Amid high volatility on Dalal Street, investors are looking for an ideal portfolio mix for themselves.
Before going ahead, one should understand that investment does not work as a ‘one shoe fits all’ and an investor needs to assess his risk profile, time horizon to hold an investment, goals and income before taking any call.
S Ranganathan, Head of Research,
said that an ideal asset allocation strategy should be in accordance with the risk appetite of any investor.
To solve this dilemma of investors, ETmarkets.com reached out to some of the best-known Dalal Street veterans to find out the ideal allocation strategy of funds for the next year.
Amit Jain, Co-Founder of Ashika Global Family Office Services said that investors should allocate 70% to equity and 20% to debt. The remaining 10% can be invested in gold. In his view, an investor should be fully invested.
Siddarth Bhamre, Research Head, Broking said that bond yields may top out around 7.75-8%. Around these levels, it would be prudent to have some exposure in long-tenure bond funds, say about 30%, according to him.
“One should invest 70% in the equity markets. Within equity, auto, cement, consumer durables, banking would be sectors which should get more weightage than their weightage in benchmark indices,” he added.
Vinod Nair, Head of Research,
suggested investors to hold a decent amount of cash for future allocations. He said that investors need to keep 10-15% cash.
“However, an average investor should allocate 40-60% funds in equities, whereas 25-30% should be put in debt. One can buy gold worth 10%,” he added.
For a middle-aged individual who is a medium-moderate risk taker, Deepak Jasani, Head of Retail Research,
Securities suggested that one can invest 55-60% funds in equities.
He suggested that such categories of investors should allocate 30-35% funds to fixed-income assets, whereas the remaining 10% can be put into gold.
Likewise, Chandrachoodamani from Primeinvestor.in suggested keeping a tilt to Indian equities, with a 60% allocation. Middle-aged investors can put 40% of their investment in debt or fixed-income assets, he advised.
If one is a long-term investor, then equity all the way, assuming age and income levels are not a factor, said Sumit Chanda, Founder & CEO, JARVIS Invest.
“Given the aggressive rate hikes by the central banks, one should look at allocation to debt only when the interest rates start peaking,” he added. “Gold has dropped significantly this year and is expected to ease off some more.”
Tejas Jariwala, Research Head, Jainam Broking remains positive on equity markets. He said that largecap stocks are mainly for lower drawdown and liquidity point of view, and one should keep this allocation in the portfolio.
However, his advice is to allot 60-70% allocation to mid and smallcap stocks, which are available at cheaper valuations along with double-digit earnings growth visibilities for 2-3 years. “Remaining 30-40% can be put in the largecap counters.”
Within the equity space, Siddhartha Khemka, Head – Retail Research,
suggested pouring 60% of funds into largecaps, whereas 30% of the sum can be allocated to midcaps. “Smallcaps will get the remaining 10% share.”
Divam Sharma, Director, Green Portfolio suggested that 70% allocation should be made to equity markets, 20% to debt and the remaining 10% to gold or liquid assets.
Vaibhav Agarwal, Head of Research at Basant Maheshwari Wealth Advisers finds only one relevant asset class — equities. “If you want to preserve your wealth then diversify into equities, bonds, gold and real estate,” he added. “If you want financial freedom, then allocate entirely towards equities.”
Sunil Damania, Chief Investment Officer, MarketsMojo believes that if an investor doesn’t need immediate funds in the next 3-5 years, 80-90% of their asset allocation should tilt towards equity.
“We believe that over a block of 3-5 years, equity would outperform significantly compared to other asset classes,” he added. “Remaining balance can be allocated towards debt and gold, accordingly.”
Vikram Kasat, Head (Advisory), Prabhudas Lilladher said that one should strike a balance between largecaps and smallcaps. “The stocks should have a clear backing of mindful fundamentals based on running themes.”
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
