What is an investment portfolio?

An investment portfolio is best defined as a collection of financial assets such as stocks, bonds, and other investments. This collection is strategically assembled to achieve specific investment goals, such as growth, income, or preservation of capital. Each asset within the portfolio serves a different purpose and contributes to the overall risk and return profile.

The other options do not accurately describe an investment portfolio. A list of all debts and liabilities focuses on the negative side of financial management rather than the positive accumulation of assets. A tool for tracking personal expenses and savings pertains more to budgeting and cash flow management, which is distinct from investment strategies. Lastly, a record of all financial transactions made in a year relates to accounting practices, emphasizing transaction history rather than the strategic management of investment assets. Understanding the function of an investment portfolio is crucial for making informed financial decisions and achieving long-term financial objectives.