LearningToInvest.com has created five sample portfolios, suitable for investors from aggressive to risk-adverse. The portfolios use ishares to illustrate the distribution, as these funds are useful for investors with any size portfolio.

• Aggressive
• Moderate Aggressive
• Middle
• Conservative
• Risk-Adverse

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1. Make sure you understand the securities market. Read one of our recommended books in our book center, post questions to our message board, and read our course.
2. Assess your risk tolerance. Start out with our risk evaluation test. It will provide you with general guidelines on your individual risk tolerance.
3. Assign percentages to security types (bonds or stocks, cap size, nation, etc.). Use our portfolios as general templates. Most importantly, remember our rules of diversification; diversify worldwide, inter-industry, intra-industry. See our editorial section for defining true diversification.
4. Locate securities to fill in your portfolio framework. Be sure that every security fits the portfolio characteristics you are seeking. For stocks remember that they are not just numbers (i.e. P/E ratios, earnings per share) but actual companies. Buy stocks in companies you are a customer (either directly or indirectly), after all if you buy their products chances are so will other people. For mutual funds target no-load funds. Strongly consider using exchange traded funds, such as the ishares family.
5. Locate a broker. Use a discount broker either online or traditional. After you go through the educational process of building a portfolio you will know just as much as any full service broker.
6. Once your portfolio is in place monitor the performance. Use dividends to make sure the allocation of your portfolio is close to your starting percentages. Don't sell stocks for a bad earnings report, a broker downgrade, or if it is just doing well. Sell only if the reason you purchased it has changed. For example, if Gillette stops making razors and starts making dictionaries, it is not an appropriate choice for your consumer products section of your portfolio. Sell it and replace it with a company with similar characteristics.
7. Use a similar index to measure your portfolio's performance. For large-caps use the S&P 500, mid-caps use the S&P 400, small-caps use the Russell 2000, bonds use the Lehman Aggregate Bond Index.
8. Most importantly, sit back and watch your portfolio grow. Avoid drastic changes!

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