How to Build a Core and Satellite Portfolio

Back to School Week: Core and satellite is a solid way to construct your investment portfolio, but it's important to consider risk and fees

Annalisa Esposito 8 September, 2020 | 10:15AM

Satellite in space

Building an investment portfolio is not an easy task. Whether you're are beginner investor or are a thriving fund manager, picking the right funds takes time and research and, despite that, many times we all get something wrong.

One approach investors can take is to build a core and satellite portfolio. This strategy can help to spread investment risk without overly limiting your returns. “Building the right portfolio is all about striking a balance between growth and risk," says Darius McDermott, managing director at Chelsea Financial Services. "You need your pot of money to grow enough to achieve your financial goals, while also being comfortable with the level of risk you're taking to succeed in that aim." 

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

About Author

Annalisa Esposito  is a data journalist for Morningstar.co.uk

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