My Investment Journey: A Beginner's Guide to Building a Successful Stock Portfolio
Hi there! I’m a beginner when it comes to investing, and I’ve just started my journey in the stock market. This is a snapshot of my portfolio as of today, and I hope it can offer some valuable insights for beginners like myself.
Understanding My Portfolio
My portfolio is based on my confidence in the underlying businesses and their fundamentals. While I can’t reveal the exact purchase and current values for security reasons, I can share that I’m a long-term investor. I started investing when the market was at a peak in 2021, despite knowing it could be risky. But looking back, I don’t think the timing of my entry is as critical as the long-term strategy.
Highlights from My Portfolio
Among my investments, I have been particularly impressed by Hindustan Unilever. It has performed well, and I’m pleased with the returns it has generated. Recently, I’ve added a few more top picks to my portfolio, such as RVNL (Hindustan Retail Ltd.) and IRFC (IDBI Retail Finance Ltd.). These have shown me consistent growth, contributing to my overall portfolio’s success.
From Direct Stocks to Mutual Funds
While I initially invested in direct stocks, I found it quite time-consuming and challenging to keep up with the market dynamics. As a busy professional, I decided to invest in mutual funds instead, where a fund manager would take care of the research and management.
Why Mutual Funds?
By investing through mutual funds, I’ve eliminated the need to monitor the market every day. Instead, I focus on making monthly Systematic Investment Plans (SIPs) in various funds. I started with 10,000 rupees every month in December 2021, gradually increasing it to 25,000 rupees per month.
The Power of Monthly Investments
Over the past two years and two months, I have accumulated a total of 4.61 lakh rupees (Rs 4.61 lakh) in my mutual fund investments. This has grown to 6.02 lakh rupees (Rs 6.02 lakh) as of now. Although there have been fluctuations, my portfolio has maintained a healthy XIRR (Expense Adjusted Internal Rate of Return) of 28.9%. Even during market downturns in 2022 and the first half of 2023, I managed to break even in April 2023 and started making a profit thereafter.
Favourite Mutual Fund: Quant Infrastructure Fund Direct Growth
Among my mutual funds, my personal favorite is the Quant Infrastructure Fund Direct Growth. This fund has delivered impressive returns of 44.4%, with an XIRR of 45.2%. While I understand that thematic funds might be riskier, my reasoning is simple: India is a developing country, and the need for infrastructure is constantly increasing. By investing in an infrastructure-related fund, I believe I am making a smart move that has benefited me the most compared to my other investments.
If you’re a beginner like me, I hope this experience has helped you understand the basics of building a successful portfolio. Long-term investing and mutual funds can be a rewarding way to grow your wealth, even with market fluctuations. Happy investing!