Soumya Rajan, Founder, waterfield consultant, is part of a very envious minority – who have got allotments for IPOs of dream shares like HDFC Bank, ICICI Bank and TCS. Still, Rajan, who was a banker before joining Wealth Management, still remembers the days when she had to fill up a physical application form for an IPO. The amount invested in these stocks was small, but they are a beautiful reminder of the power of compounding for him.
However, Rajan has seen his share in bad investments as well. He bought LIC policies in his early working years, and like many other insurance policy holders – forfeited them when he decided to stop paying premiums. In his early days of equity investing, he also bought penny stocks on the advice of friends, and they have remained so over the years. The journey of his personal portfolio is similar to what most of us have seen – few hits, few wrong moves but no undue aggression or risk taking. Much of this is likely to be reflected in his discussions with customers.
Today, Rajan heads one of India’s largest wealth management firms – one that is on the verge of rapid expansion. “The pandemic was good for us,” she explains. “People had more money to invest and our wealth grew.”
waterfield consultantHis firm is named after a street in Bandra, where Rajan began his career in finance. It counts 200 clients and $4.3 billion in assets, compared to $1.6 billion nearly five years ago. Its headcount has increased from 30 to 150 in just 2 years.
Rajan has a classic balanced portfolio: 50% in equities, 25% in debt, 5% in gold and 20% in alternative funds. Most of her equity portfolio is in large cap stocks (55% of the equity portfolio) and she wants to increase it further.
“Quality names have underperformed recently, so there is an opportunity to accumulate quality large-cap equities. We have seen constant FII sell-offs in quality blue-chip names over the past few months. When the tide starts to turn, they will be the first to rebound,” he told Mint.
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25% of its equity portfolio is in passive strategies or strategies that have some passive elements.
On the debt side, Rajan sticks with target maturity funds and roll-down strategies. These types of plans, if matched to your goals or time frame, can give highly predictable returns. About 10% of his portfolio is in international funds and stocks.
“International funds and stocks offer geographic diversification and with a strong dollar index, returns are expected to improve further over the next 2-3 years,” he added.
Rajan dipped his toes in gold as an investment in March 2020 and has continued to see it as a hedge against inflation since then.
“The alternative exposure is mainly to PE and VC funds, with exposure to Fund of Funds from Waterfield and AIFs set up by women,” Rajan said.
Despite his relative conservatism, there are parts to Rajan’s portfolio and investing style that come from being a wealth manager and a large business owner. Those who want to emulate it should keep this in mind.
Optional properties typically have a minimum ticket size of approx. Huh 1 crore and are available only to high net worth investors. It is his journey that is more instructive – with both successes and missteps like penny stock and LIC policies on the way. His current portfolio can be summarized as follows: ‘Diversified and skewed towards blue chip companies in equity, low cost target maturity funds in debt.’