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Hi friends, want to have discussion on
How do you construct your portfolio?
Would like to know your thoughts and process. This will help us refine our process.
I will start with mine to get the flow going.
As per MCap
Large (say > 30K cr) : 30 to 50%
Mid (30> Mid > 5K cr) : 30 - 50%
Small (5K> Small > 1K cr) : 20 - 30%
Micro (<1K cr) : upto 5%
No of companies: 25-30
Some criteria
-Less Leveraged (preferred D/E < 0.3)
- No Commodities, Infra, PSU, etc
- Prefer services over manufacturing
- No Stock > 10% (made exception 2 times CSB (however now at 10) and ITC (Will correct it soon)
- No Group > 15%
- No Sector > 25-30%
- Historic all returns ratios consistently> 15%
- Promoter held stock < 5-6% (lesson learnt from Hero Moto)
- In case of management transition or co revival, Don't go all in instantly even if valuations are good, go slow (lesson learnt from CSB)
- Limit total exposure in unrelated (where I don't understand much e:g chemical) to 10-15%
1/2
How do you construct your portfolio?
Would like to know your thoughts and process. This will help us refine our process.
I will start with mine to get the flow going.
As per MCap
Large (say > 30K cr) : 30 to 50%
Mid (30> Mid > 5K cr) : 30 - 50%
Small (5K> Small > 1K cr) : 20 - 30%
Micro (<1K cr) : upto 5%
No of companies: 25-30
Some criteria
-Less Leveraged (preferred D/E < 0.3)
- No Commodities, Infra, PSU, etc
- Prefer services over manufacturing
- No Stock > 10% (made exception 2 times CSB (however now at 10) and ITC (Will correct it soon)
- No Group > 15%
- No Sector > 25-30%
- Historic all returns ratios consistently> 15%
- Promoter held stock < 5-6% (lesson learnt from Hero Moto)
- In case of management transition or co revival, Don't go all in instantly even if valuations are good, go slow (lesson learnt from CSB)
- Limit total exposure in unrelated (where I don't understand much e:g chemical) to 10-15%
1/2