The word "portfolio" is just a general term used to describe a group of assets.
You might consider a 401k your retirement portfolio.
Or, you might consider your 401k, Bank of America savings account, and E*Trade investing account as your investment portfolio.
Either way, managing the total amount of money in your account(s) is called portfolio sizing.
At first, you'll just be working with your current account balance (the amount you have already deposited). Your "management" will simply be how often and how much you deposit into that account.
You may think that the bigger your portfolio, the better - how can more money be a bad thing? Unfortunately, that is not always true. Growing the size of your accounts is definitely the right direction, but not when you violates any of the 10 principles of safe investing.
In particular, Principle #2 (always protect against losses) and #7 (constantly pursue ways to reduce costs) come to mind.
In both cases, consider the following factors when you're evaluating the size of your portfolio:
You could say that one aspect of portfolio sizing is as easy as making sure your account balance is ALWAYS above the minimum. It's also the only surefire way to avoid minimum balance fees.
When you're figuring out how much money to deposit in an account, keep in mind that your portfolio size will move up and down over the year. Size your account so that one large loss or withdrawal will not put you below this limit.
Safe Investing Tip:
Your minimum portfolio size may be defined by your investment broker, depending on the type of investing strategy you want to use. For example, TradeKing and TD Ameritrade have different account balance requirements for different types of option trading.
The advantage of this insurance is that you don't need to do anything. Just make sure that your bank is part of the insurance program (Check out the FDIC's Bank Finder - https://research.fdic.gov/bankfind/).
Or if you prefer the brick and mortar approach, look for this sign:
Recently, the FDIC increased their coverage limits (through December 31, 2013). You can find more information about these increased limits at FDIC.gov or by clicking here (http://www.fdic.gov/deposit/deposits/index.html.)
The FDIC also created an "insurance estimator" that can quickly tell you how much of your money is covered. Click here to open the tool in a new window.
FDIC insurance does NOT cover stocks, bonds, mutual funds, life insurance policies, annuities or other investment vehicles.
The SIPC was created to pay back account holders if their investment broker goes into bankruptcy.
The SIPC is NOT the same as the FDIC. The government does not "insure" investment accounts, and only certain financial assets can be "claimed" (cash, stocks, and bonds).
Basically, the SIPC is a reserve fund that can be used to reimburse claims up to a maximum of $500,000 (including a maximum of $100,000 for cash holdings).
If you decide to put more than $500,000 into an investment account, you may not be reimbursed for that extra money. If you file a claim for more than $500,000, the SIPC can only provide you reimbursement using the funds it is able to recover from the bankrupt brokerage.