Liquidated my investment for real estate purchase in Dec 2017 and after a gap of more than two years from Dec 2017 till March 2020, I have started my equity investment from April 2020 in a phased manner from the available saving.
Challenges faced during this investment phase.
Unsure how the market will play out hence not ready to deploy all my savings, instead chosen to deploy capital at a phased manner. Since the market was moving up I could only average up and I was deploying larger capital with gaining confidence in market. This made my portfolio returns look below par.
Initially was maintaining four portfolios 1. Core Portfolio (Large cap - Leaders), 2. Value Portfolio (Large cap - at good valuations) 3. Growth Portfolio (Midcap and Small cap) 4. Contrarian Portfolio (Companies affected by Covid). And after much analysis and reading decided to have only Core Portfolio and sold other portfolio companies. This is to have higher allocation as well as have concentrated bet. More importantly I have less companies to track also since these are Large cap leaders in their segment I will have good sleep at night.
Portfolio Design Strategy
The Core Portfolio was designed as copy cat portfolio of my twitter gurus from whom I have learned a lot during this Covid imposed lock down.
Based on the suggested company from my twitter following I have narrowed the investment company by comparing the allocation of my suggested company across three index. 1. ind_Nifty50_Value20 2. ind_Nifty100LowVolatility30list 3. ind_nifty50list . Selecting only the suggested companies with higher allocation in a sector for investment.
Heath care companies are selected based on a different approach. The approach is not to look for pure pharma company rather look for other healthcare company in the supply chain. Thus arrived at API, CDMO, CRM businesses. And selected the leaders in this business.
Future Plans:
I still have some capital left with me and I will deploy them in a phased manner till the end of this year.
Also planning to add United Spirits or HDFC Life in future if it comes at attractive price. Will add only one from these stocks which will have minimum 5 percent allocation.
Also from next year I will do SIP in this portfolio.
Will review the portfolio quarterly and will make changes to the allocation.
Criteria for exiting a stock. Consistent financial under-performance when compared to peers for 6 quarters or major disruption.
Expectation from this portfolio
Minimum two times the risk free returns in a five year time horizon.
Good sleep at night
Malaiâs Copy Cat Portfolio
S.No
Stock Name
Inspired From
Alloc%
Comments
1
ASIANPAINT
@MarcellusInvest
7.5
Leader in Paint
2
BRITANNIA
@FI_InvestIndia
7.5
Leader in its segment Food(biscuit, waffels, etc)
3
DIVISLAB
@MarcellusInvest
7.5
Leader in API manufacturing
4
HDFC
@MarcellusInvest
7.5
Leader in Housing loans
5
HDFCBANK
@MarcellusInvest
7.5
Leader in Private Banks
6
HINDUNILVR
Own
7.5
Leader in homecare and beauty products
7
ITC
@dmuthuk
7.5
Leader in Cigarattes
8
NESTLEIND
@MarcellusInvest
7.5
Leader in baby products and noodels
9
PIDILITIND
@MarcellusInvest
7.5
Leader in adheseives
10
RELIANCE
Own
10
Dream big
11
SYNGENE
@unseenvalue
7.5
Leader in Biologics API manufactuirng + Contract Manaufacturing
donât expect more than 12-15% CAGR from this, these fund managers make a decent fee. it doesnât make sense to invest in these companies when you only have 800-900K.
but it makes a lot of sense to invest in these companies if the size is 1 Cr +.
Divis lab, syngene, Tcs and RIL could show some stagnancy and/or cyclical aspect. HDFC, although best, is a lending NBFC. Others all are all season players!
Thanks for sharing the article on Hawkins. Looks interesting. For now I am not looking for any mid-cap or small-cap stocks. Who knows maybe couple of years down the road I would allocate some percentage for mid cap and small cap leaders in my portfolio.
Even the biggest companies in his chosen portfolio like TCS and RIL have given much better cagr that you quoted in last 10 years. Others like Pidilite, nestle, britannia have been excellent. Althought history would not define the future, What makes you come to this figure? Just investing in small caps or hot names do not warranty better returnsâŠcan you elaborate on details and how you invest with example if possible. Thanks
I like your simplistic approach and I think you would be able to reach your target unless something unpredictable happens again (in which case, everyone else would also be in the more or less the same boat as you.)
Currently most stocks are considered âover valuedâ but the same was said also last year, last quarter and last month. That does not prevent the whole stock market from going further up.
Thanks for your time in visiting this thread and sharing your feedback. I intend to keep this portfolio for at least 10 years with continuous SIP investment for another 2 years at least. I have seen your recent portfolio which shares my portfolio stocks as well. Cheers and Good luck!!!
Monthly Portfolio Updates:
Took new tracking position in Abbot India
Added investment to few stocks(ITC, Biocon and Britannia) only as the market is expensive
December SIP is put on hold due to unforeseen medical expenses
Dec 2020 Monthly Portfolio Update: New addition: None Deletion: Reliance, Britannia, HUL and McDowellâs (Rationale: Cut your losers/laggards) Cash position: 26.25%
When I think of financials I rank HDFC, Kotak, Bajaj in that order, I exited Kotak and Bajaj in order to reduce the no of holdings. I understand your point âconcentration riskâ . I will think about it, thanks for your pointer.
Hi. Can you explain why not ?
HDFC stocks are bluest of blue chip stocks . They often beat their peers in every factor. I have always had the same question in my mind but I couldnât find an answer although I donât understand why do i even need to have this question.
