The aim is to generate long-term returns by creating a large cap and mid-cap stocks-only portfolio with a SIP focus between INR 25,000 to INR 30,000 per month.Strategy
Buy and Hold investments with a time horizon of at least 5 years in stocks with moderate to high risk and consistent performance.Use Case
This model portfolio is useful for investors who have a periodic pool of money to invest in direct stocks for meeting long-term investment goals. This portfolio comprises investing in direct equities and is meant for investors with moderately high-risk appetites. The portfolio is built primarily from Large Cap stock; however, there is some allocation done to Mid Cap stocks as well.
The portfolio is rebalanced once a quarter to bring back the sectoral allocation at the desired level and for an in-depth stock level check. Portfolio Monitoring
Model Portfolios are monitored monthly to assess any exit/entry required based on market events, significant sector level changes, any company-specific announcement, analyst reports, or any corporate governance issue.Sectoral Allocation and Stock Selection
This model portfolios follow Warren Buffett’s principle where he says that an individual should invest only in the companies whose business they understand. And therefore, “Consumption” is the core theme for constructing this portfolio along with some peripheral sectors like Paints, Healthcare, Retails, etc i.e., investing in companies that are into consumer-centric businesses that grow with consumers and businesses that are into financing this retail consumption. There are a few peripherals stocks too that do not fit completely into the consumption theme, but their inclusion is driven by the strong fundamentals of the company and the company’s effort in making their brand and product visible to retail investors. The idea is to utilize quantitative and qualitative factors observed based on our extensive research for suggesting a SIP model portfolio that makes sense for individual investors.
Who should refer to this Portfolio?
This SIP portfolio is appropriate for disciplined investors who are looking for periodic investments in direct stocks and have moderate to high-risk tolerance with a time horizon longer than five years.
A systematic Investment Plan or more popularly known as SIP, as we all know is to invest a pre-determined amount at a regular interval. SIP is a synonym of disciplined investing wherein an investor stops worrying about finding the “right time to enter the market” and benefits from the power of compounding and average costing. The idea is to use this proven investment philosophy of SIPs for Model Portfolio users that can help stock investors in following the SIP approach utilized popularly for Mutual Funds. The weighting scheme in this model portfolio uses fundamental weights obtained by analyzing ratios used in fundamental analysis.
The SIP portfolio is meant for moderately aggressive investors i.e. investors who are willing to accept periods of moderate to high market volatility in exchange for the possibility of receiving returns that outpace inflation by a significant margin. It is important to have a long-time horizon for moderately aggressive investors investing in direct stocks because if there is a severe downturn in the market, an investor will need plenty of time to make up for the decline in value.
The expected average rate of return from a SIP portfolio is 11-14% over time. In its best year, it might gain 15-20% and in its worst year, it could decline by 20-30%.
These are typical investor profiles who can refer to this portfolio –
1. A low-risk taker 20 – 30-Year-old investor with limited liabilities and above-average savings rate
2. A medium risk taker 35 – 50-year-old investor with dependents and high savings rate and a fair allocation already done to mutual funds for meeting their retirement goals.
3. A high-risk taker above 50-year-old investor with no liabilities and a good retirement corpus in place
Typically, to begin investing, we recommend starting with the mutual fund route, wherein you rely on the professional expertise of fund managers for making stock choices for you. After the initial learning curve, we suggest following it up with the combined approach of Mutual Funds and some percentage of direct stock exposure.
: Minimum 5 yearsRebalancing
: QuarterlyImportant Dates:Inception Date
- February 11th, 2020Launch Date
- February 22nd, 2020Market Cap Category
- Multi-CapLast Quarterly Rebalancing
– August 26th, 2023Next Quarterly Rebalancing
– 25th November, 2023SIP Model Portfolio's performance against Benchmark
10 - 15 stocks portfolio
Stock portfolio - Minimum exposure of 5% and a maximum of 15% to avoid concentration risk.
Minimum investable amount per month between INR 30000 to INR 35000
Disclaimer: The information on this site is provided for reference purposes only and should not be misconstrued as investment advice. Under no circumstances does this information represent a recommendation to buy or sell stocks. All these portfolios are created based on our expert’s experience in the market. These Model portfolios are prepared by SEBI Registered RIA.