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Atul Shinghal, founder and CEO of Scripbox — a digital wealth management platform — said that he is an equity-biased investor but doesn’t venture into direct equity investments. “I strongly believe that we have to trust the professionals. My portfolio reflects the fund recommendations by Scripbox," he added.

Scripbox algorithms construct portfolios, typically, by selecting a mix of large and mid-cap funds with a consistent track record over the long term, with more focus on the recent track record. For the debt portfolio, according to Scripbox, the algorithm selects funds that are consistently performing better than the CCIL Broad TRI Index, an index that tracks the top 20 traded Indian government bonds based on volume and number of trades.

Shinghal shared his portfolio details for the special annual Mint series – Guru Portfolio, which started in 2020, to understand the impact of the pandemic on the personal investment portfolios of leaders in the financial services space.

The series looks at how respondents’ investments have fared, the changes made to their portfolios, and the investment lessons they have for investors.

Asset class views

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Shinghal has about 60% of the portfolio exposure to equity. He believes that equity helps in beating inflation and building wealth in the long term. A 10% of the equity portfolio is invested abroad for diversification. He also considers this international exposure as a hedge against the dollar fluctuation/depreciation for meeting his future financial goal.

“My daughter wants to study abroad, so investments abroad help in dollar hedging," he added.

Though Shinghal has 20% allocation to real estate (in the form of properties), he doesn’t believe in it as an asset class considering the cost of buying and selling the property and its illiquid nature.

He also doesn’t believe in including the home as part of the net worth, saying that it is not an appreciating asset one can utilize either for emergency purposes or to generate returns. But he is positive about the new emerging asset classes which are linked to real estate (eg - REITs).

As regards his angel investments, he said, “As I am an entrepreneur, I support entrepreneurs. So, I have some angel investments."

Takeaway

Shinghal is a firm believer in putting into practice his asset allocation principles.

First, he identified himself as a high-risk-taking investor based on risk profiling. Also, he identified his financial goals such as retirement and his daughter’s education.

Based on the investment horizon available for each goal, the asset allocation of the portfolio has been determined, which is reviewed every year based on the requirements.

For example, he said that he recently moved some investments from equity to a fixed-income portfolio to meet his daughter’s education requirement that comes in the next few years. Since Shinghal has exposure to angel investing, we asked him what his advice would be for someone who also wishes to invest in start-ups.

For that, he said, “If the advisor or financial wealth manager says that a portion of one’s portfolio can be allocated to higher-risk assets, it is fine. But, I believe, it shouldn’t be more than 10%. Before investing, one must make sure that their financial goals such as retirement and child education are secured well."

He also said that individuals will be better off making use of angel investing platforms while investing in start-ups.

He added “as an individual, it is unlikely, in most cases, that the investor will be able to have full understanding of the start-up, the entrepreneur, and what it is doing. So, it is better to find a platform that can do the diligence."

(Note to readers: Through this series, we try to highlight the basic tenets of personal finance such as asset allocation, diversification, and rebalancing. We do not suggest replicating the asset allocation of Shinghal, as personal finance is individual-specific and differs from one person to another.)

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