It is vital to set up a spreadsheet to track your portfolio. This will make it easier to administer, as well as helping you invest in a more disciplined way. Many financial websites now offer portfolio management tools though investors may prefer to devise their own customised spreadsheet using Microsoft Excel or similar software.
When doing this, the temptation is to focus on the amount of money you have paid, or the price per share. But what you should be most concerned with at all times is performance, performance, performance. Concentrate on your percentage gain or loss since you bought. Try to measure this
| 1. In absolute | How much have you made? |
| 2. In annualised | At this rate, how much will you make in a year? |
| 3. In relative terms | How are you doing relative to your benchmark? |
Always rank your shares by one of the first two measures. That way, you can see at a glance which are your strongest and weakest performers. This will assist you in holding, or even adding to, your best holdings and weeding out your worst.
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