PrudentGain, our comprehensive wealth creation service has three clearly defined stages: Plan, Invest and Harvest. At Plan stage, we devise an investment plan for creating long term wealth for a comfortable and prosperous retirement for our clients. At Invest stage we put this plan into action to achieve the target retirement corpus and lastly at Harvest stage, we deploy our yield generating strategies to earn the desired retirement income from the accumulated corpus.
Out of these three stages, Invest is the stage at which we execute the planned investments into action and therefore the most critical stage in wealth creation journey of our clients. We will elaborate here a model portfolio which we will construct for our clients and which will be continuously monitored and evaluated for risk and return.
We divide total portfolio allocation into five sectors/ market segments. These are: Nifty Index, Banking & Financial Services (BFSI), Global equities, Mid & Small cap segment and lastly companies with exceptional growth prospects and competitive advantages in their industry segments.
- Nifty Index: The purpose of allocating a fifth of the capital here is to generate market matching returns passively at very low costs and with moderate risk. Also for clients with low to medium risk tolerance and risk appetite, allocation to this segment will be higher reflecting lower risk profile of the investments.
- BFSI: BFSI is a segment of the Indian economy with enormous long term growth prospects. When we speak of BFSI sector we are not talking about banking alone but also other services such as mutual fund companies, depositories, brokerages, rating agencies, insurance companies, registrars etc. The penetration of some of these services such as mutual funds and insurance is still very low in India, thus providing a huge market opportunity as well as a wealth creation opportunity for long term investors.
- Global Equities: We can now invest in global equity indices such as S&P 500 or NASDAQ thanks to availability of ETFs on these indices which can be bought through demat accounts or through mutual funds. Benefits of investing in global equities include geographical diversification, exposure to developed word markets and also opportunity to invest in high value tech companies such as those in NASDAQ index.
- Mid and Small cap segment: Investing in mid and small cap companies offers immense wealth creation opportunities through access to promising large companies of tomorrow. This is also the segment of the market most likely to generate above normal returns but also be more volatile. Thus exposure to this segment is meant for clients with higher risk tolerance and appetite.
- Investing in well researched companies: Finally we will also allocate client capital select companies shortlisted by us on the basis of long growth prospects, industry leadership, valuation, corporate governance and other financial and non-financial parameters. The number of such companies in the portfolio is likely to be small in order to enable focused and concentrated holdings in these high conviction investment bets. Again given the high risk-return nature of these investments, we will follow this approach for clients with high levels of risk tolerance only.
To know more about our services and also plan your retirement, please get in touch with us. We offer a Virtual HelpDesk for our clients, where you can request a free video consultation with us to answer your financial and investing queries.