How To Diversify My Finance Portfolio In India?
Portfolio diversification is an investment strategy that collaborate different investments in a single portfolio. Since portfolio diversification is an art, therefore it aims at maximisation of return and decrement in risks.
Various factors that effect the portfolio diversification are:
- Purpose of diversification
- Age of the investor
- Ability to take and bear risk
- Time period and future goals
Various methods of portfolio diversification in India:
For an Indian Resident, investment portfolio can be diversified in lieu of following schemes and opportunities available to the investor:
- Large Cap schemes (hereinafter called just as Funds)
- Mid Cap Funds
- Small Cap Funds
- International Funds
- Mutual funds
- Long Term Govt Securities Funds
- Gold Funds
- A diversified set of stocks across market caps that have potential to grow well in the long term in a sustainable manner (a professional may be consulted to identify such potential long term multibaggers)
- A positional trading portfolio of stocks with short term appreciation potential
- An intraday equity trading investment using a highly sound and reliable strategy and platform (it’s better not to try this yourself but consult an expert)
- Direct equity
- Equity mutual funds
- Debt mutual funds
- National Pension System (NPS)
- Public Provident Fund (PPF)
- Bank fixed deposit (FD)
- Senior Citizens’ Saving Scheme (SCSS)
- RBI Taxable Bonds.
- SIP mutual funds
- Institutional investment
Though there are number of options available with the investor, yet he should not be greedy, instead wiser decisions should be made after consulting the market experts.