In financial terms, a portfolio is a grouping of assets such as cash, stocks, bonds and mutual funds, explains Investopedia. Individual investors either hold and manage their own portfolio or pay a financial professional to manage the portfolio on their behalf.
When creating an investment portfolio, an investor should first consider his goals, according to MarketWatch. It is important that an investor be mindful of how much of a return on an investment he wants and how soon he wants to achieve that return. An investor should be mindful of risk when composing an investment portfolio. Although all investments contain some amount of risk, some assets are riskier than others. If an investor needs money in a relatively short period of time, safer assets are the better investment option.