The following are the disadvantages of portfolio management:
- It sometimes leads to over diversification risk by spreading assets over a large area which become uncontrollable.
- It is a very time consuming and
- It is based on historical data which may be inaccurate
Although there are many advantages of portfolio management, there are many disadvantages too. Some of them are:
- Project related issues such as poor visibility, productivity gaps, inefficient handling, etc.
- Complicated as there are different rules for different projects.
- Tax implications and cost of investment are high.
There are many disadvantages of portfolio management such as it is a very time consuming and complicated process. There are different investments and different assets that are taken into account which makes the management and assessment very difficult. Sometimes it leads to inappropriate allocation of resources and tasks. Also, it is a very costly process.
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