Should you copy the portfolio of ACE investors? 🤔
A 🧵 on limitations of copycat investing 👇
#stocktobuy #investments
A 🧵 on limitations of copycat investing 👇
#stocktobuy #investments
Rakesh Jhunjhunwala’s portfolio has delivered an absolute return of ~96 % between March 2019 to November 2021, compared to Nifty’s ~50% returns during the same period.
Source : moneycontrol
Can you earn similar returns by copying his entire portfolio?👇
Source : moneycontrol
Can you earn similar returns by copying his entire portfolio?👇
But how can you find their portfolio?
As per SEBI:
- Listed companies must declare names of investors holding > 1% of their market cap every quarter
- Big investors have to disclose their trades if value of their trade > 0.5% of total market cap
As per SEBI:
- Listed companies must declare names of investors holding > 1% of their market cap every quarter
- Big investors have to disclose their trades if value of their trade > 0.5% of total market cap
You can track this information through the exchange websites or stock research websites like Ticker and purchase the same stocks.
But wait, there are some pitfalls as well!
But wait, there are some pitfalls as well!
1. You cannot find the exact portfolio of big investors!
The disclosure requirement is only mandatory, if the investor holds > 1% of the company’s share.
So, if a popular investor like Rakesh Jhunjhunwala is holding less than 1% of a company , you cannot find the name easily.
The disclosure requirement is only mandatory, if the investor holds > 1% of the company’s share.
So, if a popular investor like Rakesh Jhunjhunwala is holding less than 1% of a company , you cannot find the name easily.
2. Timing :
The trades are disclosed in quarterly results.
So, it is possible that by the time you get to know about the trade, the share price has already increased significantly.
And buying an overvalued share has its own demerits!
The trades are disclosed in quarterly results.
So, it is possible that by the time you get to know about the trade, the share price has already increased significantly.
And buying an overvalued share has its own demerits!
3. Ace investors can also commit mistakes!
There are many incidents where famous investors like Buffett and Jhunjhunwala have admitted their mistakes where they lost heavy amounts.
Blindly following their portfolio may cause massive losses as well
There are many incidents where famous investors like Buffett and Jhunjhunwala have admitted their mistakes where they lost heavy amounts.
Blindly following their portfolio may cause massive losses as well
What should you do?
One must study the ideas & strategy of stock gurus but should not blindly copy their portfolio without his own due diligence.
Use this information as a reference point or to enhance the confidence level while making an investment decision.
One must study the ideas & strategy of stock gurus but should not blindly copy their portfolio without his own due diligence.
Use this information as a reference point or to enhance the confidence level while making an investment decision.
Your risk appetite & financial goals are non-identical to other investors. So before taking an investing decision, identify your risk taking ability!
How?
- Signup to Recipe.finology.in
- Visit Dashboard & complete your Spending Habit
- Take the Financial Appetite test
How?
- Signup to Recipe.finology.in
- Visit Dashboard & complete your Spending Habit
- Take the Financial Appetite test
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