Abstract
Globalization and IT progress are expanding the possibilities of using various financial instruments to create a personal investment portfolio. The purpose of the study is to differentiate the investment portfolio by the level of income of Ukrainian citizens and its impact on the effectiveness of personal finance management. Analysis of indicators of state and current investment trends allowed identifying the optimal ratio of profitability and risk in financial decisions of individuals by diversifying the investment portfolio, creating personal reserves, localizing investment instruments and minimizing the use of credit resources.The result of the study is the development and justification of criteria that an investor should meet during the investing. In particular, the formation of an individual investment portfolio depending on personal income allows everyone to justify an effective personal investment policy, taking into account the available investment tools. The paper covers the approaches to the formation of a person’s investment portfolio, depending on the level of his or her income. The paper also examines the need to form an optimal investment portfolio, depending on the real financial opportunities of a person.
Highlights
The culture of consumption and saving and the relative basic principles of money management are an integral part of social life in Ukraine
The study analyzes investments that decision-making, this study shows that the percan improve people’s financial condition in future son’s level of revenue, acceptable risk and the purand bring them extra benefit: pose of the investment are decisive
A young person is more at risk, so the al finances, revealing of objective laws in charshare of stocks in its investment portfolio, even acter and intensity of investment by the popuwith a low income, will be higher than that of lation is especially actual in an unstable finanpeople with the same income, but older
Summary
The proportion, which represents how the available finances are distributed for consuming and saving, influences the economy directly through consumer demand, and the speed of fixed capital accumulation, thereby providing a long-term perspective for the country’s economic growth. Under conditions of market relations, savings have a distinct economic growth in a form of investment capital. The optimal option is when the maximum effect is achieved in the form of return on investment, and the risk of loss is reduced to zero. This situation is not possible under market conditions, so the person should always consider the restrictions on risk or return. The main motives, tools and criteria of diversification of individual investment portfolio are relevant today
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