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Staying the course — the SIP discipline, the rebalancing thumb-rule, and the switch decision, reduced to numbers.
A portfolio is not set and forgotten. It is maintained — SIPs run through every cycle, and rebalancing follows a rule, not a mood.
The thumb-rule
SIPs always continue — allocation responds to valuation, not to headlines. Rebalancing follows one thumb-rule, read off a single number: how far equity has run.
Ignore entirely. Normal market fluctuation.
Observe. Hybrids adjust internally.
Consider rebalancing — apply the friction test first.
Deploy dry powder decisively into the correction.
Below 20% — let the hybrids work. Above 20% — the architecture was built for this. Always run the friction test before switching.
The switch discipline
The decision to move equity into hybrids is not a feeling. It is an inequality — the drawdown you would avoid must beat the tax you would crystallise.
ΔD equity − hybrid drawdown · R recovery time (yrs) · B behaviour factor (1.0–1.5) · P % switched · T tax rate · G/PV gain ÷ portfolio value. Switch only when the benefit outweighs the tax.
Illustrative advisor tool. Drawdowns, recovery time and behaviour are estimates; verify the friction test (exit load + tax) against actual statements before acting.
For education and discussion only — a framework, not personalised investment advice. All figures are illustrative; fund names are placeholders. Actual selection, allocation and switching depend on your own goals, risk capacity, tax position and circumstances. Please consult your BIRD advisor and a registered investment adviser (RIA). Mutual fund investments are subject to market risks; read all scheme-related documents carefully.
Ongoing discipline is one part of the full HNI framework — selection, construction and wealth management complete it.