|»5 Minute Wrap Up by Equitymaster|
On This Day - 19 JUNE 2010
What are you buying now?
In this issue:
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So, how to go about allocating one's equity assets today? What to buy? Are large and mid caps the best options? Or can small caps still given the same kind of stupendous returns as they gave in 2009?
See, it's difficult to give a common allocation for all kind of investors. After all, what is right for a 30 year old investor might not be so for a 60 year old! Your allocation to these categories of stocks depends on your age, your work profile, and your future financial needs.
But roughly, you can start with an allocation of 60:30:10 for large, mid and small caps respectively. Alter it as you go along in your life and career. A review every 12 months is also a must. A proper allocation and a consistent review will ensure good returns over a 5-10 year period. After all, as we stand now, there are some very good opportunities available in all the three spaces for long term investors.
So what are you buying now? Large, mid, or small caps? Share with us
Data Source: Yahoo Finance, Kitco, CNNfn
Crude gained the most during the week, as its price rose by 4.6% over the previous week. Continued uncertainty regarding the actual impact of the BP oil spill impacted crude's price.
The RBI now seems to be making an effort to increase liquidity. It recently announced Rs 100 bn buyback of treasury bonds. We can now breathe a sigh of relief that interest rates at least will not increase in the near term. However, the inflation bugbear still needs to be tamed!
Interestingly, the latter two are urging hundreds of rich Americans to pledge at least 50% of their wealth to charity. In an interesting article, Buffett explains the thought process behind the appeal. Firstly, many ordinary citizens routinely contribute money and time to charity. Business tycoons are relatively absorbed in their enterprises and society rewards them for it. It is only logical then that they give back to society during the dusk of their career, when they can hardly consume all they have accumulated. Secondly, Buffett points out how a little wealth makes life comfortable but too many possessions only become a headache. He says, "Keep all you can conceivably need and distribute the rest to society, for its needs."
We couldn't agree more. And we also think it is time Indian business tycoons also took a hard look at philanthropy at a time when the Indian economy makes rapid strides. Leaving everything for one's children can often be a disservice to the children. There will be a lot of under privileged citizens in India in the foreseeable future. So perhaps it is time for Indian business tycoons to also give back to the society that has and will continue to make them fabulously rich.
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