Your success as an investor primarily depends on how well you construct your portfolio; which is made up of a set of different financial asset classes, and structured in such a way that mitigates risk while maximising the potential for gain to help you achieve your financial goals. Creating your portfolio involves looking through a sea of possible investments and identifying those assets that suit your profile as an investor, and procuring the right weightage across different classes. In general, there are 4 steps you need to follow to develop a sound and profitable portfolio. They are: 

1. Determining the assets that are apt for you
2. Purchasing the assets and realising your portfolio
3. Reassessing particular investment weightages
4. Rebalancing your portfolio

1. Determining the assets that are apt for you:
   The first thing you need to be able to do is clearly articulate your current financial position and a list of the goals you want to achieve. This will help you determine the right mix of assets to procure in order to meet your target amount. Here, you should consider factors like your age, the amount of money you are willing to invest, the time available to grow your investment and how these factors may change in the future. After this you should think about what your personality as an investor is, and how your risk tolerance is affected by that; a risk vs. return trade-off. Are you willing to be a more aggressive investor with sizable contributions in equity, or would you prefer to be a more conservative expect assured returns? In this regard, consulting an experienced and certified financial advisor can make the process of asset allocation much more efficient.

2. Purchasing the assets to achieve your portfolio:
   Once you have ascertained the right proportion of assets in different classes, the next step is purchasing them to achieve your portfolio. This involves dividing up your corpus for the particular classes of assets that you need. While deciding on equities and bonds, you may want to break them down further into subclasses, since there will be differences in the associated risks and potential returns. For example you can divide equity investments between a variety of industrial sectors, companies that hold different market caps, and between stocks of foreign and domestic companies; while the bond portion might be allocated between the short-term and long-term, government debt and corporate debt, etc. You can consider Mutual funds and Exchange Traded Funds as ways to achieve your portfolio.

3. Reassessing particular investment weightages:
   Once your investment portfolio has been created, you will have to rebalance your allocations periodically, as fluctuation in prices can cause your required weightage across classes to vary. Apart from this, changes in your financial situation, investment requirements and risk tolerance may also prompt you to reassess your investment weightages and rebalance them where necessary.

4. Rebalancing your portfolio:
   The last step involves determining which securities you need to reduce or increase and by how much, and executing the change. You can then rebalance your portfolio by gathering proceeds to put into your underweighted securities by selling units from those that are in excess. While you are reviewing and adjusting your portfolio remember to keep in mind the tax implications of buying and selling assets at that particular time. Let’s say your investment in growth stocks has done well and you then want to sell them to rebalance your portfolio subsequently; but this will cause you to incur sizable capital gains taxes. So then it may be a better option to simply stop making new contributions to that class of assets (equity) while continuing to purchase units in other asset classes. On the other hand, you should also consider the outlook of your allocation. Using the same example, if you suspect that the value of the same growth stocks might fall, you may want to sell regardless of the tax implications.

By following these steps, you can build a portfolio that suits your profile as an investor and is profitable at the same time.