How does Selma manage or adjust my investments?
There are different reasons why Selma adjusts (analyses, buys and sells) your investments:
1. Your financial life changes
There are certain changes in your life that impact your ability to take risk. These changes can be big or small, good or bad – but most importantly they can have some form of impact on your income situation. These changes can include:
- Increase or decrease of income
- Switching or quitting your job, taking a sabbatical, starting to study, getting a large bonus or winning the lottery 🍀
- Deciding to cut costs and thus being able to save more – or the opposite
- Paying back a loan
- Buying or selling an apartment, house, estate, a piece of land, winery, soccer club or any other investment
- Getting settled, married or starting a family
- Starting your own company
- Your willingness to take risk can also change over time. Occasionally, Selma checks how comfortable you are with taking risks and adjusts to your willingness over time – without making hasty changes.
2. Financial market changes
Selma monitors financial markets for you and adjusts your investments, so you don’t have to. Selma is on the lookout for:
- Changes in how capital is distributed around the globe
Selma measures how money is distributed globally across different investment categories, ie. how all the other investors invest money across the globe. In case this changes, Selma adjusts your investments accordingly. Your investment planet always matches the global distribution of investments. Selma will assess if your planet requires rebalancing. This is something Selma monitors periodically and makes changes in your planet automatically.
- Changes in the risk level of your investments
When some of your investments lose and others gain value, the structure of your investment planet shifts and so does the risk level. Selma adjusts to such changes in the markets and buys and sells investments to keep the risk level in check.
- Changes in investments becoming over or undervalued
Selma analyzes the financial information of companies around the world and takes a look at which companies’ stocks are expensive and which are relatively cheap. This is done by comparing stock prices to the profit the companies make. Selma automatically buys more of the investments which are cheap, and sells some of those which are more expensive.
3. You add or take money out
Each time you add money to or withdraw money from your investment planet, we buy or sell investments to make sure your planet’s risk is balanced again.
4. Updates in products
As new investment products are created all the time, better products sometimes become available. If Selma finds a product that is better than the one you currently have in your planet, Selma will automatically replace it.