Investment portfolio

What Is an Investment Portfolio?

An investment portfolio is a basket of assets that can hold stocks,

bonds, cash and more. Investors aim for a return by mixing
these securities in a way that reflects their risk tolerance and financial
goals. There are many different types of investment portfolios, as some
are built into 401(k)s, IRAs and annuities, while others exist on their
own through a brokerage or financial advisor firm.

How to determine an Investment Portfolio’s Asset Allocation

An asset allocation describes how a person breaks down an investment

portfolio based on asset class. An asset class is a category of different
securities. For example, equities are stocks, shares of which a person
own as a slice of a company that do not offer fixed returns. Meanwhile,
fixed-income can include bonds and certificates of deposit (CDs).

Examples of different securities a person can build an investment

portfolio with:

 Exchange-traded funds (ETFs)

 Mutual funds
 Bond funds
 Real estate investment trusts (REITS)

But a person can just randomly dump these into an investment

portfolio and expect a major return. While diversification is key, your
asset allocation should adhere to your risk tolerance.

Types of Investment Portfolio

Stocks. Stocks are the most common component of an investment portfolio
Bonds
Alternative Investments
Growth portfolio
Income portfolio
Value portfolio
Challenges for international aid
Social exclusion presents various challenges for donors. There is considerable variation amongst
developing
countries in the availability of information, as well as important contextual differences in terms
of the nature of
exclusion and if/ how the concept is understood. National level census and survey data and
poverty monitoring
often fail to provide much information on excluded groups. Donor organisations are also usually
large and
dispersed, and need time to embed social exclusion approaches across their work. Developing
indicators for
and monitoring and evaluating programmes is also a challenge.
In aid, exclusion has become popular with non-economic social scientists. This is due to its focus
on societal
institutions, actors, relationships and processes. In these, disparity in income or lack of access to
social services
may be both an indicator and an outcome.
The literature identifies several approaches, lessons and tools that aid actors can draw on to
address social
exclusion:

Policy instruments, such as:
- donors adopting specific policies and plans against social exclusion.
- working on cross-cutting processes that can tackle the manifestations and causes of social
exclusion. Examples include advancing inclusive institutions, anti-discrimination legislation,
human rights, and affirmative action. Programmes that support voice, empowerment and
accountability are also beneficial. So is targeted action for the inclusion for specific excluded
groups, such as women and girls, and persons with disabilities. Evidence also shows that aid
actors can tackle social exclusion in difficult settings, such as violent conflict and
peacebuilding.

Sectoral action, for instance on inclusive growth, service provision, social protection, information
and
communication technologies (ICTs).

Learning from typical challenges for international aid, such as lessons from experiences with
Poverty
Reduction Strategies (PRSPs) and lessons on the role of civil society and social movements.

Heterodox Economics

What is Heterodox Economics?

Heterodox economics is the analysis and study of economic principles
considered outside of mainstream or orthodox schools of economic
thought. Schools of heterodox economics include socialism, Marxism,
post-Keynesian(not to be confused with new Keynesian) and others.
These schools of thought often combine the macroeconomic outlook
found in Keynesian economics with approaches critical of neoclassical
economics.
In short, Heterodox economics refers to all the theories and schools of
thought that are outside the mainstream, market-based approaches.
Heterodox economists are interested in power dynamics and historical
context when approaching economic problems.

It plays an important role in challenging established schools of economic

thought to continually prove their worth as a policy framework for the
real world.

Understanding Heterodox Economics

Heterodox economics provides an alternative approach to mainstream

economics that can help explain economic phenomenon that is ignored
or unaddressed by more orthodox theories. For example, heterodox
economics can plausibly explain why some groups of people have been
unable to make progress on their standard of living in comparison to
peers by incorporating history and power into the hypothesis. Heterodox
economics often seeks to embed social and historical factors into
analysis, as well as evaluate the way in which the behavior of both
individuals and societies alters the development of market equilibriums.

Heterodox economists remain dissatisfied with mainstream economics.

This is because, no matter how many modifications the latter adds to its
core framework, there is always an implication that the economy would
function smoothly in the absence of various real world conflicts.
Mainstream economists ruling the world would presumably achieve full
employment with near perfect utilization of resources, and stay there -
perhaps buffeted by mild external shocks. In reality, however, human
failings and group dynamics would likely prevent this, so heterodox
economists are looking for more flexible models that come closer to the
real world by some measures.

The Value of Heterodox Economics

Although heterodox economics has faced a lot of hostility on the

academic side, it has actually shifted mainstream economics towards a
more integrated approach. Looking solely at market fundamentals
ignores many useful frameworks like behavioral economics and
complexity economics that have since been adopted by mainstream
economists. More importantly, having a range of heterodox frameworks
with plausible solutions to economic contradictions forces all economists
to question the starting assumptions when approaching these questions.

There is also more pluralism in economics thanks to the competing

theories from heterodox approaches and this has also led to more multi-
disciplinary analysis of economic problems. Economics has been very
focused on market-based explanations. It is possible that this is the best
approach for the majority of problems.

Unfortunately, the track record of non-orthodox economic approaches

in informing actual policy is a spotty one, particularly those frameworks
flowing from Marxism. Heterodox economists would counter that these
were not pure applications. In reality, there is never a pure application of
any school of economic thought. We tend to stick to our orthodox
approach because, even imperfectly done, it has worked out better for
us on the balance. That said, heterodox economics is playing an
important role by continually challenging the orthodox school to prove
that it really is better in practice, not just by tradition.