An investment policy is an investment philosophy, main principles to be used of an investor. Investment policy may be written or not, and is needed for the investor to maintain attitudes during market turmoil. Investment policy is similar to investment strategy, but investment strategy is more detailed and includes not only the main principles, but more rules too.
The policy of investment should represent the main guidelines that are followed by investor. Such guidelines should include the level of risk tolerance, main principles of asset allocation and securities picking. Not every retail investor has its investing policy and not everyone needs it. Such policy is more needed for institutional investors that have to follow some rules and have to control their employees from making a mistake.
Investment psychology gains momentum in contemporary business world
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