Why my family portfolio has 220 stocks?
Why my family portfolio has 220 stocks?
There are 4757 different instruments that have traded in last 1 year in NSE, out of which there are 2245 equity stocks. I track all these instruments (Equity Stocks, Government Securities, Gold Bonds and Treasury Bills) on day-to-day basis as part of the Smart Money Tracker to identify where the smart money is moving?
While I was working in corporate life, there used to be performance appraisal exercise that used to identify top 10% and next 20% performers. This thought inspired me to follow the same practice in my stock selection for the portfolio using Smart Money Tracker.
I identified top 10% stocks of total 2245 stocks for inclusion in my portfolio which comes to approx. 220 stocks. This not only helps me diversify my portfolio across difference Industry sectors but also across large caps, midcaps and small caps. The additional filtration that I have introduced is, I exclude IPOs that have come within last 1 year and if a stock had any past corporate governance issue in past than I skip those stocks and pick next in the rank. I have observed at least 10% of the stocks that qualify in the ranking had some corporate governance issues in past. These are wolfs in the sheep clothing If on any day, if any stock falls in the ranking based on revised data, I exit that stock and get into the new stock that has replaced the earlier stock in top rankings.
There are 4757 different instruments that have traded in last 1 year in NSE, out of which there are 2245 equity stocks. I track all these instruments (Equity Stocks, Government Securities, Gold Bonds and Treasury Bills) on day-to-day basis as part of the Smart Money Tracker to identify where the smart money is moving?
While I was working in corporate life, there used to be performance appraisal exercise that used to identify top 10% and next 20% performers. This thought inspired me to follow the same practice in my stock selection for the portfolio using Smart Money Tracker.
I identified top 10% stocks of total 2245 stocks for inclusion in my portfolio which comes to approx. 220 stocks. This not only helps me diversify my portfolio across difference Industry sectors but also across large caps, midcaps and small caps. The additional filtration that I have introduced is, I exclude IPOs that have come within last 1 year and if a stock had any past corporate governance issue in past than I skip those stocks and pick next in the rank. I have observed at least 10% of the stocks that qualify in the ranking had some corporate governance issues in past. These are wolfs in the sheep clothing If on any day, if any stock falls in the ranking based on revised data, I exit that stock and get into the new stock that has replaced the earlier stock in top rankings.
Does it mean there will not be losses? There will be mark to market losses based on the market movements but over a period, I am hopeful these stocks will be multi baggers of the future. I also hedge my portfolio with long term put options of Nifty index for any unforeseen events.
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