Go and book profit/loss on your entire portfolio. Start MF investment using STP route or keep money in cash and start building MP folio (max 5) using SIP route.
Now still if you want to re-enter in market
Consider this as learning fee. Within next 10 years you will find yourself as successful investor.
Latest Portfolio
SOLD all other ones at average loss of -26.2 % …Realized that Quality in mgmt is very important…changed the strategy…
New picks seem nice. How do you allocate capital?
You can have either equal weight or market cap weight or conviction based portfolio. You can read the Capital allocation framework thread here.
Good to see Quality Portfolio!
Now provide one liner thesis against each pick and provide allocation percentage so it will be helpful for fellow members to comment.
Now start going through valuable threads like Capital Allocation, Hitesh Portfolio etc on Valuepickr and it will help to build your framework.
Happy New Year and happy investment journey!!!
This holding is much better.you can review PEL in view of it’s debt and exposure to real estate
No point holding Pidilite, Reliance and Marico at such low percentage. These are high conviction, high allocation kind of bets. They will never be a hundred bagger or 10 bagger for decades. So the current percentage you hold will not make any meaningful impact to your portfolio.
Dont understand below words
Please elaborate
100 bagger is multiplying your investment by 100 times. For example, for reliance to be a 100 bagger, it’s market cap should be $13.7 trillion. Considering only a couple of stocks have ever reached $1trillion market cap, it is unlikely that the stocks you have 1% of will ever reach 100 times the current value.
Latest Portpolio Update:
SOLD: Bajaj Auto with 15 % + Returns ( Felt 20 % CAGR cant not be expected)
Reliance with 100 % returns ( Felt Higher PE ).
L & TH —No loss or no Gain Sell----Felt Better opportunities available than this…moved to Pokarna
Wrong Selling: CDSL ( To early SOLD…Lesson Learned) with just 10 % Gain.
DIVIS --Sold partially with 150 % returns.
Added Below:
NBFC ( Instead of One stock Added Bunch)—Chola, HDFC, Ujjivan, Arman Finance Bajaj Finance( All are equally distributed).
IT----------------------------------------------------------HCL, TCS, INFY, L & T I and Mphasis, Mindtree ( All IT stocks with Equal distributed)
Banking-------------------------------------------------Bandhan, Axis, Kotak ,CUB,AU small finance and CAN fin ( All are equally distributed)
Chemical----------------------------------------------Aarti , PI Industries and Vinati ( All are equally distributed)
Manufacturing-----------------------------------Mayur, Philips Carbon and Nocil ( All re equally distributed)
Pharma -------------------------------Laurus, syngene,Divis,Sun, Solara, Strides, Alkem, Alembic ,Neuland, Shilpa Medicare ( All are equally distributed)
Auto ------SSWL
FMCG------------------- Marico and Zyudss well, DMART ( All are equally distributed)—Planning to keep for next 10 years
Real Estate and Adhesives----Ashiana, Pokarna ( Felt huge update possible bacause of real estate boob in USA), PIDILITE
Ecommerce—India Mart ( Planning to keep for next 10 years)
Engineering Services: LTTS ( Planning to keep it for next 10 years), RITES
AMC—HDFCAMC ( Planning to keep for next 10 years)
Insurance: ICIC LOMBOARD, HDFC Life ( Planning to keep for next 10 yrs)
Overall Portfolio in Green with 23 % ( In March 2020 to April 2020–It was down by -14 %). By that March time I fully invested…No powder available to add during melt down Keep calm…and stay invested…nothing else done …Added some money recently ( In Dec and Jan ) in existing stocks.
Most of companies --I selected based on following parameters.
Now I need help on below questions which I get on everyday.
Please help me how to decrease my portfolio stocks to 15.
Thank you for reading my post.
Disclosure: I am not recommending any stocks, here…May have bias on selected stocks…please do your due diligence…
I would like to provide you my two cents as we have the same thought process in terms of chasing the current momentum and backing strong companies and market leaders.
First easy process to reduce your exposure in terms of number of stocks would be to choose the top player in your basket. Make sure that you are not overpaying for the top player. While it may work to choose HDFC and HDFC Bank in NBFC and Banks, I would not recommend buying HUL or Asian Paints simply because of their unjustified valuation. If you are not comfortable with just one stock then, get the top stock plus one two in your specific criteria.
Then, I would say there is no need to spread our exposure to too many sectors. Currently I am exposed to 5 sectors. Banking as it is a turnaround story and chemical, IT and pharma as they are the current flavour of the market and insurance being a sunrise sector. You could do a similar exercise to limit your exposure to 4 or 5 sectors that you are comfortable with.
Third, I would ask you to be sceptical about certain sectors and totally avoid them if possible. These sectors would be auto, infra and real estate which are cyclical and hotels, PSUs and airplanes etc which in my memory has never performed.
This would automatically reduce the number of stocks in your portfolio.
One last consideration would be to avoid high PE stocks, but it could backfire and a lot of quality stocks are always on a high PE. For this I compare growth rate with PE. If the profit grows more than 30% with long runway then we can buy high PE stocks. Otherwise better to avoid.
You have chosen market leaders in sunrise sectors (ICICI Lombard, HDFC life insurance, Indiamart and HDFC AMC) which i feel is a good winning formula. Just watch out for disruptions as these are highly valued.
There is a much simple and tax efficient way to reduce the number of stocks in your portfolio.
First you have to agree with me on these points:
So, just don’t sell any stock for 3 years. After 3 years some stocks will give excellent returns, some will give average and some poor returns.
Select a desired portfolio allocation say 1% below which you will sell the stock. Add the amount gained to the winners or new companies you selected. The portfolio will become concentrated automatically with time. Index works the same way except quarterly rebalance. Since you will be selling losers you won’t have to pay any tax also.
Just to have more clarity on my approach…I am copying my portpolio here…
| Chemicals | |||||
|---|---|---|---|---|---|
| Instrument | Avg. cost | LTP | Net chg. | Invested % OF total portpolio | |
| AARTIIND | 998.04 | 1159.25 | 16.15 | 1.35% | |
| BODALCHEM | 108.43 | 70.9 | -34.61 | 1.00% | Planning to Sell-Feeling to add in other existing companies only. |
| PIDILITIND | 1488.47 | 1670.25 | 12.21 | 2.00% | |
| PIIND | 1387.12 | 2022.5 | 45.81 | 2% | |
| VINATIORGA | 1185.56 | 1216.3 | 2.59 | 1% | |
| 7.35% | |||||
| Pharma & API | |||||
| AJANTPHARM | 1590.35 | 1761 | 10.73 | 1.48% | Planning to keep for next 10 years |
| ALKEM | 2463 | 3006.95 | 22.08 | 1% | |
| HESTERBIO | 1485.3 | 1684.2 | 13.39 | 1.00% | |
| LAURUSLABS | 191.37 | 345.35 | 80.46 | 2.00% | |
| NEULANDLAB | 962.12 | 1289.25 | 34 | 1.00% | |
| PEL | 1495.29 | 1311.6 | -12.28 | 2.00% | |
| SHILPAMED | 555.69 | 422.5 | -23.97 | 1% | |
| SOLARA | 942.7 | 1485.5 | 57.58 | 1.00% | |
| STAR | 607.61 | 819 | 34.79 | 1.50% | |
| SYNGENE | 354.74 | 570 | 60.68 | 2.00% | Planning to keep for next 10 years |
| Sun Pharma | 611 | 584 | 2.00% | ||
| 15.98% | |||||
| NBFCs | |||||
| ARMANFIN | 380.81 | 700.3 | 83.9 | 1.10% | |
| CANFINHOME | 484.22 | 479.6 | -0.95 | 1% | |
| HDFC | 1932.25 | 2377.8 | 23.06 | 1% | Planning to keep for next 10 yrs |
| Chola | 193 | 419 | 112% | 1% | Planning to keep for next 10 yrs |
| 4.00% | |||||
| Real estate & infrastructure & Engineering services | |||||
| All are planning to sell at some point ( Less than 3 yrs view) | |||||
| ASHIANA | 111.81 | 101.55 | -9.18 | 7.89% | |
| BIRLACORPN | 729.88 | 718.85 | -1.51 | 1% | |
| FINOLEXIND | 433.06 | 581 | 34.16 | 2.00% | |
| POKARNA | 178.2 | 204.05 | 14.51 | 2.00% | |
| NCC | 36.38 | 58.95 | 62.04 | 2% | |
| RITES | 277.74 | 253.95 | -8.57 | 2.00% | |
| 14.99% | |||||
| Banks | |||||
| Planning to keep all of them next 10 yrs | |||||
| AUBANK | 728.7 | 873.05 | 19.81 | 1% | |
| AXISBANK | 677.8 | 663.5 | -2.11 | 1.50% | |
| BAJFINANCE | 3201.73 | 4735.95 | 47.92 | 2% | |
| BANDHANBNK | 401.87 | 309.45 | -23 | 1.11% | |
| CUB | 140.73 | 169.25 | 20.27 | 1.00% | |
| KOTAKBANK | 1450.82 | 1710.3 | 17.89 | 2% | |
| 9.00% | |||||
| FMCG and Retail | |||||
| Planning to keep all of them next 10 yrs | |||||
| DMART | 2211.2 | 2651.5 | 19.91 | 1% | |
| MARICO | 317.88 | 415.6 | 30.74 | 1% | |
| RELAXO | 664.06 | 823.7 | 24.04 | 1% | |
| ZYDUSWELL | 1530.93 | 1932.55 | 26.23 | 1.00% | |
| 4.00% | |||||
| GAS | |||||
| Planning to sell in next 2 or 3 years | |||||
| GSPL | 209.72 | 198 | -5.59 | 1.10% | |
| GUJGASLTD | 288.39 | 370.25 | 28.38 | 1% | |
| 2.00% | |||||
| IT and IT Engineering services | |||||
| Planning to keep most of them for next 10 yrs | |||||
| HCLTECH | 926.47 | 914.95 | -1.24 | 1.00% | |
| INDIAMART | 2350.53 | 7802.55 | 231.95 | 3.50% | |
| INFY | 1018.67 | 1239.65 | 21.69 | 1% | |
| LTI | 1751.82 | 3963.9 | 126.27 | 2% | |
| LTTS | 1415.2 | 2433.9 | 71.98 | 2.00% | |
| MINDTREE | 1431.66 | 1645.15 | 14.91 | 1% | |
| MPHASIS | 1215.46 | 1533.65 | 26.18 | 1.00% | |
| STLTECH | 207.43 | 180 | -13.22 | 2% | |
| TATAELXSI | 2512.33 | 2690.6 | 7.1 | 0% | |
| TCS | 2587.78 | 3112.9 | 20.29 | 1.00% | |
| TECHM | 853.76 | 961.65 | 12.64 | 1% | |
| 15.75% | |||||
| Auto | |||||
| Planning to sell all of them in next 2 years | |||||
| JKTYRE | 69.73 | 127.25 | 82.48 | 1.00% | |
| SCHAEFFLER | 4851.16 | 4298.7 | -11.39 | 1.00% | |
| SSWL | 854.4 | 576.35 | -32.54 | 3% | |
| 5.00% | |||||
| Manufacturing | |||||
| Planning to seel when Capex results exhausted | |||||
| MAYURUNIQ | 264 | 279.4 | 5.83 | 2.00% | |
| NOCIL | 140.38 | 143.1 | 1.93 | 2% | |
| PHILIPCARB | 133.18 | 191 | 43.42 | 1% | |
| 5.00% | |||||
| Steel | |||||
| Planning to sell when it becomes Price to book reaches high | |||||
| SAIL | 54.21 | 57.65 | 6.35 | 2% | |
| 2.00% | |||||
| Insurance | |||||
| Planning to keep next 10 yrs | |||||
| HDFCLIFE | 697.99 | 677.95 | -2.87 | 1% | |
| ICICIGI | 1277.74 | 1317.7 | 3.13 | 1% | |
| 2% | |||||
| AMC Related | |||||
| Planning to keep next 10 yrs | |||||
| HDFCAMC | 2578.27 | 2878.95 | 11.66 | 5.00% | |
| 5% | |||||
| Paper & Media & Misllaneous | |||||
| Planning to sell on all of them in next 2 or 3 yrs | |||||
| WONDERLA | 299 | 200.45 | -32.96 | 0.90% | Planning to sell Wonderla as early as posssible |
| WSTCSTPAPR | 222.64 | 178 | -20.05 | 1% | |
| GAEL | 73.58 | 142.65 | 93.87 | 3% | |
| TV18BRDCST | 36.89 | 28 | -24.1 | 3.00% | |
| 7.83% |
I am struggling to keep less than 20 stocks…But I want to decrease the way that I did in AMC, insurance…sectors…Please advise your valuable inputs.
@hitesh2710, Hitesh Sir, Please advise with your inputs…
I think the simplest approach to reducing the number of stocks is to stick to companies wherein you have highest conviction and then gradually reduce the tail.
Looking at the holdings you put up and the comments, I think the highest conviction companies would be easy to seperate by the comments like “plan to hold for next 10 years or plan to hold for next X years”.
You can also try and see the sustainability, predictability and run way in each company in your portfolio and try to decide which companies you want to stick to.
Trimming started … WONDERLA Sold. Don’t see compuding effect in wonderla as same as other portfolio companies… decided to move to insurance companies … feeling long run way available in insurance area with compounding effect.
Disclosure : I am not Sebi research analyst. Views may be biased… take your own reasearch
Sold Strides pharm with + 45 return… felt in this good era of api and Pharma boom… not good results
Disc I am not Sebi research analyst. My views may be biased
Trimming continues: Finolex Industries Sold with +50 Returns ( Felt Promoter disturbance is not good, unknown unknown kind of situation…dont want to stay…so SOLD.)
Moved the same to CERA.
Disc: Not a SEBI Research Analyst… Take your own research…My views may be biased.
Trimming Continued: SAIL SOLD with +100% Returns…Scheffler SOLD with 9% Resturns…Bhandhan Bank SOLD with -15% Loss
Reasons to SOLD: SAIL—Can not guess when cycle will end…,felt to book decent returns
Scheffler: Auto and Industrial slow down…Still growth is there …but felt below two more chances to grow…than Scheffler…
Bhandhan Bank: Felt moving to Kotak will be better due to better Asset quality and better ratios…and also better Management… SOLD and moved to KOTAK
BUY: TCI Express and PRAJ industries.
TCI Express: All Manufacturing boom will help logistics to grow.
PRAJ: Ethanol Expert which is Rapid growth coming up and also, going to grow in biotechnology area as well.
Disc: NOT a SEBI Research Analyst …My views may be biased.
Did you reach your target number of stocks of 20? If not no point in adding new ones unless its for short term or from trading point of view. Else you will be adding to existing list. One will always tempted or find some other sector or stock moving. Just personal thought
Lot of trimming pending from my end.
Pending Items:
But at appropriate time and at decent price…( Still hoping these will grow to my expectation of price).
I have set of stocks which I want to keep for long term ( Around 20 stocks)… Whatever I sold Most of the chunk moving to these long term stocks.
To answer your question: I have not yet reached 20 stocks…but I am building those 20 stocks…in those stocks PRaj and TCI express came into list…Which I can keep for next 5 to 10 yrs…
SOLD : Pokarna ( 50 % Returns) , GAEL ( 100 % Returns),
Trying to move the funds to HDFC AMC. Not yet decided…Trying to understand more on HDFC AMC and AMC business.
