand from.

But there's always room for improvement – even in well-performing portfolios.

So today we're taking a look at some of the techniques you can use to optimise your portfolio that you might not have known about.

👋 Hey there! As this is sponsored by Stock Doctor, we'll be using some examples from its products in this article. But always compare your options and do your research. Make sure that you also read the product disclosure statement (PDS) and target market determination (TMD) before signing up for any financial product.

1. Diversification strategies

Stocks – and consequently your investment portfolio – are affected by a huge range of different factors. Market trends, legislative changes, social movements and wider developments in the outside world are just some of the considerations that affect trading on a day-to-day basis.

So when you're an investor, it can be very tempting to stick to what you know. Over time, you gain an understanding of the cycles in your portfolio and your preferred industries. It's familiar.

But it's precisely because of these factors at play that it's important to have a diversified portfolio. As different segments of the market tick away at different rates, having a diverse portfolio in place can allow you to weather storms on one front, while also thriving on others.

Although it can be a bit daunting at first, looking at diversification can be a great way to optimise your portfolio for the long term. Seeking the advice of experts – like those at Stock Doctor – can also help give you clarity around the process, too.

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2. Leveraging trading algorithms

Trading algorithms have seen a boom in popularity in recent years. They've become quite sophisticated and able to handle a much broader range of tasks than simple stop-losses.

Today, trading algorithms can also enable you to carry out a huge range of functions, including creating parameters for buying, selling and making trades, and automatically checking market conditions.

All of this can be done at a speed far faster than humans are capable of too, allowing you to ensure that you're locking in the best possible prices.

Experimenting with algorithms can be a great way to backtest potential strategies and identify new opportunities.

For example, Stock Doctor offers an algorithm that can actually help you spot the potential profitability of a stock – which in turn can help you make better purchasing decisions.

Algorithms can drastically streamline the process of trading and enable you to make smarter decisions about where you're placing your money, both in the short and long term.

Of course, even when you're using trading algorithms, the same basic principles of trading still apply. Don't invest more than you can afford to lose and don't blindly follow a course of action that's obviously not working.

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3. Risk management software

Risk management is key for successful investing over a long-term period.

Although every investor will take a loss and make mistakes from time to time, having risk management built into your trading strategy is essential to ensure that you're not just pursuing a series of duds.

This is where risk management software can be useful.

With the right tool set, you'll be able to look at considerations like your daily loss limit and risk per trade in advance – rather than learning tough lessons after the fact!

By having these safeguards in place, you'll be able to act in a more sustainable manner as an investor, rather than going on a rollercoaster of big wins and bigger losses.
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4. Using stock simulators

Stock simulators aren't just useful as a way to practice trading when you first get started.

They're also a great way to test out variations on your current strategy, or even entirely new trading strategies.

One of the main benefits they offer is that they provide you with real market data, rather than just using abstractions or what would otherwise just be video games.

Stock simulators also represent a great way to experiment with trading algorithms, too. If you've been thinking about whether you could incorporate them into your trading strategy, stock simulators can be an excellent way to put them to the test.

Donald Sutherland -- Stock Doctor member since 2006

"Stock Doctor provides me with all the fundamental analysis I require to make my investment decisions. Everything I need is at my fingertips at an instant, saving me hours of research. I have extended my subscription for another five years which looks like one of the best investment decisions I have made. I can't live without Stock Doctor - it's been worth every cent."

You'll be able to get clear insights into how your strategy performs in a real-world environment, without putting your actual funds at risk.

It's also good to work with others to develop trading strategies – people who've been there, done that before. Services like Stock Doctor can actually put you in touch with trading experts that help you look at your existing portfolio and for ways to optimise it.

To find out more about trading stocks, make sure you check out our step-by-step guide.

Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, CFDs, options or any specific provider, service or offering. It should not be relied upon as investment advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involves substantial risk of loss and therefore are not appropriate for all investors. Trading CFDs and forex on leverage comes with a higher risk of losing money rapidly. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades. Read the Product Disclosure Statement (PDS) and Target Market Determination (TMD) for the product on the provider's website.

Learn more about Stock Doctor

Sponsored by Stock Doctor. Stock Doctor provides you with the essential tool set you need to create, manage and optimise your portfolio. Register for your free 14-day trial.

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