Building a Portfolio Plan
Upon successfully constructing your portfolio model, you can begin executing portfolio optimizations. Essentially, portfolio optimizations create more possibilities for every dollar you invest, resulting in an increased potential for profit.
Step 1: Setup
The setup for the portfolio model is identical to that of a single segment.
Starting Point: The plan can be connected to either the model or another simulated plan.
Date Range: The start date is fixed based on the starting point, while the end date must fall within a year or less from the start date.
Steps 2-5: Constraints
You can apply constraints at three different levels at the portfolio level:
Overall constraints: These are broad objectives that the entire simulation must fulfill.
Segment constraints: These limit the expenditure for a particular segment.
Tactic constraints: These dictate specific investment requirements for a tactic.
Step 2: Plan Overall Objective
You can set one of five objectives for a portfolio segment, which function similarly to those in single segments.
Optimize Fixed Budget
Hit Revenue Target
Max Profit
Forecast a Plan
Status Quo
Step 3: Segment Investment Constraints
You can set an investment limit on any segment or segment portfolio (e.g. a group of segments).
It is essential that your segment investment constraints do not clash with the overall objective.
Where you have nested portfolios, the constraint will apply to all segments within the nested portfolio.
Step 5: Tactic Constraints
You can set constraints for all your tactics in the same manner as you would at the single-segment level.
The segment selector enables you to navigate through each segment to set the constraints.
Portfolio Tactics: Portfolio tactics can be located in their own segment within the selector. If you have nested portfolios with tactics, you’ll see each one listed here.
The features for uploading financials and investment details are relative to the segment selector; they operate based on the selected segment.
Step 6: Business Environment
The setup for the business environment is almost the same as that for a single segment, except for the segment selector.
The segment selector lets you navigate through each segment to view and modify your environment data.
The upload feature operates relative to the segment selector when launching any modal; it functions based on the selected segment.
Step 7: Simulate
After setting all your constraints, you can simulate your plan.