1Source: ET Wealth

Football & Investment

• Investing is a lot like football. Your team (portfolio) comprises players (your investments), positioned in a predetermined team formation (asset mix) based on a certain playing style (risk profile). Here is how you can build a world-class investment team and achieve glory in the investment field. 2

Debt

PPF/NSC

Small cap/ Mid cap/ Thematic

FORMING THE TEAM (ASSET MIX)

• Just like a football manager decides to play offense, defence or something in-between — depending on his team — an investor has to decide on allocation to vari - ous asset classes depending on his risk appetite.

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Attacking formation

• If you attack, you can score more goals. At the same time, you risk conceding more goals, if the opposition counter-attacks. So, while there is a potential for scoring big victories (large gains), there is also a danger of suffering bigger defeats (huge losses).

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Whom does it suit

• This formation is best suited if you are young and have many years to go before retirement. If you don't mind your investment performance swinging wildly, then you can take on more equity exposure.

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WATCHING FROM THE SIDELINES

• A football team manager often makes tactical changes to his team. You too must monitor your investments and tweak them when required. If you feel your goal is already achieved, you should substitute some of your equity players with debt players to protect your gains.

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Balanced formation

• Some teams look for a balance between defence and attack. The focus is on a strong midfield that can be effective on the attack while providing cover when the time comes to defend. Such a team is equally adept at scoring goals (taking advantage of opportunities for gains) while not conceding them (provide stability during downturn).

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Whom does it suit

• People in their middle years looking to build up assets can take this approach. Even young investors who are not com- fortable taking on much risk may go with this formation.

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COMPOSITION OF THE TEAM (INVESTMENTS)

• The team will be composed of strikers hungry to score goals, midfielders to pro- vide some steel and creativity, and defend- ers to repel the opposition attacks. For your portfolio, you will also have to pick the right investments for every position.

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Defensive formation

• In this formation, you are likely to concede few goals (limited losses), but will not be able to score many either (limited gains). So, you may be able to keep a clean sheet, but will face trouble scoring a victory over the opposition (beating inflation, for instance).

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Whom does it suit

• This formation is meant for investors who simply cannot digest risk and are most concerned about protection of capital.

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Disclaimer: This Presentation is for information purposes only and does not represent any financial or other advice. It is not intended as an offer or solicitation for the purchase or sale of any financial instrumental including stocks or MFs. The information contained in this presentation is general in nature. Before making any investment, please consider carefully all risks prior to investing in any security of financial instrument and consult an independent financial advisor with regard to any envisaged investment in stocks.

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