Posts Tagged ‘fixed deposit’

“The only real battle in life is between hanging on and letting go.”

― Shannon L.

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This is exactly what you need to ask yourself while reviewing your existing set of investments.

Once you have decided your goals, you need to review your existing investments. This will give you a sense on which is the ones that are not doing well so that they can be replaced. It will also help you understand based on your asset allocation and goals that going forward where you need to invest so that your investments are in line with your goals.

You may be having some investments in stocks, Mutual funds, Real estate, fixed deposits, gold, etc. Or there are even chances that your investments may be concentrated in some of the assets.

Here’s what you can do

Stocks and Mutual Funds

If you have stocks in your portfolio and you understand bit of markets then you can decide based on what is happening in the economy, what are the sectors that are outperforming or under performing at that point in time, the demand environment, the credit environment, etc.  and accordingly decide whether you want to keep it or sell it.

A better way to do this would be by investing through Mutual Funds. There you will benefit from the expertise of the fund manager. It will also save you from micromanaging at security level. With the introduction of direct plans, you can now invest by paying a lesser expense ratio compared to a regular plan. Mutual funds can be used to take exposure in equity, both domestic and international, debt, mix of debt and equity through balanced or Monthly income plans, commodities and index.

Fixed Deposits

If you have Bank or company Fixed Deposits or Post office investments then you need to see the rate that you are getting on your FD and what is the interest rate expectation going forward. If your FD is due to mature shortly and there is expectation that interest rates are going to fall, similar to the current scenario, then either you lock in now at the existing higher rates or when your FD matures you can reinvest it in some other investment instrument depending on your goals. In FDs also there are Bank FDs and Company FDs. Company FDs offer comparatively higher returns but remember to focus on quality

Real estate

It’s not a great idea to lock in 70 to 80% of your wealth in real estate. Real estate has its own cycles of boom and depression. It’s difficult to sell these at the price of your choice. They are certainly not assets which can be sold immediately due to their illiquid nature. Doing so will need you to settle at lower prices. In real estate also there are some pieces which appreciate faster based on demand environment, location, etc. while some of them do not see much appreciation again due to unfavorable location, lack of demand, etc. Therefore, try to sell that piece of your property which is not yielding good returns and channelize your investments in some liquid and appreciating investments.


Indians have emotional value attached to gold. These days there are options like sovereign gold bonds and Gold ETFs which can fetch you returns both in the form of value appreciation and interest. Going forward you can start this paperless form of investing into gold.


Keep the investments which are doing fine and have a good future outlook, and allocate them to your goals. Give up the ones which are loss making and you do not see a scope of recovery any time soon. It’s important to cut losses when required.

Last but not the least, remember why you are investing – don’t miss the forest for the trees.

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