3 Stocks That You Can Buy Every Month To Build A Sound Portfolio

There are a few stocks that have given returns consistently over the decades. Some of these continue to have growth potential and hence can be added to your portfolio every month. Here are 3 such stocks.

Reliance Industries

Over the next few years, the company is likely to have very good growth rates, thanks to Jio Platforms and Reliance Retail. Apart from these the oils to chemicals business is likely to continue to do well.

We believe that adding some shares of Reliance Industries every month, can help individuals build a good sound portfolio. Apart from this, during the first six months of the covid era, when almost all stocks had plunged, Reliance was one stock that was climbing, thanks to a more defensive play in telecom and retail. Of course, it had also sold shares in Jio Platforms to some companies. If there is a possibility of a stake sale to Saudi Aramco in the O2C business, this stock could surge even further.

ITC

We like this stock because of its dividend yield of around 5%, which means adding to our portfolio would only help to generate good dividends. Again, almost all of its divisions are more defensive plays, including the larger cigarette and FMCG play.

In fact, the FMCG business has got some very good brands like Aashirvaad, Bingo, B natural, Vivel, Fiama etc. The stock is also not too expensive at around 20 times one year forward earnings. Individuals can add this stock every month to your portfolio for regular dividends and as a good defensive play.

Infosys

This stock has seen some dip in the last 1-week, following a battering of tech stocks in the US. This is another stock that has been delivering returns for decades now and with regular dividend payouts and yields, the stock is a good bet.

We continue to believe that the next few years would see robust economic growth rates in the US, which should propel spending by companies there. This could lead to good prospects for companies like Infosys. The share are also available at a dividend yield of 1.58%. So, an investor also gets regular dividend from this stock. Overall, we believe that all the three stocks listed above are good for yielding good dividends.

The one good thing of buying every month is that you avoid the risk associated with lumpsum investment, which can be risky.

Be discreet when investing

We have been telling our readers regularly that the markets are overvalued and avoid investing lumpsum amounts. Invest in this market only through the Systematic investment route. Even if you are looking at stocks, it makes sense to invest small amounts every month, rather than a big large sum. The price to earnings multiples of the Nifty companies are significantly higher than the long term averages. With inflation likely to pan out, thanks to rising crude prices, companies may face cost pressures.

Disclaimer

Investing in equities is risky and investors must therefore understand the risk. The author and Greynium Information Technologies Pvt Ltd would not be responsible for any losses caused based on the article. The author and his family do not hold shares in any of the companies listed above.