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Financial Planning and Asset Management

by GBAF mag

We hear so much about stocks, bonds, mutual funds and the whole load of financial instruments that make up the asset category. And, with such an abundance of ideas out there, it is sometimes hard to keep track of which asset class is best to invest in. This article is my attempt at an asset classification guide, and I hope it helps you find the best financial investment strategy. Stocks, of course, are the first option to consider when looking for growth-oriented investments. If you want to be able to grow your nest egg, stock investments are the best way to go.

When it comes to choosing what are the best stocks to own, you have to take into consideration not only the price per share, but also the overall earnings potential. Which company has the highest EPS growth percentage? Which company has the lowest cost of ownership? Which are the top ten best companies overall in terms of market cap? A complete list of the assets available for growth should be considered in the asset management process.

Once you have determined the available assets for growth, it is time to choose which of those assets will make for the best long-term investment. The first thing to do in the asset management process is to determine whether the chosen company has growth potential. Some companies are simply there to make money, using any and all resources to do so. Other companies have long-term growth objectives that are difficult to achieve but not impossible.

When looking at those types of assets, consider how much money can be earned, and the type of profit that can be realized. Also, think about the risk/reward ratio. How much income can a firm owner expect if that firm is no more than likely to fail in the next five years. The value of these assets should be determined in light of the firm owner’s expectations about his/her firm’s profitability in the coming years.

After determining the type of asset class that the firm will invest its resources in, an asset allocation strategy should be developed. The best way to do this is to break the asset into its component parts and use those components to generate a portfolio of assets. For example, let’s assume that the firm has capital gains stock funds. This is the portion of the portfolio that will be used to offset any losses from the equities. Any other parts of the portfolio should be invested in cash or by buying and selling penny stocks.

One important part of the asset management process involves determining the effective asset lifecycle. The effective asset lifecycle is the time frame over which an investor is able to capture the largest percentage of return on the initial investment. It is best to have a long term asset management strategy that spans several years.

A long-term financial planning and asset management plan must have several elements. First, the total cost of an asset must be determined. The cost includes both the tangible assets and intangible assets. The total cost will include only those costs for which replacement is considered to be infeasible, such as capital equipment or inventory. It will not include expenses such as insurance premiums that are related to an asset’s long-term viability.

Furthermore, the total cost must be segmented by asset types. Assets that are used to offset losses in other areas should not be included in the total cost calculation. Finally, an asset management plan must include one or more realistic growth scenarios that allow for a rise in asset values over time.

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