A Mutual Fund Portfolio is the collection of investments made in different Mutual fund schemes. All these investments are in sync with your investment objectives and goals. It offers a comprehensive view of your investments in Mutual funds and allows you to monitor them or analyze and manage them better.
Investing in random mutual funds, maybe the best performers from each category is not a strategic way of creating a portfolio. You can leave that job to us. We Kashly have created a bunch of ready-made portfolios to start with. You can choose the portfolio that fit your investment objective and risk appetite.
Kashly’s Strategy: Core and Satellite Investing
Core and satellite is a common, time-tested portfolio design that’s made up of a core investment (large allocation) and other satellite funds (small allocation) that complement it. Like many best strategies, core and satellite are simple and effective for long-term, buy-and-hold investing.
The objective of this design is to reduce risk through diversification while outperforming a standard benchmark for performance, such as the NIFTY 50 & Sensex. The goal is to achieve above-average returns with below-average risk.
How does it work?
One of the first things new investors learn about is the value of diversification. It’s vital to asset classes, sectors, and markets. It helps to protect you when one investment is going through a down period. One of the simplest ways to achieve it is through mutual and index funds.
The core and satellite strategy aims to help you do so. usually, core portfolios consist of passive funds as well, but Kashly uses well-managed active funds to create our portfolios.
Core Holdings
Normally the core asset makes up the largest portion of the portfolio. But the allocation percentage varies as the risk profile of a customer varies. For a moderate risk taking customer, ~ 60% of his portfolio will be in core holdings only.
Usually core holdings consists of well diversified largecap funds, conservative hybrid funds or debt funds. Core holding will be less volatile comparing to the satellite holdings.
Satellite Holdings
The satellites represent fund categories that will complete the core and satellite structure. These other funds can include mid-cap stocks, small-cap stocks, foreign stocks, fixed income bonds, sectoral funds, gold, and money market funds. These are the funds that will help you obtain higher returns than benchmarks like the NIFTY 50, Sensex. The core and satellite design can help ensure that you’re well diversified among asset types and fund categories.
| Sample portfolio using core and satellite strategy | ||
| Investments | Core/ Satellite | % of Portfolio |
| Largecap Fund | Core | 30% |
| Multi- Asset Fund | Core | 20% |
| Midcap Fund | Core | 15% |
| Smallcap Fund | Satellite | 15% |
| Gold ETF | Satellite | 5% |
| International ETF | Satellite | 15% |
Point to note
The core-satellite approach provides an opportunity to access the best of all worlds. Better-than-average performance, limited volatility, and cost control all come together in a flexible package that can be designed specifically to cater to your needs. If you want to explore more, check out Kashly’s Readymade K-Portfolios which is good for investors with long term investment horizon.
Disclaimer: Kashly doesn’t provide tax or investment services or advice. This information does not take into account the objectives, risk tolerance, or financial circumstances of any one investor. It might not be right for all investors. Investing involves risk, including the loss of principal.
