Just like your home And wardrobe, Your Stock Portfolio also needs decluttering. Why trap your capital in such stock where there is future is uncertain?

What is the Central theme of decluttering?

Well, I don’t know about other capital Markets and stock exchanges. But in India, we have some clutter. Like JP associate, Bhushan Steel, Bhushan Steel and Power, Reliance Communication, IDBI Bank, Indian Overseas Bank, PC Jewels, Vakrangee,…

What is a reason to keep your capital trapped in the stock where no future is uncertain, but you can get the deal in the Market?

For doing this, We need to understand that there is a company behind every stock. Stock is not a lottery ticket.

So what to do. I am going to give you some points. Not tips. As it could be challenging to practice the same thing in different Market. Like pharma, one year from today was challenging for Investors, but now it is looking good.

One most important thing I can tell you from my experience is that you Don’t keep more than one Demat account. You don’t need them. It only adds your fee, so Does your hurdle rate to make breakeven.

Decluttering your portfolio and Goal-based investing is not live differently. You can’t think about your goal without decluttering. The moment there is goal-based investing, Decluttering is the most important to do. I saw so many people telling themselves that Warren Buffett never Sold anything. Wrong. If I am not mistaken, he sold IBM. P&G. After dealing with Duracell, there was some portion remaining with him. He sold it. And BTW, why you are comparing yourself with a man managing $100 billion and, in his word, “People pay us to keep their Cash.” You can’t. Your cost of fund and Warren’s Cost of Funds is different.

While you are dealing with your portfolio, the most important thing is thinking about why and in what asset classes you are investing in, like in Telecom in India. Before the entry of Reliance jio, it was good. ARPU is looking good. But the entry of deep Pocket investors changed the Profile of the sector. If you are INVESTED in Real estate, then whether that is right for your goal? Check it. At least twice a year.

If you are holding mutual funds and, by mistake, the fund manager changed, check the track record of the new one. If not correct, think about selling.

In goal-based investing, even a 10% downside from your buying in one year is needed to check about the company. If the company is good, then it is ok.

Study the fundamentals. Technical Charts may help but understand what is Based on it. Even operators can make stock like R-Comm running like mad. But ignoring it is fundamental, making you Vulnerable to a considerable risk.

Pls, check the actual rate of Return vs. the expected rate. If the portfolio is not equal to what is expected, think about realigning your portfolio. Sometimes even Kotak Bank can give a Flat return. So keep an eye on it.

There is no need to index when it comes to goal-based investing. The only thing matter is whether it is making the expected Return.

There are some investments which you can keep. But some are cyclical. Buy at the right time and exit at the right time will give you great success. Banking is one example.
Do you have multiple funds that feature the same investments? It’s time to get rid of that duplication. People with mutual funds should be aware of what each of them covers. Most of them are the same. They are sufficiently diversified. You hardly need to invest way too many mutual funds for diversifying. I believe that six is the correct number for Mutual Funds. If you are sitting in the US, Vanguard, DSP Black Rock, or Fidelity Free funds are the right choices.

Pls, talk about your financial advisor. Don’t put your question on a site like Quora. Paying an advisor will help.

A diversified portfolio may help, but sometimes it pays to keep a small portfolio with Some cash in Hand.

In my view, Payment Banks in India like PayTM, Airtel Payment Bank, Idea Payment Bank, Post payment Bank, and Fino Payment Bank can help you make emergency funds. It is important because the money in them is easily accessible and gives you the option not to liquidate your portfolio for small Needs.

In India, we are living in the era of SIP. Your advisor will tell you not to stop them. I am telling you to block them just one year before your goal. In India, if you redeem your investment before one year, it will charge you one percent of the redemption. In short, keep an eye on the applicable rules.

Most important is the time frame. Yes, Equity is excellent. But why are you sitting huge Equity when your goal is near, and you nearly achieved it. Remember, Equity is for making wealth, and Bonds and Debentures are for storing them. Don’t confuse yourself with your risk profile.