‘People should spend more and also be more ambitious’

livemint.com:

Edited excerpts from an interview: How is your portfolio divided? My portfolio would be 100% equities. Around 5% must be in provident fund that I’ll get on my retirement but I don’t count that in my wealth portfolio. My largest equity holding is in Motilal Oswal shares and that would form roughly 75% of my portfolio.

These are shares that I’ve received through the employee stock option scheme (ESOP) over the years. The remaining 25% is in mutual funds, portfolio management services (PMSes), and a few stocks. I invest in liquid funds from time to time but I have no allocation to debt funds.

That’s a lot of equities. How do you cope with volatility? It’s simple. I don’t look at my portfolio.

I’ve been in the equity markets for 25 years now and I’ve seen many ups and downs. I have experienced the 2000 dot-com crash, the 2008 housing crash, and of course the covid pandemic crash too. The dot-com crash was scary but with experience, you realize that every 7-8 years, there is a major crash and you have to be ready for volatility.

You got to put that much money that you don’t need and that’s why I keep so much (6-8 months) of expenses in my savings account. What’s your emergency corpus? I have at least six months of my expenses in my savings account and that’s why I’m able to invest so much in equities. This part might earn only 4-5% interest but I like the comfort of having excess liquidity.

That helps me stomach the volatility of the stock markets. You seem to have put all your eggs in one basket. Isn’t that risky? What I’m doing is not suitable for 99% of the people.