Take the right portion

When we go to an ice cream parlour, we have the opportunity to try out the different flavours on display to help decide which flavour you would like to eat.

While that is great, have you noticed the size of the spoons that they give you to try out the flavours- small, really small. Even if one tried all of the different flavours ( never tried something like that - am sure the server will be very cross) i dont think you will have a nice fruitful filling ice cream. You need to order the one or two scoop ice cream to clear out the ice cream craving and have a full stomach

Whats this got to do with finance? I am sure you are thinking whats the heck is rajneesh blabbering about ice creams! The point i am trying to make is deciding your portion ie the size of your investment.

Think about trying out the different ice creams as an analogy for deciding on your investment plan .. defining your asset allocation and your risk quotient.

Deciding on the final ice cream.. thats like ensuring you have the right portion size , the right investment allocation % to ensure you get the bang for the buck.

I hear a lot of people trying to invest their 5000 or 2000Rs a month sip into five different funds. This causes too much diversification.

If we choose too many funds , when the right funds have been chosen, then the increase or decrease doesnt give the right fillip to the portfolio... it doesnt add enough value.

Once one has decided.. make the investment and the focus count. Choose two to three  funds tops for a goal... no more. It doesnt matter if you are investing 2000 Rs a month or 50000 Rs a month. The concept remains the same.

Make the portion count... it helps give the right punch to your portfolio.. ensure these are eaxh above the 10% mark. Having something at 5% is just not good enough.

Focus is the key word to portion allocation.

Now thats simplefinancialsense