Managing Investment Holdings – Portfolio Tracking
Planting a garden is Step 1. Watering and weeding it is Step 2. Your portfolio needs maintenance to ensure it stays healthy and aligned with your goals.
What is a Portfolio?
A collection of all your investment assets (Stocks, MFs, Gold, FD, Real Estate).
- Don't view in isolation: Don't just look at "Is my Reliance stock up?". Look at "Is my Total Portfolio up?".
The Art of Rebalancing
Rebalancing means resetting your portfolio to your original Asset Allocation.
Scenario:
- Target Allocation: 50% Equity, 50% Debt.
- Year 1 Bull Market: Equity doubles.
- New Status: 70% Equity, 30% Debt.
- Risk: You are now taking more risk than intended.
Corrective Action (Rebalancing):
- Sell some Equity (Book profits).
- Buy Debt.
- Result: Return to 50:50.
- Magic: This forces you to "Buy Low, Sell High" automatically!
Reviewing Performance
Check your portfolio Once in 6 Months/1 Year. Not daily.
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Benchmarking
- If your Mutual Fund gave 12% return, but Nifty gave 15%, your fund Underperformed.
- If your fund gave -2% but Nifty gave -10%, your fund Outperformed (protected downside).
Consolidated Account Statement (CAS)
- What is it?: A single statement showing ALL your investments (MFs + Demat) across all brokers.
- Source: NSDL/CDSL sends this monthly via email.
- Use: Gives the "Big Picture" view of Net Worth.
When to Sell?
- Goal Achieved: You need the money for the goal (Wedding/House).
- Rebalancing: To restore asset mix.
- Fundamental Change: The company you invested in has turned bad (Fraud/Losses).
- Emergency: Last resort.
Don't sell just because market fell 5% yesterday!
Summary
- Portfolio view: Look at the aggregate, not just individual winners/losers.
- Rebalance: The secret sauce to manage risk and book profits.
- Review: Annually. Avoid over-monitoring (it causes anxiety).
- Benchmark: Compare returns against the market index, not your friend's returns.
Quiz Time! 🎯
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Next Unit: Insurance Planning! 🛡️