One particular aspect you always iterate is the draw down. Did you see anyone losing much unexpectedly or did it happen with you, or you just consider this possibility and are always prepared for it, draw down is an integral part of your system, you are prepared for it?
I may have witnessed a draw down on the overall investment PF but don’t remember giving it much thought or even looked at it as a draw down, and may be as it was the PF intended for long term with good stocks which happened to go down with the markets, they may have eventually returned to profits.
I have an account with Icici Bank and the daily limit is 10 lack. Just for clarity - talking about online and retail customer and NOT GOING TO BRANCH AND DOING RTGS Manually. Never heard of any bank allowing RTGS for 1 crore in India online per day.
Quote from Icici Bank website
RTGS Limit: The minimum RTGS limit is Rs. 2 lakh. The maximum amount for RTGS fund transfer is Rs. 10 lakh.
I just moved some capital to stock futures, a small but sizeable part. Futures needs decent starting capital unlike cash. To keep initial capital low while testing out things i took double risk per trade and reduced max number of trades. Per backtest, this did not impact DD much.
A series of random things ( ex some winners missed out because lot size was too high and replaced with losers), banned futures, execution issues etc resulted in much worse performance in sept. And once everything was fixed up to handle all of this, i got tough Oct - toughest month in last 3 years for this set of rules. Futures capital ended up 30% down very quickly while cash was comfortable at around 9%. This does not impact me much as my other system did fine and has much more capital allocated right now, – but what i am saying is things can degrade very quickly. We have to manage risk. Its very hard to recover from large DD if by chance your system also stops working.
I have read in few places, Andrea Unger one of them i think, that in the long run people who control risk tend to survive. Things happen.
But and hold investment in diversified portfolio is fine, add more when in deep DD.
I have ICICI bank account. Limits can be increased, talk with your RM, RM told me where to look in website. Its in some odd place i don’t remember. Had noted it somewhere, but cant find it. I have transferred much higher than 10L on single day. Don’t need it anymore because of pledging, but still every settlement i do more than 10L through RTGS. I do it from pc, not through branch.
Edit from your link -
RTGS (Internet Banking) - Applicable for NRIs as well
01:00 hours – 19:00 hours
Maximum Rs 10 lakh or Rs 1 crore (based on customer segment)
I can understand the executional aspect and hence have another demat account, but not clear on
Whatever your capital better to diversify holdings - how does having two broker account mean diversify? The user need to pay charges twice right or no?
I understand what you are saying, and even started to think on those lines, taking care of the losses, refining the system, which hopefully will yield better results.
As I have said earlier, if the PF is big, why bother about shelling a few more thousand? One can keep the real long term holdings with bigger brokers, the kind of brokers with names ‘too big to fail’, and keep other holdings with someone else.
Technical difficulties may happen with a broker, I have faced that just today morning, I did not get the OTP for some time, I had to wait. Long term holdings are not visible to the eye, so no urge to tinker with that (it happens to some). A sense of relief, a sense of assurance etc.
I don’t have a big PF, so all my holdings are with one broker.
It is only when we are afraid of losing what we have, we will get the feeling of protecting it
I find comfort in knowing my holdings are spread using more than one broker. And its not about lakhs or crores - how big an amount is to someone is relative after all.
Yes. It will be considered as LTCG. You will get the benefit of period of holding as long as title is not TRANSFERRED.
Let me put it this way. If you buy a house by taking a housing loan for 15 years and then sell it in the 16th year. Won’t you take indexation benefit for 16 years. Same logic holds good here.
It’s the safest way when you want to invest a huge amount. I too have my investments spread out across brokers with good reputation like finvasia and upstox. Therefore, I feel at peace.
