How to build a portfolio- If you want to earn money from investment then it is very important for you to have a right portfolio. Today we will learn how to build a good portfolio in the right way so that you can make good profits in the long run.
How to build a portfolio
It is not advisable to invest in only one place to build a good portfolio. You should invest in different modes of investment. So that your portfolio remains stable. And no matter how much you fall in the long run, you shouldn’t be hurt. Only AC would know about the 3 modes of investment so that one can build the right portfolio.
Stock market portfolio
Mutual fund portfolio
How to build your portfolio in the stock market
It is very important to build a good portfolio in the stock market. Because here you get good returns as well as high risk. It is important to choose the right portfolio to reduce the risk.
How many stocks should be there: – How many shares should be invested in the stock market, it depends on your risk. Whenever you invest in one stock repeatedly, if that stock gives good returns then it is not good then there can be big loss also. Therefore it is very important to have at least more than 5 stocks in your portfolio. And there should not be more than 30 stocks. Being above this, you will find it difficult to monitor the stock.
Investing in different sectors:- Different sectors keep performing well over time. If you invest all your money in the stocks of one sector, you may also suffer losses in the long run. That’s why you should invest in maximum sector stocks. But it is not that you should invest in that sector about which you do not know anything. Whatever sector you like, which is performing well in future, you should invest in that sector.
How much to invest in any stock: – Before investing in any stock, you should keep in mind that your investment in that share should not exceed 10% of the total money. No matter how much you like that stock, you do not have to invest much in one stock at all. Anything can happen in the stock market at any time. So you must pay attention to this.
Distribution of money: – It is very important for you to distribute money in the stock market in the right way. Your money should be 40-50% in large cap stocks. This will make your portfolio stable and secure. 20-30% money should go to your mid cap stocks. And for low risk returns, 10-20 percent money should be invested in small cap stocks. This will make your portfolio better and stronger.
Monitor and Review:- Whatever stocks you have in your portfolio. It has to be constantly monitored and reviewed. You should look at the company’s results to see how its growth prospects are performing. If you feel that a stock is not doing according to you then you should keep changing it from time to time. This will continue to improve your stock market portfolio. And in the coming days you will get good earnings.
How to Build a Portfolio in Mutual Funds
Along with the stock market, some part of your money should also be invested in mutual funds. This minimizes the risk in your portfolio. Although mutual fund money is also invested more in the stock market itself, but it remains invested in many stocks. And the fund manager manages that money. It maintains your risk balance. That’s why you should invest in the stock market as well as mutual funds.
How Many Mutual Funds Should One Have:- There is no need to take a lot of funds to build the right mutual fund portfolio. If you invest in more mutual funds, you are investing in one type of fund. You will not be able to earn much returns from this. You should invest in only 3 to 5 mutual funds.
Invest in different funds:- It is better to invest in different funds like large cap, mid cap, small cap according to your risk and if you need to build a good portfolio in tax saver funds. If you want to keep the portfolio simple, it is better to go for multi cap funds. In a multicap, the shares of all the funds are invested together.
Is gold investment necessary for the right portfolio?
Investing in gold is considered the safest. Apart from mutual funds and stock market, it is very important to invest a small part of your money in gold also. This makes your risk negligible. It is not at all like buying physical gold, you should buy cable e-gold only. Investing in gold is the right way to build a good safe portfolio.
Before earning money through investment you should come first to save that money. Then you should invest. If you follow these things while making a portfolio, then you are going to earn good money through investments in the coming days.