Invest in a portfolio that suits your needs

Recipe for the perfect dish

Birla Sun Life Frontline Equity, DSPBR Opportunities, UTI Equity or Tata Pure Equity and a few more are all roughly equivalent.

There is a portfolio to meet every investor’s unique requirements

If it were up to me, I’d rather that none of you ever need to read this month’s cover story. I know it sounds like a strange thing for a magazine’s editor to say, but the reason for this goes very deeply into the Value Research philosophy. We believe in the old saying “Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime”.

The headline ‘Portfolios to Go’ is a phrase about food. ‘To go’ means (especially in the world of Americanised fast food), something pre-cooked and ready to eat that you can just pick up and eat on the move. However, Value Research doesn’t want to provide readers with fast food, or even pre-cooked food. We aren’t a restaurant of investment ideas. Instead, we would like to show you how to cook and then give you the ingredients.

Unlike a lot of other investment magazines, books and websites that are available, our focus has always been educational. Our goal is that our readers should learn the principals behind fund selection instead of depending on us telling them which fund to invest in. Ideally, our readers should depend on us for reliable and accurate data, ratings, fund news, fund manager interviews and other such things that are inputs for constructing their own investment portfolios.

Keeping this in mind, the headline notwithstanding, our ‘Portfolios to Go’ are not really ready-to-eat fast food. The most important part of our cover story is not the actual portfolios we suggest, but the thought behind the design of the portfolios and the reasoning behind the choice of funds. Regardless of what fund marketers would have you believe, there’s no such thing as a unique, irreplaceable fund. In all the categories of funds that we have, there are more than one (in most cases, a whole lot more than one).

If you are looking for a large- & mid-cap fund to be the core holding of your portfolio, then Birla Sun Life Frontline Equity, DSPBR Opportunities, UTI Equity or Tata Pure Equity and a few more are all roughly equivalent. On a given day, one might look better than the others, but that’s mostly in hindsight. What is more important is that you as an investor understand the role that such a fund plays in the portfolio and the basis on which we say some funds are better than others. If you understand that, the job is done. On the other hand if you just copy any set of recommendations and execute them precisely without thinking about why you are doing what you are doing; you still have a long way to go.

In fact, there’s a stage even before you get down to cooking and that is to choose which dish to cook. Many investors will have the right funds in their portfolio, but may go wrong in choosing what kind of portfolio they should invest in. Readers will find it just as useful, if not more, to carefully read and evaluate the article where we describe the logic for each portfolio and the kind of investor profile who should need it.

A good cook may need a recipe, but he chooses the one that will produce the dish he’ll find tasty, and he knows what each ingredient does and adjusts each to his or her own taste. As another year approaches an end, it is a good time for you to re-look at your investments.

-- Dhirendra Kumar