Personalist investment is a type of investment focused on the specific characteristics of an investor or a small group of investors.
Personalist investment focuses on the individual preferences of each investor. Unlike generalist or standard investment, it adapts completely to the characteristics of profitability , risk and time horizon of the investor.
To put it simply, personalist investment is a type of custom investment.
Characteristics of the personalist investment
Personalistic or customized investment is usually a service offered by financial entities that are dedicated to asset management. Entities that, instead of offering you a financial product or service already created, create one or adapt it for you.
In a customized investment the investor defines all the parameters:
- Amount of risk I want to assume
- How much I hope to win
- How long do I want my investment to last?
- What products do I want to operate with (if you know them)
- In which geographical areas do you want to operate (if you want to decide)
Obviously you can’t ask for pears from the elm. That is, you cannot expect to earn much with very little risk.
In this sense, the entity advises the investor. That is, not only manages the assets according to the indications of the investor, but also advises him in terms of what is attainable and what is not.
Once the parameters have been defined, the entity takes action. That is, following the indications, they look for those investments that meet the requirements.
Of course, since it is a personalist investment, you can change preferences and indications at any time. As long as, of course, it is possible.
Finally, it is worth mentioning that personalist investment is usually more expensive than a standard investment. It is not the same, to invest in an investment fund whose parameters are defined by the manager and are the same for all, than a portfolio made for this purpose according to our indications.
Example of personalist investment
Finally, we will give an example of personalist investment. Of course, this example does not constitute an investment recommendation. It is simply an example of what an investment of this type could be:
I would like to obtain a return of 15%, preferably operating in financial futures on European indexes. The maximum risk I want to assume is 3% monthly and 6% annual. I want a liquid and short term investment.
It is a very simple version of what the indications would be. In any case, the entity that advises the investors or group of investors will conduct a much more comprehensive questionnaire in order to adapt as best as possible to the preferences.