With the election over, people use the winning slogans to mean whatever you want them to mean and in this case John Heinzl (jheinzl@globeandmail.com) use the slogan to talk about your portfolio in the article Make your portfolio great again.

The assumption is the average investor started with the best of intentions and over time has parts of the portfolio which could be fixed. If you were to adjust your portfolio you would need to take the following into consideration:

1. Sell those pooches – if your shares which are at best speculative or are in broken companies whose prices are closer to bottom, it is time to sell. Some of the reasons to sell included using your money for a better alternative or be in cash; the rules allow capital losses to offset capital gains (save money on taxes); the best stock pickers are only 50% correct, but they know when to sell; selling is not a bad thing.

2. Stop trying to break even – sometimes you buy shares and the price goes down, but you bought for a reason and the events pass. You still you hold onto the stock  because the stock could go up. If the outlook is still not promising, take your lumps and move to alternatives.

3. Focus on Quality – listen to Ford job one is quality. If you start with the best, even if the best have a bad year, it is still a great year for a stock of a lower quality. The stock will have cycles but for it to go dramatically down, the entire market has to go down. Eventually the best stocks rise first. If you add the added attraction of a rising dividend every year, there are plenty of quality stocks which make the grade. Using ETFs because of the their low cost is a good option.

4. Rebalance if necessary – when you bought your portfolio you bought a couple of stocks in different industries or added diversification to your portfolio. If one of the stocks has become a winner and that is great news, it maybe a good time to sell a portion to take profits and rebalance your portfolio to reflect risk reward levels.

5. Consider your costs – if you own mutual funds and there are billions of dollars in funds, try to have the lowest expense ratio, in that fashion if your fund is up most of the gains find a way into your pocket.

6. Consider cash – all the best portfolio managers use cash as an asset allocation. Warren Buffett is famous for generating cash and when the markets go down, he buys large numbers of shares of quality companies. The quality companies move up in the next cycle and he continues to do very well. That took patience, having the resources – cash and faith the cycle will continue so he can benefit. This is the classic buy low, sell high , it usually takes time measured in years to do.

Linking to dividend paying stocks, owning stocks is a good way to grow your wealth and over the long term the best stocks to own are those that pay dividends and can grow them. If you have a reasonably long time frame, the risk reward equation can be very low and that is good for you.

There are more questions than answers, till the next time – to raising questions.