Process







When I started this blog, one of the objectives was to share my journey in achieving my long term wealth building goals. In the process, I expect to continue my learning process by discussing contrasting views, and hopefully make smaller mistakes. This page acts as a one stop location to describe my investment process in a broader context. You may also consider this as an index page which I will update as and when necessary.


Step 1: Investment Goals

These are series of articles which shows what went behind setting up my goals and what my thought process was in this process.


Step 2: Investment Principles and Rules

Some of this work shaped my investing principles. I describe the rules I use to manage my portfolio. This is a starting point because I do realize that these are intangible rules. In future, I will need to make tangible and quantifiable rules.


Step 3: Risk Profile

I discuss how I define my risk profile and how I use it to translate into my investment strategy.


Step 4: Investment Options

This provides an overview of my investment strategy and different investment buckets. I have defined my investment buckets based of my objectives. These are not an asset allocation for my investments.


Step 5: Portfolio Performance Matrices and Measuring Progress

Articles here discuss the performance measures I use in evaluating my portfolio. I present different matrices such as my benchmark, cash flow, yield on cost, annualized XIRR, portfolio value, asset allocation, and risk analysis.


Step 6 (a): Portfolio Building – Watch list and Analysis

I discuss how I do my investment screening and further analysis so that it can be put on my watch list or buy list. I use both qualitative and quantitative aspects. I generate watch list and/or buy list based on this screening and analysis process.


Step 6 (b): Portfolio Building – Accumulation

Depending upon the available funds at a given point in time, I start accumulating stocks. I may buy new stocks or add to existing ones.


Step 7: Portfolio Monitoring and Rebalancing

Measuring your progress at regular time intervals tells you whether you are going in right direction, and if necessary forces you to make adjustments (i.e. re-balancing)


Step 8: Exit Plan/Strategy

When I started investing using an income-based approach, I had a very fixed perspective that I will be buy-and-hold investor. However, I have realized that sometimes it is necessary to make midstream changes. If your investments deviate from your expected objectives, then you need to sell. It is prudent to remove an apple gone bad and follow re-balancing strategy.


This provides a summary-level procedural framework for my investment process. The associated articles should provide readers detailed insight into my portfolio management process vis-à-vis its objectives.


Disclaimer: This is my investment process compatible to risk I am willing to take, the resources I have, and the amount of time I am willing to spend on managing it. Individual investors who plan on following this process or advice should evaluate this using their own risk profile and their own situation.


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