This is how my portfolio is organized currently.
50% - into companies where I can take a view of at least 18% growth cagr for next 5 years. More or less modelled on learnings from TED. Comfortable to hold roughly 10 companies in this block. %tage holding of each keeps changing depending on valuation and fresh Cash addition. Mostly buy and hold kind…not keen to sell anything from this block.
Main holdings : page, HDFC bank, ITC, Asian paints, gruh…
Have been buying these companies for last 3 years on and off. I am eagerly looking to add more companies in this universe. Recently bought lupin and sun pharma.
40% - into companies where the current growth rate is good but difficult to take a 5 year kind of view. We live quarter by quarter meaning thy require more stringent monitoring. I intend to hold them long period time too but With changing valuation open to sell one member and induct another one. Again 10 companies is the limit in this section and am trying to stick to it. Modelled on learnings from valuepickr.
Exampl: Cera, Atul auto, Kaveri , pi, astral, accelya,bajaj corp, Hawkins,repco, ajanta pharma.
10% - into companies where the conviction is low, but I want to participate nevertheless. Don’t ask why Hopefully my tuition fees is mainly from this section and I can avoid major blunders in the other 2 blocks. But most companies in my portfolio start from this block, as starter position. It takes me time, sometimes months to read up and develop enough conviction to load them up and move them to other 2 blocks. So, it hasn’t been that bad a decision. Other times they get the boot after being in this section for sometime.
No limit on number of holdings. But mostly 5-10.
Example: AstraZeneca (still holding) , navneet publication (sold)