It’s largely written with keeping in view some normal retail investor in mind who wants to invest with some stock market fund or adviser in India. It further assumes managing lot of funds (funds of funds) or stock markets is nowhere your full time job.
• This is a decision making framework.
• Its made while keeping in mind the assumption
stock markets/fund management (managing
multiple funds) etc are not your full time job –
Largely money will come from your business or job
You want some exposure to stock markets or
growth of Indian businesses thats it – without
risking too much – Since you don’t have time you
hire some adviser or fund manager – Beyond that its
no magic pill.
• I think this decision framework largely applies to
anyone. Obviously Individual case details differ.
Personal Situations are different talk to me
directly for the same.(Your family situation)
• Please revisit this every year on 31st March – To see
what is your situation personally and rebalance.
• You can replace Net worth in the following Chart
with Cash flows
• Each year or Every 2-5 years, Dynamically
1rebalance your portfolio as per point 3 and 1
(Thats how adults do it)
• Each year or Every 2-5 years, Dynamically
rebalance your portfolio as per point 3 and 1
(Thats how adults do it)
• Next time someone comes you with an investment
fund or something just check whether he/she is in
3A or 3B? Plus whether your personal financial
situation or net worth allows you to invest or not –
Then allocate accordingly and increase or decrease
each year accordingly – Check their strategy too
deeply
• My target or how I Run the investments myself – I
myself run Point 3, B kind of conservative investing
strategy. My target is whenever you exit you get
decent returns without much volatility as much as
possible. – If tomorrow you find someone better (or
I underperform very very signficantly) feel free to
reduce exposure to me and invest with him/her.
• Personally for me I need to have greater than 80%
of my investments in the same way – But you dont
need to do the same way.
Why?
There is 3A or 3B, because in most cases the fund
manager will become rich (If the investments are
too volatile) and you wont.
For 3A you yourself need to become funds of funds
manager. Devote significant time for the
management of your funds. If thats not true in your
case dont do it.
If you are having multiple funds in your portfolio now
question, start thinking? Are you in 3A or 3B. What
you want to do and have done? Match these
questions and answers. In Most cases your fund
manager/advisor/distributor will become rich and
you will lose. How do you want to be in the stock
markets? Are your past returns fooling you (Will
you keep on jumping fund managers)?
In Finance, nothing new is ever created, these funds/
advisers/distributors its largely all legal structures
and marketing, in the end the business of finance is
same old poor one.
Appendix:
For pdf of the article kindly download from below
Exit Strategy 