Strategy Beginner: Steps to a Suitable Portfolio

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1.
When its time to rebalance your portfolio, which is the most likely to happen?
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Youll probably have to increase your cash/bond position and decrease your stock position. Most of the time, stocks outperform cash and bonds. As a result, youll usually have to cut back your stock position when you rebalance.
2.
A successful portfolio _______.
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Should contain investments that work together to help you reach your goals. A portfolio can be made up of "good" investments, but they may not work well together.
3.
What vital information does your goal give you?
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Both of the above. Your goal tells you both how long youll be investing and how much money you can put at risk.
4.
When rebalancing your portfolio, it is a good idea to weed out redundant investments.
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True. When you have redundant investments, one of them usually has lower expenses and a stronger long-term risk/reward profile, which can make it an advantage.
5.
To determine whether your existing portfolio fits your investing blueprint, you should, among other things, search for overlap among your investments.
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True. Searching for overlap will weed out unneeded redundancy.