When I left my last job in 2015 my portfolio size was around 2Cr+, and I felt it was sufficient. The corpus fell by 70% in 2018 crash . So obviously it wasnât enough but I could recover over next few years. Since I invest in micro/small caps, I have started factoring in a 50% cut at portfolio level anytime.
I have 99% of my assets in equities. I donât count the house where I live as an asset as I am not going to sell it in any case .
I focus on growing the portfolio not doing any tax planning. Whatever need to paid will be paid at the right time.
I pull out money from the same bucket for my expensesâŚdonât try to go for dividend yielding stocks as returns are much lower there.
Post covid rally propelled the portfolio to the next orbit and I can say I am comfortable with what I have.
Being a full time investor is a full time commitment to your own investments. You take the risk and you get rewarded for it. Itâs not a ticket to freedom. Only freedom you have is you can allocate your time as you wish and take a break when you want. But I feel I am working more than what I used to do when I was a full time employee.
Finally the journey has been very rewarding for me. I could spend a lot more time with my family during the last decade and that is a invaluable.
@raj1968 , Nice journeyâŚIf you could elaborate on ur stock picking strategies and if you are maintaining your portfolio thread, pls point to it or share here. Also most of us, including me, are always confused about how much to invest through mutual funds and how much through direct stocks? What has been ur proportions and your views on it. Also pls share your long term CAGR from 2015 till today, from when u left the job.
@Mudit.Kushalvardhan
I primarily invest in small/microcap companies. I try to find small companies with a niche, which hasnât found much market attention as yet. A new sector, a management change, capital infusion by management etcâŚdraws my attention to the company. I do not look at the parameters like ROE/ROCE with a strict lens. Rather I would try to see if they are going to improve in future from here. I always look for growth and off course companies making profit with reasonable valuation. At a high level this is my strategy.
I used to have a portfolio thread earlier but over a period of time realized that itâs better not to put it in public domain because of various reason, so itâs dormant now.
I don not invest in MF. All I do is direct equity investing. Itâs always 100% in direct equity. I enjoy the journey of finding stocks and then the thrill of winning/losing money on my bets keeps me excited and going.
My CAGR is decent enough in last 10 years (more than satisfactory, I can say ). Post covid rally gave it even a further boost.
99% of networth in smallcap & microcap investment. Are you not bothered about such a risky strategy. Dont you think at least 1 Cr or 10% of NW should be in safe bond or atleast in Nifty?
Are you invested 99% from the very beginning of your investment journey or you took more risk when your networth crossed certain amount.
Nice strategy to gain most alpha. Finding cheap micro and smallcap is not easy in current markets but once you find at good valuation with long term outlook intact it can generate a large wealth.
My CAGR from 2013 when i started serious investing is close to 45% and last 5 years CAGR is roughly 120%. Portfolio still down 8% in last one year. I look for turnaround cases and build large positions. Top three holdings makes close to 40-45% of portfolio. Strategy paid off well till now. Rotation of capital is key to me as you never know when market favourite stock becomes market villian.
I believe in hated stocks portfolio which is out if favour due to some temporary issue or punished by markets. This ensures high safety of margin in a drawdown. Only companies above 5000 cr market cap as of now. All SME exchange, IPOâs, Microcap, smallcap, maximum midcap are at inflated valuations despite severe fall in last 2-3 months. GST cuts are welcome steps by Govt but its too late to implement, it could have been done 2 years back.
EV sector, Solar sector, Capital Goods, Chemical will consolidate for long. IT sector will see their worst days ahead. IT index will shrink more in coming days.
Some of your observations look logical. Many Mid caps and Small Caps with âNo Growthâ are also trading at premium valuations and Time correction is happening in many of those.
âHaving a hated stocks portfolio which is out if favour due to some temporary issue or punished by markets. This ensures high safety of margin in a draw downâ is quite different from what most investors might be doing. UPL is one such case which has turned around in past few quartrers and there could be more such cases as well.
Capital Goods and Chemicals are still in consolidation stage, and may take few more quarters to show good EPS growth.
I have a different view about IT sector. Generally when margins start impacting, there will be rationalization of workforce and generally it reverses the trends i.e. margins start improving. I have seen this quite a few times in last decade. There is a high possibility that, it can happen again and IT stocks may see some upward movement due to small P/E expansion or at least P/E may not shrink more from here. Let us see what happens!!
Mudit,
I would like to present my view of MF VS Equity proportion based on my experience as its a common dilemma always
I started with both MF (SIP in 1 Large Cap & 1 Mid & Small Cap via a Advisor) & Equity with some understanding from Valuepickr on my own 12 yrs back in a proportion which doesnât impact my annual expenses,
It was going well till 2018 and then Equity gave -ve returns after 5-6 yrs, so relooked at my Equity Strategy, dug deeper and tried to develop some mental framework ( not too much a sector as i was 45% NBFC and Banks in 2018, avoid Headwinds sector, Niche OR Fast growing company in a Tailwind sector still to follow it as impulse take over , not journalling in detail etc), important to develop some criteria for selection, entry and exit, your expectation
After Tax Cut for Corporates in 2019, my Equity pickings started doing well as Markets too, had 40 percent drawdown in Covid( Long term thinking so took it easy) and i started slowly withdrawing from MF into stocks and completely exited them by 2021-22
Good Sample checklist to follow
Important is to try everything, see what works and what needs changes,
I am a diversified investor and not concentrated as thats what my personality is
Few Options which i think are as follows
If short of time, advisable to get done via MF/Advisor(Wealth Management, PMS, AIF etc)
If want Research report and invest, plenty out there too, had HitPicks subscription for a year in 2020-21, opted out as i canât take actions on Frequent Basis and my personal orientation is a year or more atleast in my pickings
If want to join some forums( SOIC, Technofundainvesting, ScientificInvesting, Tar wrap etc), its good for networking & joining their weekly/Session calls and they have started having City meets too for some of them
If want to rely on some known friends who has good record, try taking their help too as Mentor
DIY Investing : Screener, Ridewinners, Tar wrap, stockscans, StockEdge are also good tools for scanning ideas and doing own research and actions
Join some city meetups via VP forum OR known persons on social media for Networking too - I attended a few in last 6-7 months and i think it has helped me make few friends ,expanded my thinking and broadened my knowledge base
Direct equity needs time, monitoring and busy folks needs to do any of above to suceed
Note : Not an endorsement for any particular one mentioned here, but my observation as i had/have subscriptions/seeing videos etc and know them better to provide feedback
This is phenominal and unbelievable return Charat! 45% over long period of time! I will look up your posts on your approach. Feel free to redirect me to a relevant post from which I can learn about your approach to picking stocks and investing in general
Hi @dvdinesh thanks for your words. Position sizing of your winners is most important, i feel capital allocation is most important if u want to make big. Fortunately i was able to identify atleast 2 large alpha creators in last 4 years. Have some misfired bets also which created a major dent.
This is indeed powerful if get right. In hindsight many times feel capital allocation could have been better.
Capital allocation combined with risk management would be key to make & preserve wealth. It comes with experience & time. One must not jump with high allocations in pursuit of quick results without right experience & understanding. Higher allocation must be result of higher conviction and greater experience rather than need to generate quick & greater wealth!
I maybe wrong in my assessments above as in most of my picks I would have generated much more with greater allocations, but still the overall experience & psyche generates above thoughts in mindâŚ
Congratulate @Cshar to have got one of the most difficult aspect of investing right!
This is absolutely right in my opinion but most tough task to implement. As per my experience, if my capital allocation would have been high for winning stories, CAGR would have been much higher but conservative approach has resulted in good but not great CAGR for my portfolio.
If you see a stock is undervalued, you tend to think that, Mr. Market has priced it low since it knows some thing which you do not know, but often you are proven wrong. This is the area of improvement for many investors.
@Investor_No_1 experience come by paying heavy tution feeâ:joy:. I just give you three example
In 2013, i was just exploring the returns you make while holding stock for long term, i bought madhucon projects and Gayatri projects. Still remember i bought 20000 stocks of Madhucon project at 10 rupees and even had put my whole month salary, Madhucon rise to 80 in 18 months, sold around 65 as stock was not sustaining also Gayatri Project made 5X gains, both companies are bankrupt now, saved myself due to habit of rotation. Learning, Infra sector or companies where Govt is involved is risky. Infra companies canât be bought for wealth creation due to inherent corruption involved, one project delay or payment delay and whole equity is wiped out
Burnt my fingers in reliance power as i found it cheap at 20 and it became dirt cheap at 4, sold at 3 during covid as that capital was very important at that time. Yes bank used to be my favourite stock, was holding large chunk in Jan 20 had seen 250 in yes bank and stayed put as Rakesh Jhunjhunwala also bought, sold it at 10 rupees. Never bought Infra company and Banks after that in last 5 years. I still believe banks are the most riskiest investments as you will never know when your long term gains will be wiped out while u sleep. 2nd learning.
Took a large bet on ABFRL demerger as stock quoted 360 before demerger in Nov 24 and 291 in April, promotor bought at 317, post demerger stocks combined value listed was 260 and slipped to 220, still hold both stocks ABLBL and ABFRL as i feel after GST branded apparel can make a comeback. It took me three months to cut losses and switch to other potential bets.
This is pitfall of large bets, AB Capital and Force Motors filled the gap as AB Cap was 10% of PF in march 2025 when i doubled quantities and its 20% of portfolio right now, from 160 it has moved to 306 and force raised to 17000 where i sold fully.
Its safe mode rightnow to wait & watch. Markets are painful from July onwards and stocks are moving in a range with downward bais, still difficult to predict a clear sector winner as maximum sectors have played out over last 4 years. Rise of Eternal, cartrade, Swiggy, Naayka like businesses which are cash flow deprived and will remain cash flow hungry for long long time shows where we are heading. GST cuts has put a hope on consumption hence betting large on consumption as valuations are cheap and risk reward ratio is high.
You have talked about the failure stories related to stock picking. What about the success stories, ofcourse you will have several multibaggers to sustain a CAGR of 45%. How concentrated did your portfolio end up due to outperformance of few stocks in your portfolio?
Force Motors 1200 to 17000, Tata Motors 68 to 850, Kalyan Jeweller 110 to 715, SHIL 75 to 470, AGI Green 210 to 1000, VodaIdea 3.5 to 12, LT Foods 150 to 450, Wockhardt 600 to 1350(still holding 17% , AB Cap average 123 to 310(long term, still holding, 20%). PCBL 75 to 240. Madhucon Project 10 to 65, Gayatri Project 200 to 1000, PG Electro 35 to 120(bought very early, sold early). Shoppers stop 270 to 710. Apollo Tyre 84 to 245.
My top three bets comprise 40-50% of portfolio, all bets performed in last 4 years apart from ABFRL.
Heavy rotation, i still remember, i sold Kalyan Jeweller full quantities in a week when it raised to 780 and HSBC and Motilal gave a buy call for 840, stock quoted at 126 PE and dropped to 415 in a freefall.
. So obviously it wasnât enough but I could recover over next few years. Since I invest in micro/small caps, I have started factoring in a 50% cut at portfolio level anytime.
.
). Post covid rally gave it even a further boost.