InvestorQ : What do you think is the ideal investment composition or allocation?
Rishita Das made post

What do you think is the ideal investment composition or allocation?

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Aastha Awasthi answered.
1 month ago
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When you diversify a portfolio, the diversification is based on your risk appetite and return expectations mainly. For example, if you have a high-risk appetite, you could go for a major equity portion, then some of the debt funds. If you also want to benefit from the rupee/dollar differences, you should include a foreign fund in your portfolio. Besides this, you could choose funds that provide some fixed income to meet your maintenance overheads. 

Secondly, you should also consider the time horizon and investment objectives. Say, if you want to create an emergency fund with other objectives, you can opt for a liquid fund since it has a low maturity, and returns are good. If you want to create a fund that you want to keep safe, i.e., no risk fund, you can opt for a fixed deposit or investment in government bonds.
 
Similarly, if you have a low-risk appetite you should consider funds such as PSU bonds, fixed-income bonds, other debt funds, and a very low composition of equity or other funds that could cause distress to the portfolio. There is no ideal or fixed composition of these funds, as it has to be ideal for you and your investment objectives
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