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A share portfolio is the collection of shares you own as an investor. It is the combination of all the companies you have invested in. The composition of your portfolio determines how much risk you take and what return you can expect.
A well-structured portfolio usually contains multiple shares rather than just one.
By combining different shares, you spread your risk. If one company performs poorly, another company can partly offset that loss. Investors often choose shares from different sectors or regions to make their portfolio more stable. The value of a share portfolio changes daily because the prices of the underlying shares are constantly moving.
Short example:
Suppose you own three shares. You have invested €1,000 in company A, €1,000 in company B and €1,000 in company C. Your total share portfolio is worth €3,000. If company A rises by 10%, company B remains unchanged and company C falls by 5%, your portfolio is worth €3,050. The gain in one share has partly offset the loss in another.
Disclaimer: Investing involves risks. Our analysts are not financial advisors. Always consult a professional advisor when making financial decisions. The information and tips provided on this website are based on the personal insights and experience of our analysts and are intended for educational purposes only.
