My investment theory has evolved over time like most of you. Gone are the days where i was looking for that one hot stock / IPO. I have matured a little more in terms of how i pick my stocks. The theory goes like this
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20 - 30% in cash all the time to ensure that i can take some positions as required in case of a good market condition
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10 % allocated for knee jerk reactions as a very short term play, almost like a trader and not a investor
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20 to 30% allocated to mid to large caps for stability and steady growth
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20% allocated for small cap, growth stories
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rest sprinkled across mutual funds, ETF anddebt instruments.
Reading this doesnt feel like a investment philosophy but rather as capital allocation of your portfolio, but i think the two are very interlinked. Maybe i can come back and write up more later.