My goal for 2024 was to minimalise my portfolio and for that am making a change to my Equity Portfolio. I already post my monthly SIPs and stock buys on SIR’s Telegram (@InvestRepeat). I am publishing this portfolio update so that my son/daughter can read it when they’re capable of reading and can learn from my experiences, successes and mistakes.
I am a DIY investor who loves to keep his portfolio as simple & as boring as possible. If you’re reading this in the hope of getting the next best trading tip or next best meme coin which will 100X your portfolio – you’ll be disappointed. Anyway, I divide my entire portfolio into ‘Risk Fund’ and ‘Safe Fund’ which I have already shared in my 2023 Audit. In this, I will only talk about my ‘Risk Fund’ and show you my current preferred allocation as well as the updated preferred allocation.
Allocation
| Current Allocation | Updated Allocation | |
| Mutual Funds | 49% | 60% |
| Stocks | 15% | 4% |
| Crypto | 9% | 9% |
If I have to dig deeper this is what is happening:
Nasdaq 100
Nifty 50
Nifty Next 50
Nifty Midcap 150
smallcap
20ish different stocks
to
30% Nasdaq 100
20% Nifty Next 50
20% Nifty Midcap 150
10% quant Small Cap
10% Parag Parikh ELSS Tax Saver Fund
10% quant Flexi Cap
In short, going forward I will mostly put my money into just 2 flexi cap mutual funds rather than researching for hours & picking 20 stocks myself. My index fund allocation is not going down but am not going to do fresh investments in Nifty 50 index. Also due to SEBI/RBI ‘capital controls’, Nasdaq 100 invesment may also be paused until they raise overseas limit. So basically a 5/6 fund portfolio will have majority of my net worth. Now there can be some questions reagarding this change,
Why drop Nifty 50?
2 main reasons. First, as the Nifty 50 stocks are already owned by PPFAS & quant Flexi Cap. Second, as per rolling returns basis – Nifty Next 50 consistently stays above Nifty 50, though with higher volatility. My reasoning is both but first is more important than second.
Why Parag Parikh ELSS Tax Saver Fund?
2 reasons here as well. First, I already own it since its came out (few months after NFO). Recently stopped putting more money as moved to New Tax Regime and tax claiming wasn’t required. Second, it has a much smaller AUM than PPFAS’ Flexi Cap & almost has same stocks. I already have foreign exposure with Nasdaq 100 so adding another new fund i.e. Flexi Cap isn’t required for now.
Why quant’s Flexi Cap?
I own their small cap fund for a long time. The best part I like is – similar to index funds quant also try to remove emotions from investing. They are mostly dependent on their data models to pick stocks rather than just fund managers. They kinda chase the “current good thing” rather than buy & hold. And PPFAS’ buy & hold strategy balances with that.
Why choose Active Funds?
Because I never believed in “Passive Vs Active”. I believe in “Passive & Active” strategy at least for markets like India which still has about a decade to mature like US. But despite that in India as well, Index Funds outperform Active Funds in most categories. That’s why my updated allocation is still index heavy. It’s 70% Passive & 30% Active Funds.
What’s that 4% in stocks?
That is considering my stock portfolio that I already have and not planning to sell. I won’t put any significant fresh money into it but here & there randomly if I see or feel like I have good stock – I will invest, but that’s kinda negligible.
Why this overall change?
- Actively picking stocks is a lot of work. And the data is already clear that most active investors won’t be outperforming a simple index fund in a long enough time-frame.
- As I have read more of my religious scriptures it indicates one thing – the only balance that I will carry forward to my next life (if I have one) is my Spiritual Balance.
- Trying to outperfrom the market by picking stocks myself continuously for next 20-30 years is something that I don’t want to spend my time on as the probablity of outperfroming the market is already against me.
- I would rather let fund managers & data models do that for me, who already has a lot more datasets, time, market research etc. to do that.
- I want to spend more time with my family, on my sadhana & travelling to places. My parents are ageing fast & them leaving their mortal body is not very far.
- I am not comfortable in gaining few more % a year than others while compromising on the limited time I get to spend with my family. Also my own time is limited, and I have to increase my spiritual balance as much as possible before this ends.
- In the field of money, I want to increase & optimise my ‘Income’ rather than my ‘Returns’. So the time I would have spent on researching the next stock, I will dedicate to increasing & diversifying my income sources.
- 10k invested for 13.1% and 50k invested for 13%. The later will increase his corpus way faster than trying to manage few basis points.
- Simple buy & hold dosen’t work in this ever changing world. And me getting in & out of stocks is a taxable event. So post tax, beating the market is more diffcult. With mutual funds, there is no tax if they change stock holdings.
The goal of my updated portfolio is to make my monthly investing more simple, boring and dumb. I will keep putting more money every single month in these funds regardless of price & noise. With stocks I had to time the market which lead to a drastic increase in my cash holding that I shared on my 2023 Audit. And data is also very clear – Never time the market. I want to mostly stay invested and this portfolio will require less timing the market, simply putting in money in these 5/6 funds will be enough to generate massive wealth for me.
If you have made it this far, want to remind you again – I write these for my son/daughter. For others, please don’t take this as investment advice; am not a SEBI-registered investment advisor. You should do your own research and/or contact an RIA.
Never forget, Save Invest Repeat is our life mantra.
If you have any questions please do send them at @InvestRepeat on X. Also, you can join my private Telegram channel (Username: InvestRepeat).
Your dad,
SIR
