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Portfolio management Meaning

Portfolio management is the professional art and science of making decisions about investment mix and policy, matching investments to objectives, asset allocation for individuals and institutions, and balancing risk against performance. It involves determining the strengths, weaknesses, opportunities, and threats in the choice of debt vs. equity, domestic vs.

international, and growth vs. safety. Portfolio management can be passive, simply tracking an index, or active, where a manager attempts to beat the market through superior research and timing.In fintech, portfolio management has been democratized through robo-advisors.

These platforms use algorithms to automatically manage a user’s portfolio based on a risk assessment survey. The software handles tax-loss harvesting and automatic rebalancing, tasks that were previously only available to high-net-worth individuals through expensive private banks.

This shift has significantly lowered the barrier to entry for professional-grade wealth management.Crypto portfolio management introduces unique challenges, such as managing liquidity and navigating high volatility. Managers in this space must account for the correlation between Bitcoin and altcoins.

During market downturns, crypto assets often move in lockstep, making true diversification difficult. Professional managers use hedging strategies, such as shorting futures or buying put options, to protect the portfolio’s value during bearish phases without selling the underlying spot positions.Effective management also requires a deep understanding of custody and security.

A manager must decide what percentage of the portfolio should be kept in cold storage for safety versus hot wallets for active trading or yield farming. As institutional interest grows, the emergence of prime brokerages in crypto is providing managers with the tools needed to manage large-scale portfolios with institutional-grade compliance and reporting.

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Important Disclaimer:

Finery Markets BVI Limited (“Finery Markets”) provides software, technology infrastructure, and related Information and Communication Technology (ICT) services on a Software-as-a-Service (“SaaS”) basis. Finery Markets acts solely as a software vendor and does not operate a trading platform, does not intermediate, match, execute, clear, or settle transactions, and does not engage in any activities that would require regulatory authorisation under applicable laws.

Finery Markets’ software is non-custodial and is provided exclusively to licensed institutional entities that act as independent operators of their own environments. All counterparties are solely responsible for establishing and maintaining their own bilateral trading and settlement relationships. Finery Markets is not a party to any such arrangements and assumes no responsibility for the conduct, verification, or compliance obligations of any users of the software.

Nothing on this website shall be construed as a financial promotion, investment advice, or an offer to engage in regulated activities. Access to and use of the software is strictly limited to clients who have entered into a software licensing agreement with Finery Markets. Persons located in jurisdictions where such access is restricted should not rely on this website or any of its contents.

Additional notice to UK visitors: This website and associated communications are not intended to constitute a financial promotion under The Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) and related guidance. Access to services provided by Finery Markets is limited to regulated entities, professional clients and eligible counterparties as set out by the Financial Conduct Authority. UK users are not permitted to use this website for the services of Finery Markets if they don't fall within these categories.