What is money management

A

amarnath

Guest
#51
#51
Laksh said:
Enron, worldcom are distant to us. Why not talk of himachal, pentasoft,dsqbiotech etc after 2001 and acc after 1992. These are some of the disasters that I can remember off hand.

Laksh
Click to expand...
I so far traded only on overseas mkt and MCX and never on Indian stocks so far :)
 
Y

yoogi

Member
#52
#52
For long term investors, it is a diffrent kind of money management.

a) The amount of money you will need in short term, and long term needs to be seperated.

If you need money 40 Lack for your kids education in next 5 years. this part of your portfolio should reflect a balanced fund, like 40% debt + 60% capital and should be reduced to 10% equities and 90% debt over 4 years. Here you may not earn much but make sure that you dont loose the money that is needed in next 5 years.

b) Retirement corpus: This should again be based on the time you got for retirement. Up to last 15 years, you could keep all equity, and slowly convert into debt + equity to about 50-50 basis when you retire.

c) Asset spread + diversification:

Should invest in all forms of investment, to avoid any sudden loss in value. Capital market, precious metals, debt, real estate... Work out the ratio according to your risk appetite and market conditions. Preiodic review of asset spread and diversification is good. WIth better diversification, you can avoid problems like enron.
 
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