Diversification is the Key for Financial Planning
When I have started my investment journey 8 years back, the only investment I knew was Fixed Deposit and Recurring Deposit. I remember my first investment was Rs 1000 per month in RD. Then slowly when my pay-cheque increased as well as when I started learning about more and more investment, then I came to know different investments.
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Around 5.5 years back I have made a purchase of my first home, though on loan which I consider my first real investment to make a home for life. I took a loan for 10 years but will close it in 6 years, thanks to some salary increases and bonuses.
Around 4 years back, I started investing in Mutual Funds through in the last 4 years my bulk of investment is in Mutual Fund only. Today all my mutual fund investment is aligned with my goal in future. I would not say that I am perfect in managing my Mutual Fund portfolio but it is somewhat decent as of today I got 14 CAGR year to year basis and thanks to some market correction recently.
I remember my first BTC purchase was of Rs 3000 around July 2017 when it was trading below $2000. Though the amount invested is low but I am still holding that BTC and have invested more. Along with that, I have an investment in HIVE where all the amount accumulated is from last 3.5 years on the blockchain.
Similarly, I have started investing in direct equity from this year onwards and will try to invest in quality stocks going forward.
What I am trying to do is to diversify as much as possible so that if any class outperforms or underperforms, my investment plan or the returns will not suffer. We all have a risk-taking ability, someone who is from well to do family can take huge risk whereas some who are conservative takes a very calculative risk. But you have to take a risk to get returns whether low or high.
I belong to a Moderate risk-taking category where most of my investment will not suffer much even if the market crashes today. Just like in March when market corrected around 30% my investment CAGR was around 6%, because of the diversification of Gold, Crypto, FD, Debt Mutual Fund and Equity Mutual Fund.
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