Over the past 15 days or so, we have received an overwhelming number of portfolios with list of stocks for re-balancing. Certainly this is an encouraging thing.
Naturally, it has been difficult to reply individually to all requests. I have tried to and will continue to answer clients over the course of this week. Ideally, instead of looking at markets for a 5% up or down over the next few days, in light of all that is going on, rebalance your portfolio with the next 12 – 18 months in mind.
While I am not negative on financial services, I do believe this is a sector where a lot of money has flown in after Demonetization. While the sector will fundamentally benefit from this news, I would like to reduce allocations here, in favour of stocks from the infrastructure space particularly in power and construction.
Further, while this may be a contra-call, I do believe a couple of midcap stocks in the consumer discretionary space have fallen to unreasonably low levels. While I do agree that spending on consumer stocks will reduce for this and probably for the next quarter. This is an excellent time to buy stocks in this space. I continue to be positive on Oil & Gas and Housing finance.
Based on the above here is a list of 6 stocks which every investor should add in their portfolio at current prices with the next 18 months in mind.
Potential return: To my mind, most of these stocks could give you handsome returns but instead of choosing 1-2, allocate money as suggested. Upside 30-60%.