I wanted to understand how do you guys try to diversify your financial portfolio and how much percentage do you allocate to each of them leaving Equity/F&O.
Below are the options, if you can copy paste it in the reply and tell me the reason how much % and why do you allocate it to that instrument would be very helpful for me to learn. If there any more instruments you guys invest, would love to know about it as well
- Gold - Physical / Soverign / Digital
- Real estate - Residential / Commercial
- FD - Bank / Corporate
- Money back Policies and other different types of policies / LIC
- Mutual Fund - Debt / Equity / Hybrid
- National Pension scheme
- SCSS for senior citizen
- Annuity Plans and Post office saving scheme ( Senior Citizen)
- NCDs / Bonds
- --------- Add yours
Okay it’s hard to say if this would be a 100% answer to your question but here’s a structure of a portfolio that I manage
Let’s start with 100% about 30% is in Gsec which is then pledged and taken back as margins.
10% in corporate Bonds.
About 40% is in equity-related ETFs and some in shares.
And rest is maintained as cash for undervalued opportunities in the equity segment and some for options.
on the note, this is a portfolio that I came up with for someone aged about 50yrs and moderate to aggressive investment style And this is supposed to be more of a fund-like portfolio, not a portfolio to generate regular income but to focus more towards capital gains and wealth preservation.
There’s some money like 5-10% kept idle in the bank in the form of savings and FD to provide as a cushion or as people call it emergency fund
Insurance is Term plans no money back or annuity plans.
Nothing in NPS or SCSS or other schemes.
though, once portfolio designing style can be purely subjective and personally biased but would love to see how different people do it.
I’m now really curious in how your guy’s money management or wealth preservation ideologies are
@Jason_Castelino @viswaram @Meher_Smaran @ShubhS9 @neha1101 @AlgoEye @11.11 @t7support @jashjacob
In relative terms.
Equity 40 percent.
Debt 20 percent
Real estate 20 Percent
Gold 20 percent
Overall, I will take anything above 15 percent cagr.
PS: I am risk averse.
Edit: I keep changing the proportions based on periodic review. Like, right now my equity exposure is very less. Very negligible.
In a nutshell,
Real estate (having hectares of land and commercial buildings in cities bought by parents and grandparents, so i haven’t invested more in it)
I believe simplicity is the key for success. Having more diversification will make more complexities.
Ah then in that case, my real estate exposure is 0 too.
I’m actually bearish in real estates. That’s why i haven’t invested more in it. I’m kind of a more risk taking person.
Like @Chetan_Nahata said here,
debt funds - 70% (mutual funds & gsecs)
real estate - 20% (cannot be really considered as a liquid asset)
FDs, treasuries, PPF, NPS - 5%
Equity - 3-4%
gold - less than 0.1%
cash & savings account emergency fund - rest.
I will rebalance debt to equity only if we have a time or price correction. Or if select stocks provide good bargain. Currently I have stopped all SIPs, will resume only when the current euphoria ends.
I have no view here. But I need a house to stay. I am not gonna sell it and stay for rent.
I used to invest in ELSS for tax saving purpose until last FY. From this FY won’t be investing in these as I will be switching to the new simpler tax regime. My surplus funds are in my trading account which am hoping to grow. Also I have invested in my personal ventures which am hoping will bear fruits.
Note that I can try out this mode because I have the basic and future contingency needs taken care of already.
@jkalathil thats a great answer and I too believe in simplicity is the key for success, on your point about being bearish in real estate, I have one view how I invest in Real estate, you may or may not agree and I understand it is very subjective also
We look at real estate from the point of view of the growth and infrastructure around it and not lock in big money.
Some property which we got in a very different locality is near Panvel in Navi Mumbai where the airport work hasn’t even started and didn’t invest more than 10 lakhs similarly in locations like Alibaug, GIFT and UP’s Noida few years back but always tried to put in smaller amounts but good infrastructure and have gotten some very decent returns which I could compare to equity obviously in the last 3 years there is nothing that can be compared to them but still very attractive. I think it is the way you invest understanding your risk profile and the timing is very important tbh
Other than your contingent funds parked aside.
You’re effectively all in on equity where that be in the capital markets or ventures?
Trading Index / commodity / currency derivatives only (no stock investing or trading). 50% parked in liqudbees and pledged thanks to a nudge from @Jason_Castelino and because my current broker allows option buying with pledged margin.
Have your parents bought a whole commercial building ?
Yes, i totally agree to that point.
Yep, not now. Back in 90’s.
As I am young and believe living in the present, I put majority of my savings on equity positional trades and it has worked well for me so far with good returns. To avoid overnight holding risk in future, I will be switching to Intraday trading with my good R:R algos soon. Long term wealth creation investments are secondary for my goal right now.
Thats a very well structured answer, Thanks for sharing @Chetan_Nahata
That’s a great answer, thanks for sharing it.