REBALANCING ACT

IT IS CRUCIAL TO ASSESS A PORTFOLIO AT LEAST ONCE IN SIX MONTHS

- NACHIKET KELKAR

In the last financial year, 41 million new demat accounts were opened by domestic brokerages.

Total mutual fund folios touched 23.45 crore and retail MF folios, 18.58 crore. Around 26,000 crore comes into mutual funds through systematic investment plans (SIPs) alone every month.

The past few months, however, have not been rosy, with markets entering a correction phase. Equity mutual fund flows declined for three consecutive months, as investors, uncertain how the tariffs imposed by US President Donald Trump will pan out and how it will impact economy and capital markets, turned cautious.

Investors who had pumped money into the markets started pulling out with equal vigour to minimise their losses.

Amid the upheavals, one thing many people are not focusing on enough is portfolio rebalancing.

Essentially, it means reassessing a portfolio and adjusting it according to the goals and the prevailing risks.