ValuePickr Forum

Sonia's Protfolio: Requesting Feedback

Hi Value Pickers,

Thanks for all of the members here. Due to all of you only i am able to put this thread here. Request you all to read patiently(Just treat me as a little crawling baby learning to walk)

I am 31 years old working in IT industry in delhi. I am single now(divorced) and plan to spend my rest of life like that only.

I started my investment journey in 2018(due to hype) and burned my hands as most of us who started in 2018(Reason being my investments were news tip based). Thank god i started with (<5% of my networth), so not a lot of damage.

The loss made me more attracted towards market and i started studying more about markets(investment blogs, various valuation models, annual reports, concalls bla bla bla and of course valuepickr). Resulting in information paralysis and not able to invest anymore. For last 1 year i have only got rid of all my 2018 junk holdings.

My investment target is:

  1. Keep the principal safe even if returns are subdued.
  2. Better returns then FD (target between 15-20 %)

My current investments are:

  1. 30% in own_house+own_car
  2. 65% in FD
  3. 5% in mutual funds (large cap 60% and multicap 20% and smallcap 20%) with continuous sip

My investment theme now is(After whatever i have gained knowledge and all):

  1. Wait for a market crash/deep correction and then only buy. (Most important for me)
  2. Keep sitting on cash however tempted you are unless there starts a sale and everyone runs out of market.
  3. Invest in companies with good financials and good cash flows.
  4. Invest in no debt companies with good corporate governance.
  5. Never invest in high PE companies.
  6. Don’t put too much effort in exact valuation (If i do that much i am never able to convince myself to buy that)
  7. Never invest in lumpsum (invest in sip mode)

My plan is to convert my half of FD investments (Not in a hurry), only when sale is there else cash in FD is better. Based on my above investment theme following is the list of companies i have started putting money. Request your valuable feedback here.

protfolio

-Sonia

2 Likes

I think you have too many stocks in the financial sector. I think it would be better if you narrow down to 2-3 stocks based on lending discipline the organisation has. Since you plan to do SIP in these stocks i would suggest you to stick to the sector leaders in the sectors you like. You mostly have sectors that are organised i would also suggest you to pick couple sectors which you believe is moving from organised to unorganized sector and again pick the market leader here. For instance how PVT banks took away the market share from PSU banks in the 2000.

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I like only 5,6,16. I feel at a much cheaper price/when the cycle turns you can consider 3. If you can hold for 10+ years, then add 8 and 10.
3,5,6,8,10,16

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Hi Sonia,
Greetings for the day.

First thing first, you are at right place - VP forum has valuable information and wisdom at so much ease to gain.

My feedback is not related to list of stocks you are invested, but on general aspect.

(a) You are on right path to covert FD part of net-worth into Equity.
(b) By looking at the quoted text above, you mark them as ‘theme’ , my experience says that it is normally not possible to satisfy Sr No3 , 4 as well as Sr No 5. 3,4-logical AND -5 = Null
(c.) That way you seem to be at very basic level in Flying Solo in share market.
(d) However everyone has own style of selecting a company, that way you can have your own set check list on what you mentioned PE , cashflow, debt etc
(e) My experience / advise goes like this . . . Investing in a company whose product / services presence is seen / felt / experienced by investor , is simplest way on buy/hold/sell decision. If it is possible for investor to check products / services of the company and connect with what is available from competition , what is required by customers , how is quality / customer experience - satisfaction - that it imp.

Focusing more towards why the top line of the company will be keep on increasing , is more useful to remain invested. Not all sector / company , we can research in this way - but scuttlebutt various channels, it is possible to monitor to some extent.

This is primary input for keeping company in the list , recommendation , financial debt / cash flow / PE are secondary, Foremost is conviction of the company’s product / services.

regards.

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Its not that easy…our brains are wired in such a way that…when there is a deep correction…we tend to wait further or we dont cash as there is a fear across…so that we can buy still cheap…no one really can time or reach to perfect intrinsic value…

How many would have bought in the last October turmoil??..when your horizon is more…you can still buy quality companies and reasonable valuations

“Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves.” – Peter Lynch

These are not investments. Hence you may want to exclude them from your portfolio. I assume that you will occupy the house and hence it cannot be an investment. Same goes for a car as you are not going to let it out as a cab.

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My investment target is:

  1. Keep the principal safe even if returns are subdued.
  2. Better returns then FD (target between 15-20 %)
    -----------------------------------+++±-

Hi I went through the company you hold. Holding too much financial stocks is bad for self finance. My pick will be only HDFC BANK and BAJAJ FINANCE from financial sector. I could not find any life insurance stock in your portfolio. Those are low beta and less volatile.You can think off. Try to reduce number of cyclical stocks in your portfolio.

15%-20% CAGR return is very optimistic.

Hi Sonia,

Right time to invest in the equities. Equities have its ups and down, always better to start slow and slowly increase exposure as you gain experience, confidence and positive returns.

Invest target - Bang on !!!

I normally like to limit my exposure in equities to 25%…and maybe increase it 35% after 5-10 years as returns increases.

Coming to your portfolio -

  1. Amara Raja - Maruti lately announced plans to make its own battery. Since they command 50% of market share of passenger vehicles, lots of business of maruti might migrate away from Amara.

  2. Ambika Cotton - Decent but nothing great. Much better bets available given the current crash.

  3. TCI - Avoid for me. I doubt it will grow.

Too much exposure to financial sector. Not necessarily reduce stocks but reduce % exposure to it. Pharma (Granules, Aurobindo), 1-2 infra stocks (Capacite Infra, L&T, Dilip Buildcon) , 1-2 commodity stocks should be explored along with other sectors.

Happy Investing :slight_smile:

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Excellent choice of companies. I don’t know if auto has bottomed yet, but if it did these would be the stocks I would hold.

Very wise to have more in FD and doing SIP rather than investing all in one go. One of the best advices I received reading various posts in this forum is to invest debt / equity as a percentage depending on one’s age and current valuations and to never go less than 30% in debt.

I am not convinced by idfc first - which currently looks all promises with very little execution history for now and Titan - simply due to valuations. But that may be just me where I tend to stay away from overheated stocks.

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Welcome Sonia to world of investing … I have one friend holding TCI express friend not alone :smile::slight_smile:

Hope you are investing in FD after you do exhaust the PPF (1.5L) limit . In case married , do include additional 1.5L as well. This is safest of all investment we do and waiting patiently over years , its returns are best in the retirement time for us.

I really like your idea of parking in FD as many people tend to advise against it quoting statistics of how it is loss to us. On the FD , you can look at small finance bank which gives better interest returns . This can be planned based on your risk appetite.

Lastly i am not a fan of stock correction /waiting for certain target etc etc… This wisdom has come to me over years of doing this mistake and realized time and energy wasted which never give proportional returns.

once again welcome to team.

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Hello Madam,
Your investment theme number 5 “Never invest in high
PE companies” doesnt match with your stock picks : Bata, Titan, Bajaj Finance.
What u think about that ?

“Waiting for a market correction” -i would not recommend this strategy

As a wise person said “the markets can remain irrational longer than you can remain solvent”

Nobody knows when a correction will occur and the extent/duration of the correction when it occurs