Money Distribution With Risk Appetite

babidash@hotmail.com · #1 4th July 2008, 06:21 AM

Hi All,

Any suggestion on distribution of money in percentage While investing in equity, mutual funds ?
what should be one's money distribution percentage with below types of appetite?

Types of appetite
Beginner with HIGH risk
Begineer with Moderate risk
Begineer with Low Risk

Thanks Again
bABIDASH...

uasish · #2 5th July 2008, 08:43 AM

Quote:

Originally Posted by babidash@************

Hi All,

Any suggestion on distribution of money in percentage While investing in equity, mutual funds ?
what should be one's money distribution percentage with below types of appetite?

Types of appetite
Beginner with HIGH risk
Begineer with Moderate risk
Begineer with Low Risk

Thanks Again
bABIDASH...

It is not only Risk appetiate but like a Pyramid,at the base is age,more younger ,more towards base ,more risk (more of Equity),higher the age,higher from the base ,less risk (less of equity ) ,as the age increases more towards Apex of the Pyramid,where no equity only secured Govt papers.
This is a normal approach taken by Investment Advisors.
Position your self in that scale,as per your family commitments present & coming in future,say your child is now 9 yrs,then his/her future education,your flat's EMI etc etc.These priorities determine allocation of Fund
& the time frame.

masterjee · #3 5th July 2008, 01:14 PM

Quote:

Originally Posted by babidash@************

Hi All,

Any suggestion on distribution of money in percentage While investing in equity, mutual funds ?
what should be one's money distribution percentage with below types of appetite?

Types of appetite
Beginner with HIGH risk
Begineer with Moderate risk
Begineer with Low Risk

Thanks Again
bABIDASH...

Equity and equity oriented mutual funds are identical. You are perhaps referring to ration equity:nonequity say interest bearing securities. Thumbrule is 100-your age is the ratio in equity. This assumes lower risk (equity) as you grow older. As Kalam would say - repeat after me - equity is risk capital, right?.....
regards
m

babidash@hotmail.com · #4 8th July 2008, 10:18 PM

Thanks a lot...

Ashish, masterjee for your kind feedback...

beginner_av · #5 9th July 2008, 07:17 PM

Well unfortunately it is not that simple, and there are NO rules of thumbs except for crap doled out by financial advisors with vested interest. So read, gain knowledge, and make informed decision.

PS: If there are a number of people requiring financial education (not which fund to buy), do let me know, I can start a separate section/thread/post/blog/group to the best of my abilities.

masterjee · #6 13th July 2008, 10:53 AM

Quote:

Originally Posted by beginner_av

Well unfortunately it is not that simple, and there are NO rules of thumbs except for crap doled out by financial advisors with vested interest. So read, gain knowledge, and make informed decision.

PS: If there are a number of people requiring financial education (not which fund to buy), do let me know, I can start a separate section/thread/post/blog/group to the best of my abilities.

Everyone should read the Motley fool guide to Investments (available free on the internet). It is really that simple.

m

beginner_av · #7 13th July 2008, 12:51 PM

there is a fly a plane for dummies, and there are trained pilots. it is up to the investor to decide whether to use amateurish techniques or professional ones.

sanx · #8 13th July 2008, 01:07 PM

Quote:

Originally Posted by beginner_av

Well unfortunately it is not that simple, and there are NO rules of thumbs except for crap doled out by financial advisors with vested interest. So read, gain knowledge, and make informed decision.

PS: If there are a number of people requiring financial education (not which fund to buy), do let me know, I can start a separate section/thread/post/blog/group to the best of my abilities.

Sure go ahead and start one . Would be looking forward .

masterjee · #9 15th July 2008, 08:21 PM

There is also "Investment for Dummies" - one could read that before trying to get airborne.
m

moneygurukul · #10 16th July 2008, 04:45 PM

Quote:

Originally Posted by babidash@*******.com

Hi All,

Any suggestion on distribution of money in percentage While investing in equity, mutual funds ?
what should be one's money distribution percentage with below types of appetite?

Types of appetite
Beginner with HIGH risk
Begineer with Moderate risk
Begineer with Low Risk

Thanks Again
bABIDASH...

How is Risk Appetite Defined? Any criteria for defining High/Low/Moderate Risk Appetite?

My own experience is that 99% of the people coming to equity markets (Especially the investor class) have no idea what risk is.(For example, 99.99%will say that a Long-term investment is less risky than a short-term trading adventure.).