Most investment advice is about getting the best returns with the least risk, but with this traditional approach, would you really be able to build a high-return portfolio? What if you did the opposite by building a high-risk portfolio on purpose? It could improve your chances of getting better returns.

However, there are a few important things that you should keep in mind as an investor before trying this approach. Firstly, you need to bear in mind that the connection between risk and reward is neither predictable nor perfect. And while everyone would want to have a high-return portfolio, they require risk management along with skill and expertise in investments. Let us now take a look at what a high-return portfolio is.

• While higher return portfolios can be enticing, they come with increased risks that need careful management.
• A high-return portfolio usually consists of growth stocks, emerging companies, real estate, and alternative investments like private equity or hedge funds, adding complexity.
• Investors must conduct thorough research and possess a solid understanding of market dynamics before investing.

A high-return portfolio consists of investments that are typically aimed at delivering substantial profits over a set timeframe. Generally, these portfolios take a more aggressive approach, meaning they involve greater risk compared to safer, conservative investments. While they offer the opportunity for impressive gains, the trade-off is the increased possibility of losses due to the higher risk involved.

A high-return portfolio typically consists of one or more of the following:

1. Investment in stocks of companies that show a high potential for growth.
2. Investments in companies that are emerging with strong prospects of growth, while showing significant volatility.
3. Real estate that can generate better returns over time.
4. Private equity or hedge funds, often in the form of alternate funds come with risks but a probability of higher returns.

So, if you are planning to invest more aggressively and are looking at the top-performing funds of 2024, we have a model portfolio for high returns for you. The below-mentioned funds have been selected across multiple sectors on the basis of extensive techno-funda research, with different time horizons.

1. ICICI Prudential Bharat 22 Fof - Cumulative Option
2. SBI PSU Fund - Regular Plan-Growth
3. Invesco India PSU Equity Fund - Growth

Let us take a detailed look at what makes these three funds a part of a model portfolio.

(Data as of September 26, 2024)

Note: High-return portfolios may offer attractive potential gains, but it’s essential to carefully evaluate the risks and make informed decisions to avoid significant losses. Investors should proceed with caution, ensuring they conduct thorough research before selecting funds.

There's a direct link between the risk an investor is willing to accept and the potential reward they might gain. Simply put, the more risk an investor takes, the more they might gain or lose. High-return investments are riskier, so while there's a chance for bigger profits, there's also a higher chance of losses. These investments are often unpredictable, with prices that can change quickly. This can result in big wins or big losses. To make this clearer, it helps to look at the features of risky, high-reward investments.

Here are the rewards that you can expect:

1. Better returns

The high returns you can expect are the biggest reward of a high-return portfolio.

2. Allows diversification

A high-return portfolio is a basket of diversified assets and funds.

3. Can help beat inflation

Inflation bites into all your investments. However, with a high-return portfolio, the high returns can hedge against inflation. The value of your portfolio may grow much more than the rate of inflation.

Here are the risks of a high-return portfolio that you should be aware of:

1. High chances of loss

High-return portfolios are more prone to significant losses due to increased volatility and risk compared to conservative options.

2. More complexity

These portfolios are harder to manage, as they involve various types of investments with different risks and rewards.

3. Market timing challenges

Successfully investing in a high-return portfolio is difficult, requiring more skill and experience to navigate the greater volatility and uncertainty.