Young Investor

‘Don't put all your eggs in one basket'

BL RESEARCH BUREAU | Updated on July 23, 2011 Published on July 23, 2011

Experience is the best teacher, feels Mr Saurabh Agarwal, Director, Kennis Group, which offers structured and innovative financial products that cater to SME companies. A Chartered Accountant by profession, he also offers consulting services to entrepreneurs in all aspects of their venture including financial, accounting, legal and strategic developments.

His advice to young investors is to play by the book. As he puts it, take informed decisions, set yourself a return's target and follow it to the tee. Excerpts of the same:

How has your idea about money changed with time?

I have always appreciated the value (purchasing power) of money. I do not believe in spending blindly but at the same time I do not mind spending it wherever required. I consider appropriately spending money as an investment instead of expenditure.

Tell us about your most successful investment.

Well, I am yet to identify/realise an investment which I can call my most successful one. I am a long-term investor, who typically looks at a period of 5-7 years for any investment. That being said, I do exit early if opportunity arises. At the same time, I keep up identifying good companies for investments and add them to my portfolio.

So, what are your top financial goals?

I invest in start ups as well as emerging companies. So, my top financial goal is to see them prosper and become blue-chip companies some time in the future.

One mistake on investing or saving that you regret?

In 2007, when the market was in a boom, I too went with the flow. I invested in many penny stocks, based on just tips and I lost a good amount of money. The other was that I also missed out on timings in terms of exit since I was expecting more profits. The crash in the market taught me this - don't be greedy!

My learnings therefore are what each investor should necessarily know. And that is to always set a reasonable benchmark return on your investments and exit at the right time. Also, never invest merely based on tips in the market. Study well before you take an investment call.

Tell us about (if any) books or investment guru that have inspired you.

Well, I have mostly learnt only from my experience and mistakes.

What's the amount of wealth you hope to retire with? How are you creating this corpus?

I would not wish to quantify anything here, but the wealth should be enough to take care of my health and dreams as long as I am alive. I am building my retirement corpus by investing in mutual fund SIPs and recurring deposits in banks.

How do you plan your investments to beat inflation?

I believe in portfolio diversification with a long-term perspective. My portfolio includes listed and unlisted companies, start-up investments, fixed and recurring deposits, mutual fund SIPs etc. A proper mix of products should help me earn returns which are higher than inflation.

What's your message on savings and investing to young people just starting out on their career?

Don't put all your eggs in one basket! Plan your investments from a long-term perspective and in such a way that you should not run out of liquidity either. Money, which is left out after meeting your day-to-day needs (and this doesn't include your luxury spending) and savings for emergencies, should only be invested in risky instruments such as equity shares.

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