Investing can appear complicated, but there are smart guidelines that one can follow like having a bunch of rules and approaching investment with a philosophy, said Mr Saurabh Mukherjea, Founder & Chief Investment Officer, Marcellus Investment Managers Pvt Ltd at AIMA’s LeaderSpeak Session.
The purpose of our company, Marcellus Investment Managers is to influence efficient capital allocation in the Indian economy by channeling household savings towards companies with long track records of efficient capital allocation, who in turn deliver superior returns to savers.
My message to investors is to reinvest their earnings automatically, and in turn, those earnings would add to the value of their account and boost the potential to earn even more. As far as compounding goes, it is a powerful investing concept that involves earning returns on both your original investment and on returns you received previously.
I am listing out a few tips that can help you invest smartly to create maximum wealth-
- Diversify your portfolio- Invest across different asset classes (stock bonds, real estate and more). Doing this can help improve overall returns.
- Have a long-term perspective- Investing is not a get-rich-fast scheme. Stay committed to your investment plan, even during market downturns.
- Keep costs low- Look for investments with low expense ratios and consider commission-free trading platforms.
- Regularly review and rebalance- Review your investment portfolio periodically to ensure that it aligns with your goals. Rebalance it to maintain your desired asset allocation.
- Seek professional advice- If you’re uncertain about your investment choices or have complex financial situations, consider consulting a financial advisor.
- Build an emergency fund- Before you start investing, make sure that you have an emergency fund in place to cover unexpected expenses. This can prevent you from having to sell investments prematurely.
- Protect your wealth- Invest in insurance, estate planning, and other measures to protect your wealth from unexpected events or liabilities.
Remember, there are no one-size-fits-all investment strategies, and what works for one person may not work for another, that is why, it is important to tailor your investment approach to your individual circumstances and financial goals.
Besides, creating wealth is a gradual process, and there are no guaranteed shortcuts to becoming wealthy. It requires discipline, patience and a long-term perspective. Additionally, individual circumstances vary, so it’s important to tailor your wealth-building strategy to your unique financial goals and situation.
In conclusion, I would say that active investment could provide you with huge returns, but it completely depends upon your investment timings. I would, however, suggest passive investment, as it is cheaper, less complex, and often produces superior after-tax results over medium to long time horizons than actively managed portfolios. One must however, go by “a bunch of rules” when investing in anything of one’s choice.
Watch the full Session- https://www.youtube.com/watch?v=dPGLpeoO1RI&t=879s