PORTFOLIO MANAGEMENT TOOLS: Techniques For Analyzing The Portfolio

Portfolio Management Tools
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The sad reality is that 95% of new products fail. This is why intelligent businesses establish and maintain a portfolio of products ranging from sure-things to passion projects, and daring experiments to sensible spinoffs and expansions. This article will assist you in swiftly comparing and evaluating the top project portfolio management tools and systems for managing a variety of items. We’ll present a couple of the best project portfolio management tools and solutions for managing, organizing, and tracking all of the items in your portfolio. We’ll also go over what you should know concerning portfolio management.

What Are Portfolio Management Tools?

Portfolio management tools are tools that allow you to quickly scan all of the products and services that you and your team provide to better manage, organize, and analyze them.

These tools and software can monitor product growth potential as well as operational risk. They assist you in determining which goods to expand and which to remove.

Best Portfolio Management Tools 

Here’s a list of some of the best project portfolio management tools and software you can use as your portfolio planning tools.

#1. Monday.com

Monday.com was founded in 2012 to assist firms in rapidly scaling. It has thousands of customers by 2015 and has continued to grow well to hundreds of thousands of clients worldwide. 

It is available in 11 languages, has received numerous awards, and is constantly improving the capabilities of its platform. It’s also available on the Google Play and Apple App Stores.

Monday.com is jam-packed with features that help teams tackle everything from small tasks to major projects. 

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#2. ClickUp 

ClickUp can be utilized as a touch point for each of your company’s goods, with stakeholder guest accounts for updates.

It’s one of the project portfolio management tools that include solutions for tasks, collaborative documents, in-app chat, and goal monitoring. It can assist you in managing all of the moving aspects of your project portfolio due to its wide range of functions. ClickUp is utilized by over 800,000 teams at firms such as Samsung, Belmond, Booking.com, and IBM.

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#3. Craft.io

This is one of the portfolio planning tools for digital product managers with a special prioritization engine to highlight the next steps across their portfolio. Craft.io’s drag-and-drop task list assists in organizing your day-to-day workflows and sprints.

It’s a product management tool that includes features for recording feedback, workflow planning, and road mapping. You can set product specifications, prioritize and communicate important choices, and control workload capacity on the platform.

Craft.io can also be your entire production system of record by integrating and collecting fragmented product data. It keeps track of all product information, from stakeholder and team member comments to OKRs, personas, and thematic strategy documentation.

Furthermore, it interacts with Pivotal Tracker, Azure DevOps, Jira, GitLab, Github, Targetprocess, Intercom, Dropbox, Okta, Google Workspace, Active Directory, SAML, Google Drive, and Ping Identity. More integration is accessible through a subscription Zapier account.

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#4. Propel 

This is one of the best portfolio planning tools for product commercialization. It requires ongoing customer feedback. 

Propel is a product lifecycle management (PLM) program that promises faster time to market to its consumers. It has achieved success in the medical, technology, consumer goods, and industrial products industries. It has also achieved success in engineering, operations, supply chain, quality management, sales and marketing, and information technology.

Netsuite, MS Dynamics, SAP, Oracle EBS, Sage, Rootstock Software, QAD, Infor, and Epicor Kinetic ERP are among the ERP systems that Propel interacts with.

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#5. Aha.io 

Over 5,000 companies around the world have relied on Aha.io, a roadmap application, to help them with product management, IT, project management, and more. Aha.io also offers solutions for manufacturing innovation, consumer empathy, and workforce engagement.

Aha.io’s features also allow you to develop custom workflows, allocate resources and budgets, track dependencies with Gantt charts, and visualize progress. It’s ideal for product portfolio management. Its built-in templates make it simple for anyone to get started and keep continuing without having to learn the software first.

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Is Project Portfolio Management A Software?

A project portfolio management tool is a piece of software meant to assist in the management of one or more parts of the project management discipline. Typically, Project Portfolio Management software combines the project-oriented capabilities of Project Management tools with the collaborative aspects of Collaborative platforms.

Managing project ideas and needs is without a doubt one of the most important parts of the PPM process. It is simply important to get it right because investing in the wrong projects is a waste of valuable time and resources. In this regard, a powerful PPM solution with a wide variety of features for managing project ideas and needs can significantly contribute to maximizing the value and return on project investment.

What Are The Tools And Techniques For Analyzing The Portfolio?

Portfolio analysis is one of the areas of investment management that allows market participants to analyze and assess the performance of a portfolio (equities, bonds, alternative investments, etc.). This is done to measure performance on a relative and absolute basis, as well as the risks associated with it.

It computes:

#1. The Overall Return During the Holding Period of an Investment 

That is = (Ending Value-Beginning Value)+Dividends Received/Beginning Value = Holding Period Return

#2. The Arithmetic Mean

It computes the total portfolio’s average returns.

Arithmetic Mean = (R1 + R2 + R3 +……+ Rn) / n

Where R = Returns of Individual Assets

#3. The Sharpe Ratio

It computes the excess return over the risk-free rate per unit of portfolio risk.

The Sharpe Ratio Formula = (Expected Return – Risk-Free rate of return) / Standard Deviation (Volatility)

#4. Alpha

It computes the difference between the actual and expected portfolio returns.

Alpha of portfolio = The Actual rate of return of portfolio –The Expected Rate of Return on Portfolio

#5. Tracking Error

It computes the standard deviation of the excess return concerning the benchmark rate of return.

Tracking Error Formula = Rp – Rb

Where Rp = Return of Portfolio, Rb = Return on Benchmark

#6. The Information Ratio

It determines the success of an active investment management approach by taking excess returns and then dividing them by tracking errors.

Information ratio Formula = (Rp – Rb) / Tracking error

Where Rp = Return of Portfolio, Rb = Return on Benchmark

#7. The Sortino Ratio

It computes the excess return over the risk-free return for each unit of negative asset returns.

Sortino Ratio Formula = (Rp – Rf) / σd

Where Rp = Return of Portfolio, Rf = Risk-Free Rate, σd = standard deviation of negative asset returns

The Five Requirements of Portfolio Management

After looking at how to analyze a portfolio, the next things to consider are the requirements of managing a portfolio. Below are the five requirements of portfolio management.

#1. Examine the Current Situation

For planning the future, investors need to have a clear picture of where they are now and where they want to be. This needs a detailed examination of present assets, liabilities, cash flow, and investments in light of the investor’s primary objectives. 

For the evaluation to find any gaps between the current investment plan and the stated goals, the goals must be clear and easy to measure. This process should include an open discussion about the investor’s values, beliefs, and priorities, which will set the stage for formulating an investment strategy.

Additionally, portfolio planning is not a one-time event; it needs constant evaluations and adjustments as you progress through life’s stages.

#2. Establish Investment Goals

The investor’s risk-return profile is the key to set investment goals. Determining how much risk an investor is willing and able to accept, as well as how much volatility the investor can tolerate, is critical in developing a portfolio strategy. 

Once an acceptable risk-return profile has been defined, benchmarks for tracking the portfolio’s performance can be set. Tracking the performance of the portfolio versus benchmarks enables proper modifications to be made along the way.

#3. Try to Determine Asset Allocation

An investor can build an asset allocation plan using the risk-return profile. The investor can allocate assets in a way that delivers optimal diversity while achieving the expected returns by selecting from various asset classes and investment choices. 

Based on an acceptable range of volatility for the portfolio, the investor can also assign percentages to various asset classes such as stocks, bonds, cash, and alternative assets. The asset allocation plan is built around a picture of the investor’s current situation and goals. Usually, it changes as life does.

For example, when an investor approaches their retirement date, their allocation may shift to reflect a lower tolerance for volatility and risk. Your risk-reward profile will shift over time, with risk becoming less important as you approach retirement.

#4. Choose Investment Options

Individual investments are chosen depending on the asset allocation strategy’s parameters. The precise investment type chosen is mostly determined by the investor’s preference for active or passive management. 

Also, individual stocks and bonds may be included in an actively managed portfolio if there are enough assets to ensure optimal diversity, which is typically more than $1 million in assets. Professionally managed funds, such as mutual funds or exchange-traded funds, can provide the necessary diversity for smaller portfolios. 

An investor could build a passively managed portfolio using index funds from multiple asset classes and economic sectors.

#5. Track, Measure, and Rebalance

After a portfolio plan is put into action, the management process can begin. This includes keeping track of the investments and comparing the portfolio’s performance to the benchmarks. Investment performance must be reported regularly, often quarterly, and the portfolio plan must be reviewed annually. 

The investor’s situation and aspirations are reviewed once a year to see whether there have been any substantial changes. Following that, the portfolio review determines whether the allocation is still on track to reflect the investor’s risk-reward profile. If not, the portfolio can be rebalanced by selling shares that have met their targets and buying equities with higher upside potential.

What Issues Can Project Portfolio Management Tools Solve?

Project Portfolio Management tools assist businesses in avoiding project overload and working on initiatives that are not in line with the overall goal. In other words, project portfolio management tools assist businesses in achieving their objectives without becoming distracted by too many shiny pennies.

How Does PPM Aid in the Development of New Products?

PPM assists businesses in reviewing, evaluating, and prioritizing new product ideas before they become projects. Thereby, allowing time, money, and human resources to be spent on initiatives that support strategic goals. This is becoming increasingly useful and important for businesses that get dozens, if not hundreds, of project bids.


Portfolio management is an effective way for enterprises to manage their products through their development lifecycles, prioritization, gating, and consistent procedures. However, some obstacles can be addressed by the deployment of new processes and a cultural shift. 

Portfolio management is necessary not just to support managerial decisions, but also to make better and faster market judgments on product development. A better way to carry out portfolio management is by making use of the best project portfolio management tools listed above.

Portfolio Management Tools FAQs

How important is project portfolio management tools?

PPM tools help to ensure that only the most useful work is conducted, i.e., work that is most aligned with company objectives.

How does project prioritizing differ from portfolio management?

Project prioritizing is a component of project portfolio management. It’s the aspect of PPM that assists businesses in determining whether they are executing the correct projects


  1. investopedia.com
  2. sciforma.com
  3. theproductmanager.com
  4. wallstreetmojo.com
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