馃攳
Design a diversified portfolio by using STOCKS, DEBTS, Cryptos (#Bitcoins!) - YouTube
Channel: unknown
[0]
diversification is one of the most
[2]
important
[3]
rules in finance interestingly this
[6]
concept and this very important concept
[8]
in finance
[9]
does not take roots in finance but it
[11]
takes roots in
[12]
literature so you must have heard of the
[14]
saying that don't put
[15]
all your eggs in one basket this proverb
[18]
is used by don quixote by
[20]
miguel d cervantes where the phrase is
[23]
used
[24]
and it reads is the part of a wise man
[26]
to keep himself today for tomorrow and
[28]
not
[29]
venture all his eggs in one basket that
[31]
is where this term
[33]
they don't put all your eggs in one
[35]
basket comes from
[36]
and this is not a finance concept now
[38]
it's used in finance
[40]
and it is one of the principal concepts
[42]
that you need to understand if you want
[44]
to succeed
[45]
in the stock markets so on this video i
[47]
am going to cover
[48]
four simple points about diversification
[51]
that what exactly is diversification
[53]
number two that with the advent of
[55]
cryptocurrencies how you should
[56]
diversify your investment portfolio
[59]
number three we are going to take a look
[60]
at that if you have a capital of 10 000
[62]
or 1 lakh or 10 lakhs
[64]
how you should diversify and how you
[66]
should create that investment pipe
[68]
how much should be allocated in stocks
[70]
versus how much should be allocated in
[72]
debt
[72]
versus cryptocurrencies finally i am
[74]
going to leave you with
[75]
some key points that you should remember
[78]
by uncovering your own
[79]
investment style so let's get this video
[82]
started now very quick word about our
[83]
sponsors from the video which is coin
[85]
switch kuber without whom this video
[87]
would not have been possible
[88]
now they are a crypto investment
[90]
platform they help you buy and sell
[92]
cryptocurrencies
[93]
they have a wonderful ui ux they also
[95]
run a blog called as kuberes where you
[98]
can learn more about crypto investment
[100]
and educate yourself so many of you
[101]
might be tempted to comment that hey
[103]
akshay you would advocate investing in
[105]
cryptocurrencies
[106]
number one i am already a big investor
[108]
in cryptocurrencies but i would never
[110]
advocate anyone to allocate more than
[112]
five to ten percent of their entire
[114]
portfolio in cryptocurrencies
[116]
because that is precisely what even i am
[118]
doing right so i will advocate only
[120]
things that i do
[121]
i will advocate the same things to you
[123]
so first and foremost let us understand
[125]
that what is the meaning of
[126]
diversification
[128]
and why is diversification important
[131]
so diversification essentially means
[133]
your investments should look like a pie
[136]
it should be bifurcated into different
[138]
investment classes
[140]
for example you can have some percentage
[142]
of your portfolio into equities
[144]
right equities are what equities are
[147]
shares
[147]
of the companies or businesses that
[149]
you're buying you will have some
[150]
portfolio in debt
[153]
you should have some portfolio in real
[156]
estate
[159]
you should have some portfolio in
[161]
cryptos
[163]
you should have some portfolio in new
[165]
age instruments like cryptos
[166]
now let me quickly explain that why is
[168]
it that diversification
[170]
is very very very important you must
[172]
have heard of stories in india like this
[174]
that hey
[175]
i bought a flat on an emi and i
[178]
regularly pay
[179]
an emi of 25000 monthly
[182]
i bought this flat three years ago and
[185]
i've been paying my emi regularly
[187]
but my builder has not given me
[189]
possession if you would have heard of
[191]
such stories do
[192]
drop your answers in the comment because
[193]
i myself have heard these stories
[196]
in fact few of my close friends have
[198]
gone through this horrid experience
[200]
where they are paying emis on loans for
[202]
the houses that they have acquired but
[204]
they have not been given possessions of
[205]
those houses
[206]
so this becomes a massive problem and
[208]
this becomes like a back
[209]
breaking problem if you have invested
[212]
almost all your money in buying such a
[214]
house
[214]
so what you are doing in that scenario
[216]
is that your investment pie looks like
[218]
this
[219]
pl estate that hundred percent
[223]
of your investment is a house that's it
[225]
you don't have any other investment beat
[227]
stock be it gold beat crypto currencies
[229]
etc
[230]
and this can become a massive problem
[232]
for you if something bad happens to this
[235]
real estate or the piece of asset or
[238]
investment that you are holding this is
[239]
the
[240]
first key reason why your investment
[242]
portfolio needs to be diversified
[244]
it needs to be bifurcated into different
[246]
asset classes now the second important
[248]
point about diversification is that
[250]
diversification can actually give you
[253]
hedging benefits so what that means is
[255]
that you might have heard that you know
[257]
in some years
[258]
the gold moves up right it is going up
[260]
it is going up then it stabilizes for a
[262]
few years then it comes down
[264]
in the same year so for example let's
[266]
assume and i'm making hypothetical
[268]
numbers so let's say that between 2010
[270]
to 2014 this was a scenario with gold
[273]
cycle
[274]
but you also invested in nifty right and
[276]
nifty went up like this
[278]
so in this period while the gold mostly
[280]
stayed stable
[281]
your nifty or your stock investments
[284]
your stock and mutual fund investments
[286]
they kind of increased so if you're
[288]
diversified you have bought like 25 30
[291]
stocks of your overall portfolio and
[293]
only 15
[294]
gold then this particular asset this
[297]
particular asset
[299]
hedges acid b right so that is the
[301]
benefit of diversification
[303]
therefore a you should diversify across
[307]
asset classes asset classes
[310]
and even within the same asset you must
[313]
diversify
[316]
for example if you're buying stocks then
[318]
don't just buy one single stock and be
[319]
done with it
[320]
diversify and buy a bunch of stocks now
[323]
i'm not saying that go and buy 50 stocks
[325]
but there is a good diversification
[326]
number that you should adopt in your
[328]
portfolio
[329]
given the size of your portfolio so in
[331]
conclusion if you are putting all your
[333]
eggs in one basket and if you are not
[334]
diversifying
[335]
and if that basket falls all your eggs
[338]
or majority of your eggs will break
[339]
which is a bad situation you should not
[341]
put yourself in that situation
[343]
what you should do is that you should
[345]
invest across different asset classes
[348]
and within each asset class you must
[350]
also diversify so this allows you to
[351]
hedge your risk now let us very quickly
[353]
cover major asset classes across which
[356]
you can invest
[357]
so there are five major asset classes
[358]
that you can use to diversify your
[361]
investments
[361]
number one is equities equities are that
[364]
you are buying businesses
[365]
so you are buying itc or hul or if you
[368]
are buying a stock of bajaj finance
[370]
what are you doing you are essentially
[372]
buying a business right
[373]
so you are buying equity and ownership
[375]
in a particular company
[377]
super easy to understand and if you are
[378]
buying equity oriented mutual funds
[380]
your money again gets invested in
[382]
companies like hul itc
[384]
and a bunch of other businesses so
[386]
that's one the second asset class is
[388]
debt debt means that you are investing
[390]
in debt instruments so debt instruments
[392]
are instruments which are giving loan to
[393]
other people
[394]
for example there are big companies and
[396]
governments that take loans from people
[398]
right they call it bonds
[400]
so government will issue a bond and you
[402]
as an investor
[403]
will get a chance to loan out your money
[406]
to the government
[407]
and government will pay you a rate of
[409]
interest so are you an owner of the
[411]
government no
[411]
right you're just giving a loan to the
[413]
government therefore you are investing
[415]
in a
[416]
debt not equity in equity you become an
[418]
owner so this is the second asset class
[420]
the third asset class is real estate
[422]
super simple if you are buying
[423]
commercial property or if you are buying
[425]
rental property then you are
[427]
buying real estate now if you want me to
[429]
make a separate video do comment on the
[431]
real estate i will definitely make a
[432]
very detailed video on that topic
[435]
fourth is commodity so if you want to
[437]
invest in oil or if you want to invest
[439]
in gold
[440]
silver these are commodities now the
[442]
problem with commodity is that number
[443]
one
[444]
taking physical delivery of commodity is
[446]
very difficult for example if you buy a
[448]
physical gold then storing it
[450]
handling it safely that becomes a
[451]
challenge so you should try to buy these
[453]
in our digital format that might be much
[455]
more simpler but the idea is that the
[457]
commodities can give you hedging
[459]
benefits for example when the stock
[460]
market goes down
[462]
people look for safe havens and they
[463]
start investing in gold so gold prices
[466]
go up so if you have invested in gold
[467]
at that point in time you whatever loss
[470]
you are making in the stock market you
[471]
end up making benefits from your gold
[473]
market
[473]
so therefore you should diversify fifth
[475]
and final asset class that i would
[477]
outline are crypto currencies
[478]
so cryptocurrencies are bitcoin ethereum
[481]
and these new age investment instruments
[483]
these could be nfts as well
[485]
so what happens with cryptocurrencies is
[486]
that you are taking a long term
[488]
perspective on the world
[489]
now i am not saying that go and invest
[491]
90 of your salary in cryptocurrencies
[493]
please don't do that that is madness
[495]
but what you should do is that you
[496]
should keep a little bit of portion of
[498]
your entire investment amount for these
[500]
future assets because
[501]
right now the cryptocurrency market is
[503]
like this much
[504]
and the stock market is like this much
[506]
now if the crypto market
[508]
grows to become like stock market 30 40
[510]
years ahead in the future
[512]
then the value that you're holding might
[513]
become 50 x or android x
[515]
that is a huge return on your 5 to 10
[518]
portfolio so i hope you understand the
[519]
available options for you now let me
[521]
quickly show
[522]
in a very brief format that what you
[524]
should do if you have 10 lakh rupees how
[526]
you should go about designing your
[527]
investment portfolio now if you have 10
[529]
lakh rupees then you need to ask
[531]
yourself
[532]
a couple of questions one is that what
[533]
is your age
[535]
right and second is that what is your
[537]
risk appetite
[539]
now if you're generally young then you
[541]
should invest more of your money for
[543]
growth
[544]
right if you are slightly old then you
[547]
should invest
[548]
majority of your money for what for
[550]
regular withdrawals
[551]
so you're looking at stable income flows
[553]
right so for example
[554]
invest in dividend oriented stocks
[557]
because you are getting monthly cash
[558]
flows and you can utilize that to live
[560]
your life
[561]
that's it second if you have age by your
[563]
side then you can
[564]
withstand the dips in the stock market
[567]
for example
[568]
in 2020 when the stock market went down
[571]
and hypothetically speaking if it would
[573]
have taken 10 years for the stock market
[575]
recovery to happen
[576]
and if you have age on your side then
[578]
you can stay put no problem right the
[580]
stock market will come up and if you
[582]
don't have age on your side and if some
[583]
medical emergency comes up when the
[585]
stock market is down
[586]
then you will have to sell your stocks
[588]
at a massive loss to recoup the
[590]
investment
[591]
so that becomes a bad scenario so
[593]
generally speaking if you're young then
[594]
you should invest
[595]
in growth assets and if you are old then
[598]
you should invest in stable assets
[600]
that's the general rule that's one
[602]
second thing that you need to
[603]
superimpose this rule with your risk
[605]
appetite for example if you are someone
[608]
who is a risky investor
[609]
then you can allocate more of your funds
[611]
towards equity cryptocurrencies etc
[613]
if you are somewhat of a risk-free
[615]
investor then you should allocate most
[617]
of your money
[618]
in debt fund and fixed deposits things
[620]
like that
[621]
so please ask yourself these two
[622]
questions that at what age you are
[624]
and what is your risk appetite now let
[626]
me create two profiles and try to
[628]
outline how you should go about
[629]
designing your portfolio
[631]
so let's assume that you are in your 20s
[633]
and you are a balanced
[634]
investor that is neither you are too
[636]
risky and neither you are two risk evers
[638]
right so this is the first category we
[639]
will build a portfolio for
[641]
and second category we can assume that
[643]
people are in their 40s
[644]
people are in their late 40s or early
[647]
50s
[648]
and they too are balanced investors
[650]
right why am i not talking about
[652]
like extreme cases why i'm not talking
[654]
about extremely risky people because
[656]
they should just go and invest all their
[657]
money in cryptos
[658]
and if we are talking about extremely
[660]
risk-free people they should just do fds
[662]
right
[662]
so we are talking about people who are
[664]
mostly in the middle course i can't give
[665]
you an age-by segregation
[667]
so just play along with these numbers
[668]
and the general rules that i am talking
[670]
about
[671]
so essentially what you should do is
[672]
that you are looking to grow your wealth
[674]
right when you are in your 20s early 30s
[677]
or when you are slightly younger so what
[678]
you should do is that you should have 60
[680]
to 70
[681]
money in equities 10 percent in debt
[683]
depending on the market condition if the
[685]
market conditions look stable
[687]
or if the market is in growth phase the
[689]
way it is now keep very little debt
[691]
invest mostly in equities in terms of
[693]
commodity i personally do not own any
[695]
commodities use commodities purely for
[697]
hedging so you can buy gold and silver
[699]
so the stock market tanks you can use
[701]
commodities to hedge that risk
[703]
and remainder should be in growth
[704]
capital like cryptos which are the next
[706]
gen finance so to say
[708]
you might say that you have two points
[709]
one is that you have not spoken about
[711]
real estate so i am personally not too
[712]
bullish on real estate market now if you
[714]
hold a lot of black cash and
[716]
you know all that stuff it's a different
[717]
thing but market in india about real
[719]
estate
[720]
it involves a lot of frictional cost lot
[722]
of taxes bunch of different things so i
[724]
personally would not invest a lot of
[726]
money
[726]
in real estate i do own a few commercial
[728]
properties but that makes a very little
[730]
part of my entire investment portfolio
[732]
that's one second is that akshat can you
[734]
exactly tell us what are you doing so i
[736]
am 90
[737]
here and i am 10 here that's it right
[739]
but that's me right i'm a slightly more
[741]
risky investor
[742]
so that is why i am following this
[743]
philosophy that's a
[745]
second i'm good at futures and options
[747]
so if the market falls
[748]
i know how i can make money right so as
[750]
to offset
[751]
any of the losing equity positions so
[754]
therefore i'm confident about stock
[755]
market bets that i'm making
[757]
therefore i invest heavily in equities
[759]
and cryptos this is something that i
[760]
have said multiple times
[762]
okay now let's move on to scenario b if
[764]
you are someone who requires a regular
[766]
income flow then majority of your money
[769]
should go into debt
[770]
right at least 40 to 50 should go into
[773]
debt
[773]
and in terms of equity you should do at
[776]
least 30 to 40 percent
[779]
right and even in equity you should only
[781]
go with
[782]
large stable blue chip companies that's
[784]
it okay
[786]
the idea is what the idea is to reduce
[788]
volatility
[789]
should you invest in cryptos i don't
[791]
think so right because crypto as a
[793]
market
[794]
it will take long time to stabilize it
[796]
has massive return potential therefore i
[798]
am also investing my money in it
[799]
but the volatility in the crypto market
[801]
is going to be high going forward
[803]
therefore you should only invest in
[805]
stable sources
[806]
so what i would say is that 50 30 and
[809]
then you should take little bit of
[810]
commodity bets
[812]
at 10 to 20 that's it and you are good
[814]
to go so this is what i would say about
[816]
developing your own investment portfolio
[818]
now fourth and final part what are some
[820]
of the key things that you should keep
[821]
in mind
[822]
number one if you are a risky investor
[824]
then equity and cryptocurrencies are a
[825]
great bet for you
[827]
but always hedge always hedge your risks
[830]
either learn about futures and options
[831]
so even if you are
[832]
taking a loss on your equity positions
[834]
you have some way
[835]
of hedging that or invest in commodities
[838]
those are some of the hedging techniques
[839]
that say
[840]
number two please do not look at your
[842]
house as an investment
[844]
okay because if you are living in a
[845]
house and if you get habitual to living
[847]
in a house
[848]
and you are very happy that my house now
[850]
is worth five crores
[851]
it's very unlikely that you are going to
[853]
sell it and move someplace else
[854]
right so please don't consider your
[856]
house in which you are living as an
[857]
investment per say
[858]
you buy a house for living so do not
[861]
consider it as an investment investment
[863]
in traditional sense third point is that
[865]
if you are a risk free investor and if
[866]
you say that yakshat i am just too
[868]
scared of taking risk what you should do
[870]
number one please invest
[872]
a little bit of your money in fd and
[874]
please trust me that please go and
[875]
invest your money
[877]
in passive mutual funds you will be okay
[880]
not a problem right just make monthly
[882]
sips
[883]
and you will do well i will come out
[884]
with a video about dollar cost averaging
[887]
or rupee cost averaging please watch
[888]
that that will help you understand more
[890]
about passive fund index investing
[892]
so please watch that i hope you enjoyed
[894]
this video please give it a thumbs up
[896]
and a comment and i'll see you the next
[900]
[Music]
[907]
time
Most Recent Videos:
You can go back to the homepage right here: Homepage