Avoiding portfolio panic

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: his service provider. And this is the biggest mistake people make, says Manish Thakur, an analyst. "You got to know how you are making money and understand the reason why," says Thakur. "If you know this, you will know when to quit and book profits and not be blinded by success," he concludes. Getting accurate reports and questioning variances in service levels and also returns, is something that you will have to carry out, reckon advisors.

Going ahead, turbulent times are expected to continue. This year might even see a negative return clogged by the major indices. But this does not mean that there will be gloom all around. In fact, it is for days such as this, that the portfolio management concept was devised.

In fact, this could well be the time to re-build a strong portfolio. The markets are taking a breather and several strong prospects in the equity market would start looking very attractive, especially after a strong beating. Picking them up at regular intervals in a disciplined manner is what most managers suggest. "Set aside an amount to be invested in the market, every quarter," says Amit Sarup head of wealth management at Religare Securities.

Also, at this point in time, do review your agreement with the portfolio manager. There could be a case to change the fee structure, surmise experts. A fixed fee component might not be advisable. A clean profit-sharing structure, after being clear of desired results, could actually be what the doctor advised. This keeps the manager aware of the need to deliver returns on the parameters upon which you have agreed. Also, be aware of no-fee schemes. Such service providers gain from selling products that get them maximum commissions, and your interest takes a backseat.