Views on Life & on Equity Investing

Wonder, Wealth & Abundance

Level 4 portfolio not Type 4 Investor

with 5 comments

I would love to emulate Ed Thorp (, and seek a non volatile approach to getting materially rich, but neither do I have the skills nor the time to mimick his approach.

I typically like to invest majority of my savings in the equity markets but about 5 years back I felt uneasy with the idea of having a concentrated portfolio in a single country and not feeling ‘resiliently rich’. I have right now approx 30-40 equities in 11 countries, top 10 still account for 80% of the portfolio though, would like to fix that in the future to represent 50%.

I wrote about it here that the more lower in the Pyramid, the stable your journey


No money in the obvious

I did another variant of this with a 4th TIER. 4TIER requires newer skill of Shorting. If its obvious, then there is no super normal return in it. Eg: if you short NSE NIFTY 2-3 years out (which is the Obvious) to protect/insure your Indian portfolio,

A) You lose up to 6-8% of your portfolio for buying insurance

B) Your midcap/small cap stocks will fall 40% but Nifty will fall only 15%, hence you are partly hedged.

I am still at Level 3 right at this point because of lack of time to scout of long dated cheap PUTS around the globe to put my portfolio at Level 4 (in my opinion) for my skill set.


Why Do I do Level 3 ?

Because I don’t believe I will ever have to see a 40% draw down on my long only portfolio as the correlation between the countries is very very low, so far. So, better sleep. Less correlation and more stability.

Example: We own two companies, once since the past 9 months and the other recently in the past month, one of them being a spectacularly high quality company. Despite the global sell off, these two companies made new highs on the 2nd of Feb 2018. My personal/fund India portfolio, every single stock was down. No buy-sell done in India for the past 3 months. Portfolio down 11% from the peak.

But offshore it has not budged.

LONG SOPHEON UK – A super high quality company that works with typically Fortune 50 companies on innovation. Its a 15/15 company (growth/pe)



LONG XIL ANIMATION FRANCE – Its a 50/50 company (growth/pe). Good prospects and decent quality.


A bad decision so far has been, DEFENX has been a downer for a while now, LONG DFX UK – 90% DOWN over the past six months – Its a startup. Still Long but has few B2B customers.



The correlation between India and Bangladesh equity markets is also extremely low, let alone far flung Africa or Europe.

Also read interesting patterns of fraud in Financial Shenanigans by Howard Shilit,

I hope you get ahead in your journey of being resiliently rich. As the book said, Type 7 Servant Leader ( is the leader of the future.

Servant leadership is a leadership philosophy. Traditional leadership generally involves the exercise of power by one at the “top of the pyramid.” By comparison, the servant-leader shares power, puts the needs of others first and helps people develop and perform as highly as possible. Servant leadership turns the power pyramid upside down; instead of the people working to serve the leader, the leader exists to serve the people. When leaders shift their mindset and serve first, they unlock purpose and ingenuity in those around them, resulting in higher performance and engaged, fulfilled employees.

I am not asking you but your portfolio to be Level 3/4. Its all very confusing what other want you to be. So be yourself.  Not a sermon to become a TYPE 4 Investor like a Type A personality.

We do need labels to operate in an organisation / home / world of name and designation but don’t have to internally identify with them. Enjoy the game.

Disclosure: Invested in positions discussed. Views are personal notions and do not represent any organisation or company. Investment in stock market can (and many a times do) result in loss of principal capital.




Written by amitdipsite

February 2, 2018 at 9:17 pm

Posted in Uncategorized

5 Responses

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  1. […] I was taking stock today of my long-only portfolio. Long dated puts are on the wish list for a Level 4 portfolio that I mentioned here […]

  2. Amit, this is top class thinking. Helped me a lot – to think on similar lines.

    harsha venkatesh

    March 22, 2018 at 12:24 am

    • Guess what, My India Portfolio is down 23% from the peak, Global ex-India up 5% since Jan 2018,

      Thanks and good to know it helped you 🙂


      March 22, 2018 at 12:27 am

      • Yes, I am on similar lines. Though I invest only in India and US at the moment. Your thoughts on Africa, and other frontier markets has been very helpful. I would like to reach you offline – suggest best way to do that. My email is provided when I post the comment.

        harsha venkatesh

        April 5, 2018 at 5:55 pm

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