asset allocation Archives

September 22, 2021August 18, 2023

Should I stop SIP at Market High?

The stock markets are making all-time highs. Many think – too fast, too soon! We could sense that all those questions are back such as should I stop my SIPs? Or should I pull out money invested in my funds? Is the time right to add more funds to stocks? Or should invest in gold/real estate? Now the problem arises is that what should be done to find the correct answers for above stated what shall be done. Investing success is about 99% temperament and only 1% about where you invest.

We have huge ocean of investment avenues and various hot ideas that keep floating around, the question is how to react in such times. It is very well said, “Your biggest enemy is yourself.” That’s where thought process of investors comes into picture. Think of a state of mind as a predefined thinking guide but not as a shortcut to meet goals. It is something that makes you behave in a certain manner.

As far as investing and wealth is concerned, the model that works is Asset Allocation. It acts as a FOMO antidote. For your information, FOMO is Feeling of Missing out. At any time, it is difficult to know which investment is best. Asset Allocation allows us to take a chunk of several avenues that is worth investing in and market cycles does wonders.

Any investor rebalances with time, to check that did the portfolio was a thumb-up or a thumb-down. Don’t stress on the positioning of the market, or if product is expensive to get into or get out of. The idea of allocating in various types of investments wherein few can be highly volatile, & others less. Some active, some passive. It helps you diversify which encourages prudence, risk management and good investment practices.

We live in a world of Volatility, Uncertainty, Complexity and Ambiguity. A diversified portfolio, it acts as a cushion from the impact of unknowns. Investor is aware that there is a chance of finding comfort as the other ones are working towards long term accumulation.

It gets you to act. The portfolio is to be rebalanced periodically based on the rules set before, without getting mixed up in present emotions. It helps in getting Behavioral Alpha. Investments when managed well, the alpha is assured. One never pulls out of markets when it’s all-time high. One never stops SIPs. Invest when there is blood around. One should patiently move from one asset to another, without a fuss.

VSRK suggests that even when markets are at all-time highs, our experts tells us to continue investments as per allocations. Be active in SIPs. Rebalancing of asset allocation is better but one can sell the chunk of the money that is needed urgently. For lumpsum investing, consider the kind of a stomach you have in terms of funds and risk appetite.

September 9, 2021August 18, 2023

Joyous God Mangalmurti Ganesha brings Prosperity in Investments

The god who is an epitome of knowledge and abundance of wisdom & is always worshipped before initiating any work. Let’s start our investment planning with an inspiration for proper financial planning through attributes and techniques of his stature.

Wisdom from Big Head

The bigger head represents broad-mindedness, forward thinking, and a vast ocean of knowledge. It emphasizes on the ability to grasp and understand markets open mindedly, prudent thoughts, and seek knowledge will help one look at all the options and make wiser investment decisions.

Draw up a smart goal-based financial plan and wisely act on it to secure your future. Anticipate how investment would grow after say 5-10 years considering the effect of inflation on different investment avenues and accordingly choose the type of Investment Avenue.

Big Ears symbolizes good listening skills

He is named Surpakarna for his large ears which indicate that in order to be a good investor, one must be a good listener. A good investor keeps ears wide open to sound financial advice which is ethical, unbiased, experienced, and research-backed from VSRK to make better investment decisions.

Listening in unification with wisdom will enable you to filter and choose the right. Focus on requirements, aspirations, and desires in terms of your financial goals, investment horizon, financial standing, age, and risk profile, and the number of years left for the completion of your goal.

Focus from the Eyes

The sharp small eyes teaches to have focused approach and looking at the details with concentration to achieve growth. One should focus on individual or family goal-based investment plan. A focused mind to have a clear objective of “where to invest”. Consider safety and returns as foremost requisites.

Carefully create a well-diversified strategic portfolio based on your asset allocation that will strive to beat the inflation and accomplish your financial goals. Eliminate the unnecessary noise of the herd with a holistic view and a long-term approach helps to maintain and grow wealth.

Adaptability from the Trunk

The lord is known as Vakratundaya for the flexibility of trunk representing adaptable nature and to follow what is righteous. As an investor, one should track and review investment portfolio to check its performance contribution to the journey of wealth creation. Evaluate portfolio on a regular basis to know when to be patient about holding on to a particular investment and when it’s time to change it.

One-Tusk Removes Evil

Ekdantaya is another name for Lord Ganesha which symbolises plucking out the evil from the good. Investors based on market news and stock sensitivity do not realize holding on to the underperformers in portfolio which is equally damaging as the removal of a worthy investment from your portfolio.

Greater endurance with large stomach

Vighnaharta signifies keeping all the negativity away and managing every kind of obstacle that comes in the path of life. This is a vital trait that we can definitely benefit from if we strive for gaining more courage and bravery in the face of adversities.

The enormous brook of Lord Ganesha teaches to alphabetize the investments as eating meal in small bites. Investments should in accordance to risk appetite, age factor, & financial goals. It is always suggested to invest systematically and diligently via the SIP route; gradually increase the amount as per financial capacity. With the rupee-cost averaging in volatile markets and the power of compounding, the money will grow over time. One should maintain a contingency fund and undergo both financial and emotional trauma during harsh or extraordinary circumstances.

Not being biased from Axe

The axe possessed by Ganesha acknowledges not to fall quest to sentiments or any sort of biases during investments. Think logically and freely, keeping aside the undercurrents of market downswings. Never discontinue SIP during this time frame and never harbor any anchoring bias to any investment that is unhealthy for financial well-being.

Feet positioning to maintain Balance

Lord’s one feet rests on the ground and another is folded. One can learn to maintain balance in life between inner happiness and materialistic happiness. To lead a contented and happy life, one needs to maintain a balance between material and spiritual needs and invest seeking all the financial needs or goals.

Simple living from his Vahana

The tiny mouse is represented as the vehicle of Lord Ganesha. It demonstrates the most important lesson of life: Simple living, high thinking. Learn to flourish within means; saving more than spending, avoiding impulsive purchases via instant gratification. Invest wisely empowering to yearn for a better tomorrow with a prospering financial plan.

Riddhi-Siddhi suggests to know the Payback timings

The Lord Ganesha preaching wisdom symbolises that every investment plan is not meant for retirement life, there are various short term goals too. So, understand the need for finance and earn cash from your investment in desired period.

Happy Ganesh Chaturthi!

September 4, 2021August 18, 2023

WHAT NEXT WHEN MARKET TOUCHES 17K

The Indian equity markets have ended on a record high. The 30-share Sensex rose 514 points to end at 57,852 while the 50-pack Nifty settled at 17,234, up 158 points. This has led to many of the readers and investors wondering, what next?

It’s simple really! VSRK has always maintained that successful investing depends more on ‘Time in the market’ as opposed to ‘Timing the market’. While valuations and prices are absolutely significant, it is more important for investors to spend time with high-quality businesses than time their ups and downs. Around 50 stocks that have rallied over 500% in the last few years bear testimony to this.

The questions still remain unanswered: Is the market going to rise further or is it going to fall? One should be a pessimist and wait or cheer up and invest right away?

Waiting for a market correction to start investing would result in a loss of opportunity. This is the only reason why one should get going ASAP. If one will wait for some correction, surely will stay dwell. Therefore, one should invest. Even at a market high, the markets are only going to go higher in the long-term orientation. One can expect a few jerks on the way, but the general market course is going to be largely upward-looking. But remember, Investing should be played for a long-term.

Step #1: Avoid the temptation of booking profits!

Equity as an asset class is habitual of giving superior returns in the long term due to the power of compounding. VSRK insists & helps in cutting the losses short and riding on winners. This selling rule is deeply embedded in our policy. You should always have an investment plan and remain disciplined.

Step #2: Asset allocation is important

The fact remains intact that market volatility affects your portfolio’s asset allocation. It could be possible that your portfolio is composed only of small-cap or mid-cap stocks. In up trending market, a concentrated portfolio may increase chances of loses. One should diversify when the markets are really high. Diversification means flexible market capitalization. The best way to keep your portfolio up to date is by utilizing an active investment strategy such as VSRK.

Step #3: Get rid of under-performing investments

When you initially constructed a portfolio, markets must have been quite different. Now that considerable time has elapsed, chances are that the valuations have changed. The reasons that made you buy those particular stocks might no longer exist. The market leaders might have changed ranks. In such a situation, sticking to laggards can result in losses. So, use this time to review your entire portfolio and weed out stocks that don’t seem valuable anymore.

Step #4: Invest according to a proven investment strategy

It is rightly said that a plan without a strategy is merely a vision. Investing in accordance with a strategy can help you achieve your various financial goals and understanding your risk appetite will keep you away from making impulsive or ill-informed investment decisions based on greed and fear. VSRK is a smart investment strategy that is complete with selling rules and can help you invest in accordance with your risk appetite.

Step #5: Consult your Investment Advisor

The art of investing includes doing the basics of investing right i.e. knowing how much to invest for your goals, where to invest, understanding your risk appetite, proper asset allocation and re-balancing, investing systematically and remaining disciplined in your plan irrespective of market conditions.

An investment advisor can not only help you understand your financial objectives but will also help you curate your equity portfolio in order to achieve those objectives. An advisor will act as a guiding light in navigating your way through the volatility of financial markets.

All said and done, market highs and market lows shall come and go. The volatility shouldn’t bother long-term investors. You should always aim to keep an eye on your goals and invest in a systematic manner. VSRK would be delighted to assist you in your investment journey so that you can fulfil all your financial goals.

February 5, 2021August 19, 2023

5 Things You Should Know Before You Start Investing

Investment is not a one-step process but an entire series of steps taken to reach the financial goal. It encompasses making various financial decisions and finding the right investment alternative while minimizing any associated risks. Investing is affected by a large number of factors, so it is crucial to keep in mind some financial aspects. Today we will talk about five things you should consider before you leap.

Know Your Investment Goals
Every person who is desirous of investing should have a stated purpose of investment. It could be anything like buying a house, new car, child education and marriage or planning retirement. You should know what you want to save your money for and especially how much you want to save. Your investment goals are a crucial factor to decide the investment alternatives.

Know Your Financial Condition
Any investor, whether she is a billionaire or a new associate in a law firm, has some financial limitations. It is necessary to know how much would you be able to invest in the said period of investment. The purpose of investing funds would be to generate sufficient returns to help you achieve your financial goals, whatever they are. So, it is necessary to know how much investment you would be able to support and where you can cut corners.

Know the Importance of Emergency Funds
One of the main reasons why investments fail is that people consider their investment as emergency funds. However, this is never the case. For example, when you start a fund for buying a new house, then that money is being kept aside for buying that new house only. Now, what people do is that whenever they face any financial emergency, they break these funds, thereby hampering the investment cycle. Such acts lead to lower accumulated wealth. These emergencies, as the name suggests sprung anytime and you have no control over them. So, it is always advisable to consider an emergency fund. It would safeguard you in case of any mishap.

Know Your Asset Allocation
There are various investment avenues available in the market. You can invest in precious metals like gold & silver, stocks, bonds, mutual funds, real estate or a combination of all of the above. You may or may not want to invest in all of them. Each of them has its risks, rewards and characteristics. Therefore, you should be well aware of the investment avenues you have selected. Knowing each kind of investment avenue helps you to create a diversified portfolio and enhances your chances to reach your financial goals.

Know Your Risk Appetite
When someone wants to invest his money, there are majorly only two things in his mind. First is the reward and second is the associated risk of investment into that avenue. Every person has a different risk appetite depending upon his age, financial situation, priorities, etc. You should identify the level of risk you are willing to take to achieve your financial goals. This factor is one of the main aspects when you choose your investment avenues. People who have a high-risk appetite go for equity funds; they are risky but give good returns to its investors. Debt mutual funds are safer but provide low returns and are suitable for people with low-risk appetite. Hybrid mutual funds are known to yield better returns than debt funds and are less risky than equity funds, so they are suitable for moderate risk-takers.

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Tag: asset allocation

Joyous God Mangalmurti Ganesha brings Prosperity in Investments

Feet positioning to maintain Balance

Riddhi-Siddhi suggests to know the Payback timings

5 Things You Should Know Before You Start Investing

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