A large percentage of my surplus money is kept in trading account to trade my Nifty trend following strategy. What about you ? Where would you park the bulk of your surplus money ?
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Split 50:50 between Trading Account and Investment Portfolio.
If I kept 100% in trading it would incentivize me to trade more often, which is not a bad thing in and of itself, but that’s an opportunity cost I am willing to take to stay balanced. Over time the goal is to shift it to 100% equity holdings
Equity/Mutual Funds form a major portion of my allocated surplus funds. Very small capital in my trading account just in case I see an opportunity. Want to have a good long-term equity portfolio for capital appreciation.
Having said that, also plan to invest in Gold and bonds after a while.
I think initially when there is not a big cash flow one should use the asset class most suitable to ones style of trading/ investing.
Once the cash start flowing you should diversify ( do learn about each asset class first), each time you invest in a new asset class its like diversifying your business no matter how small or big its always good to have MSI ( multiple sources of income) and i think investing in each non corelated markets/ assets do provide that edge.
Yes, I agree with this. If it were for me, I’d park all my surplus money in my savings account (safe bet) and then allocate a portion of it into various other asset classes that I’m familiar with, that would mostly be Equity / Mutual Funds.