Whalesbook
Financial experts are urging investors to shift strategy, moving from simply accumulating assets to building resilient portfolios with clear goals. The advice favors a simple multi-asset structure instead of complex, overlapping products. This disciplined approach aims to match investments to long-term goals, with each part serving a specific function.
Core Portfolio Framework
Experts consistently recommend a core framework built around equities for growth, debt for stability and income, and gold as a hedge. Karan Rijhsinghani, Head of Product & Advisory at Atom Privé Financial Services, suggests thinking in 'allocation buckets' rather than specific products. He explains that equity is the main driver for growth, debt provides stability and liquidity, and gold acts as a stabilizer. Adding global equities is also advised to lessen risk from focusing too much on domestic markets.
Navigating New-Age Assets
As interest grows in assets like REITs, InvITs, global equities, and digital assets, experts advise against allocations based purely on trends. They recommend an approach based on the asset's role. Rajesh Singla, CEO & Fund Manager at Alpha AMC, suggests REITs and InvITs for generating income and global equities for diversification and currency exposure. However, he discourages aggressive investment in volatile digital assets due to uncertainty about regulations. Ishkaran Chhabra of Centricity WealthTech stresses that new asset classes should add to, not complicate, core portfolios.
The Pitfalls of Over-Diversification
A key concern experts raise is over-diversification, which often leads to duplicated investments and weaker returns. Hitesh Punjabi, Assistant Professor – Finance at K J Somaiya Institute of Management, suggests limiting portfolios to 5-7 asset classes. He recommends a core-satellite strategy: most capital stays stable, with a smaller part in higher-risk ventures. Singla points out that too many products mean index-like returns but higher costs, without better results.
Reimagining Safe Havens: Gold and Debt
Traditional safe-haven assets are being rethought. Gold is increasingly seen as a long-term stabilizer, not just a short-term hedge, with experts recommending a moderate, long-term allocation. Fixed income, or debt, is regaining importance, offering stability and income amid changing interest rates. Phanisekhar Ponangi, Co-Founder & CIO at MavenArk, notes a preference for strategies focused on credit quality over long-duration bonds currently. He states that debt should be a key part of a portfolio, not just a safety net.