Streamlining Investment Management with Portfolio Trackers: A Guide to Key Features and Benefits

Investing in the stock market is difficult, especially in light of the unexpected events that occurred in 2022. It is essential to have a thorough understanding of one's portfolio to make educated investment decisions and effectively manage risk. With the advancement of technology, digital tools for portfolio management have gained popularity among asset managers.

The year 2022 was marked by a series of unanticipated market events that caused investors to lose over $30 trillion. As the market constantly fluctuates, portfolio management becomes increasingly difficult during such periods of instability. In order to mitigate financial risks, investors must navigate a multitude of trading instruments, multiple accounts, and brokers from various countries.

This article will examine the various digital tools used by asset managers and their key characteristics. The objective is to provide an unbiased overview of the available options so that market participants can make well-informed decisions regarding the optimal way to manage their portfolios.

Limitations of Manual Portfolio Analysis Using Excel and the Need for Automated Tools

Portfolio analysis is an essential aspect of investment management, as it helps investors and advisors track the performance of their investments and make informed decisions. One of the most commonly used tools for portfolio analysis is Microsoft Excel.

Excel is a versatile tool that can perform various types of fundamental analysis, including portfolio analysis. The portfolio analysis process in Excel involves creating a table containing all the necessary information about the portfolio. This information can be obtained from various sources, such as stock market data providers, company reports, and other relevant financial data.

In addition, Excel offers a wide range of features and functionalities that make it an ideal tool for basic portfolio analysis. The Excel table used for portfolio analysis typically includes information about the companies and their tickers, the number of instruments in the portfolio, market value, price changes, breakdowns in percentage terms, day changes in different currencies (USD, EUR, CHF, etc.), and more.

Once the data is entered into the Excel table, various calculations and analyses can be performed to track the portfolio's performance. For example, the portfolio's total market value can be calculated by multiplying the number of shares of each instrument by its current market price. The price changes for each instrument can also be calculated and visualized using Excel charts and graphs.

While Excel is an excellent tool for small portfolios, it can become problematic regarding institutional wealth management with dozens of portfolios. In such cases, manual Excel analysis can be time-consuming and may not provide the level of integration and visualization necessary for efficient portfolio management.

Therefore, automated tools become vital in such situations. Professional advisors working in banks or wealth management companies typically process up to 20 portfolios, each with 30-60 instruments. Excel-based manual management can be more of a problem than a solution in such cases. Having integrated data about various instruments and accounts, as well as high-quality visualization, becomes a must.

A representative from a Swiss wealth management company has disclosed that portfolios managed by the firm can contain a diverse range of up to 60 different investment types, including stocks, bonds, ETFs, mutual funds and other investment vehicles. To effectively monitor their investments, clients often utilize comprehensive analytics software tools that provide transparent information on portfolio holdings and facilitate informed projections of potential revenue outcomes.

The Future of Portfolio Tracking in the Era of Growing Retail Investment

Investment management can be complex and time-consuming, especially for investors with multiple accounts in different countries. This is where portfolio trackers come into play. Portfolio trackers like Snowball Analytics provide an end-to-end automated portfolio analysis and management solution.

With a user-friendly interface and a comprehensive portfolio overview, portfolio trackers can help investors make informed investment decisions. They also provide real-time data about price changes, profits, and other important information, allowing investors to stay up-to-date with the performance of their investments.

One of the main advantages of portfolio trackers is their interface and interactivity. They provide convenient dashboards showing real-time data about price changes and real profits after subtracting broker commissions and taxes. This allows investors to quickly and easily access the information they need to make informed investment decisions.

Another advantage of portfolio trackers is their cost-effectiveness. Most portfolio trackers use a freemium model and offer subscriptions starting from $100 per year. This is a significant cost-saving compared to professional instruments like Refinitiv and Bloomberg, which can charge more than $1,000 per month.

In addition to their user-friendly interface and cost-effectiveness, portfolio trackers also provide several features, including large amounts of data coming from 100+ exchanges and FX markets, diversification by countries, sectors, asset classes, and regions, as well as fund composition, compatibility with indices and different portfolios, dashboards for a clear picture, adaptive design for all mobile and desktop devices, 1-click access to main indicators, quick and easy import of transactions and auto-updating, to mention a few.

Notably, portfolio trackers like Snowball Analytics provide a comprehensive and automated portfolio analysis and management solution. With a user-friendly interface, real-time data, and cost-effectiveness, they are a great choice for investors who want to streamline their investment management process and make informed investment decisions.

In conclusion, the growing trend of retail investment is driving the demand for efficient and user-friendly data analytics tools. With the World Economic Forum projecting a 9% increase in the percentage of retail investors in global assets under management by 2030, the demand for portfolio-tracking solutions is expected to remain high. Banks and brokers are taking notice of this trend and are offering integrated portfolio tracking tools as part of their banking apps. As the market continues to evolve and new trading instruments emerge, the need for cost-effective, user-friendly, and sophisticated portfolio tracking solutions is expected to persist.

This post was authored by an external contributor and does not represent Benzinga's opinions and has not been edited for content. This content contains sponsored advertising content and is for informational purposes only and not intended to be investing advice.