We take pride in our ability to simplify your entire financial profile (investments, tax, insurance, estate planning, etc.) in an easy to understand picture that can make immediate and long term goals attainable.

Advisors work with a variety of clients regardless of the stage they are in life:

• For the young professional, we lay the groundwork for a monthly savings plan that will grow his/ her nest egg
• For the retiree, or the industry veteran approaching retirement, we can systematically plan for your income, insurance, and estate needs as you age
• For the business owner looking to implement a retirement plan for his firm, we will work with you develop a plan that will attract and retain talented employees while benefiting from both an individual and corporate tax perspective

So much of your life is spent earning, paying, and saving money.  You need a financial advisor to guide you and help ensure that your finances are managed properly and that your assets are always working for you and your family.  Let a trusted financial advisor, like Shashi Investments, show you the way.

The saying “don’t put all your eggs in one basket” defines diversification in investment advisory. It is this wisdom, perhaps passed from one’s parents, of not putting everything you have in one choice that should absolutely be followed in investing.

IMPORTANCE OF DIVERSIFYING INVESTMENTS
Through diversifying your investments, you have a greater probability of capturing investment opportunities over the long-term, while at the same time helping to minimize those concentrated risks of being overly exposed to any particular investment in the short run.

Investors do not like to think of periods when the market is in a recession, but during recessionary cycles, diversification may limit your exposure to market loss. For example, during 2008, the stock market performed poorly while treasury bonds performed positively. The opposite may be true during a bull market. For this reason, you want investment vehicles in your portfolio that may perform well during all market cycles.

REDUCING PORTFOLIO VOLATILITY
Diversification allows one to reduce portfolio volatility, as it is volatility that makes investments move like a roller coaster. Volatility, for some, is what makes investing difficult and invites emotion to cloud the logical process of investing.

Diversifying investments into buckets (including Indian Stocks, International Stocks, Domestic Bonds, and International Bonds), aids the investment process by dampening volatility because typically all asset classes do not move in unison. Put simply, diversification allows for your portfolio to have a smoother ride. It is through the process of diversification that you can match your capital need and investment goals. For example, you can invest in CDs and bonds for capital you know you’ll need in one to two years, while the stock component of your portfolio can be for the capital you’ll need in the next decade.  Everyone will have a different asset mix or diversify differently.

DIVERSIFYING PORTFOLIOS IN DIFFERENT FINANCIAL MARKETS
However, we believe every portfolio should have broad enough exposure to capitalize on the opportunities available in the financial markets. These opportunities come in the form of:

• Stocks
• Bonds
• Commodities
• Alternative investments
• Private equity
• Real estate

The act of diversifying requires financial planners, like those at Shashi Investments, to examine your entire financial profile and find the allocation that best meets your objectives. Lastly, diversification requires your portfolio to be flexible enough to reallocate and rebalance so as to not be too underweight or overweight in any one sector or strategy.

The biggest question in investing is “Where should I invest my money?” Investors often wonder whether they should invest entirely in stocks, bonds, or a balanced mix of both. Aggressive allocations tend to be all stocks, while conservative allocations tend to be all bonds and cash. Having an asset allocation strategy in place provides discipline and guidelines for investors.

ASSET ALLOCATION STRATEGY & INVESTMENT OBJECTIVES
Having a disciplined asset allocation strategy allows one to stay focused on meeting their investment objectives. Right or wrong, emotion always makes way into investing; however, having the right asset allocation will remind you of your investment objectives.

HOW TO SET YOUR ASSET ALLOCATION
The simple answer to what your asset allocation should be is: the one you are comfortable with and understand to reach your investment goals. Here at Shashi Investments, we cater your asset allocation to align with your time horizon, investment goals, and risk tolerance. Specifically, before we invest your hard earned capital, we examine your entire financial profile to ensure we are investing to align with you and your family’s goals. It is for this reason that we do not believe in a “cookie cutter” approach to investing. If your current investments keep you up at night, and you are constantly worried about the direction of your account, it is likely that you are not allocated correctly. A financial planner’s job is to help you match your current situation and time horizon to an allocation that will help yield the highest probability of success in attaining your financial goals. For example, with a younger investor who has several decades of earning ahead, it makes sense to plan for her retirement by having a higher allocation to stocks than any other kind of investment. Our logic in this instance is that over time, we believe stocks outperform bonds and bonds outperform cash. It is for this reason that retirees should consider a more moderate allocation, whereas a younger investor just starting in their career can consider being aggressive.

The Risk of Holding Too Much Cash
Another concept that we consider when implementing your asset allocation is that over time, one of the biggest risks to any asset allocation is holding too much cash. Yes, cash should be kept to maximize buying opportunities; however, it is important to understand that sitting in cash may cause a significant loss of purchasing power if used as a long-term investment because of inflation.

THE MOST SIGNIFICANT DETERMINANT TO ASSET ALLOCATION
A simple example of this is comparing gas prices in the 1980s to gas prices in 2000s. The most significant determinant to asset allocation is your time horizon because time is an investor’s best friend. The more time you have, the more risk and reward opportunities available. This is also why your asset allocation must be flexible and change as you get closer to your investment goal. It is our job to identify how to adjust your asset allocation and manage risk.

One of the more frequent questions we receive from people is determining how much they should save for retirement. Many individuals and families who have members approaching retirement or are already retired are concerned as to whether they will outlive their retirement funds. The answer to this question, of course, is different for everyone.

SET YOUR GOALS & IDEALS FOR RETIREMENT
In order to compute an amount necessary for retirement, you first need to set some goals and ideals for what your retirement will look like. Do you plan to live where you are or move somewhere else? Will you downsize or keep your current level of spending and living? Would you like to travel? Will have your mortgage on your home? How is your health?

PERCENTAGE OF YOUR CURRENT INCOME
Answering these and similar questions can help set a base for your retirement needs. One way many people calculate their retirement needs is to take a percentage of their current income. For example, if you and your spouse have a combined income of Rs. 1000000 now, when retired, you may take a percentage of this, say 70%, as needed upon retirement. In other words, your investment portfolio in combination with Social Security and any other income, must be able to provide Rs. 7000000 per year.

BUDGET YOUR CURRENT EXPENSES
A different way to calculate retirement needs is to add up your current expenses. For example, if your expenses add up to Rs. 750000, you will need that much each year after retirement. You can analyze your specific expenses to determine if they will be greater or lower. Many retired couples find they only need one car and can avoid extra auto insurance and gas expenses.

DETERMINE HOW YOU WILL FUND RETIREMENT
Once you have determined your needs, you can plan for how you will fund retirement life. Areas such as Social Security, pension plans, annuities, and other means of providing income can be reviewed. Next, you can figure out the total investment portfolio needed to make up the difference.

Assumptions must then be factored in to determine rates of return of different investment opportunities during the accumulation time before retirement and then during the distribution time after retiring. Various “What if” scenarios can be modeled at differing levels of risk vs. return. This will help you see if additional funds must be invested, higher rates of return must be sought, or retirement expectations must be revised.