Course 108: Creating Your Investment Policy Statement
Investment Philosophy
In this course
1 Introduction
2 Executive Summary
3 Investment Objectives
4 Investment Philosophy
5 Investment Selection Criteria
6 Monitoring Procedures
7 Revisiting Your IPS

In the Investment Philosophy section of your Investment Policy Statement, you'll articulate what's important to you as an investor. These are the theories you believe in and plan to follow.

Here are just a few questions to consider:

  • What's my philosophy about risk?
  • What's my philosophy about core versus noncore investments?
  • What's my philosophy about diversification?
  • What's my philosophy about trading?
  • What's my philosophy about costs?
  • What's my philosophy about taxes?
Before you buy or sell any securities, make sure that your actions reflect your philosophy. If they don't, ask why. Maybe you shouldn't be buying or selling that security. Perhaps your action is based on short-term performance, or a hunch about what the market is going to do. But your actions should be based on your Investment Philosophy.

Next: Investment Selection Criteria >>

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