Thread by @IamMisterBond

My interview with @MubinaKapasi on the Money Show on @ETNOWlive : what is #AssetAllocation and how does #DAAF fit into AA:



Currently it makes sense to do SIP/STP into DAAF and then switch to Equity on corrections

Don't worry it is my interview only😀😉

At this juncture if you have FOMO, you may regret in future. As Harry Markowitz said in his Thesis on Risk-Reward Tradeoff:

VISUALISED MY GRIEF WHEN MARKETS WENT DOWN AND I WAS 100% IN IT OR WHEN MARKETS WENT UP, I WAS'T IN IT. INTENTION SHOULD BE TO MINIMISE FUTURE REGRET

Our Value STP follows 1X, 3X, 100X formula:

Lumpsum in Liquid/Equity Saving and switch into:

1X - in DAAF in Red Zone (current)
3X - in Equity in Yellow Zone
100X - Equity in Green Zone

Returns in DAAF vs NIFTY:
From when markets went in Red zone:
01-07-17 to 03-08-21:
Pro Cycl DAAF: 12.92%
Counter Cycl DAAF: 10.74%
NIFTY 50: 13.74%

When markets once again went in Red:
01-07-20 to 03-08-21
Pro Cycl DAAF: 35.41%
Counter Cycl: 29.53%
NIFTY 50: 49.00%

Above is only comparing #DAAF with NIFTY 50 (though DAAF on an average would be 50:50 Debt and Equity).

Results are even better when you compare NIFTY 50 with Smart Solutions of MisterBond where we would have switched into Equity from DAAF in Green Zone and vice versa

As can be seen, without taking any extra risk, smoother journey, less volatility, better risk- reward trade off, with almost 60-70% in cash at this juncture, investor is better placed to be cautious and be in conservative asset class.

Strategy you adopt is entirely your choice

Investors never expected these kind of returns during #pandemiclife . Treat this as bonus and be satisfied.

Only GREED takes us down.

We forget teachings of #WarrenBuffett during Bull markets:

Be #Fearful when others are #Greedy and Greedy when others are Fearful.