Portfolio review Via Negativa

July 14, 2020



 “Via Negativa” is  a negative term from the medieval times meaning through the path of negativity. The medieval thinkers/ theologians believed  that while we cannot  accurately say what god is ; we can quite easily say what god is not. This thinking can be applied to every sphere of life. The simple trick seems to suggest  eliminate the downside,  possible selection errors and the  upside will take care of itself.


When the pope wanted to know the secret of Michelangalo’s craft how he had flawlessly created the statue of David, Michelangalo’s reply was seemingly  obvious ”I removed everything that was not David”. Again the aspect of removing the irrelevant to bring the greatest relevance.

In the context of Investments & Portfolio management, this means that you need to take care to reexamine your investments about eliminating the downside, re examine the selection criteria for your portfolio and course correct in these new times, rest assured the upside when it happens will automatically take your portfolio up.

So therefore the focus needs to be on all those negative attributes that is possible. 


Here are few examples:





  1. Revisit all your FDs, Bonds, Debt Funds to ensure that the funds that you are invested in are safe from defaults and downgrades 

  2. Look not for higher returns, but for higher safety as these are difficult times and highly unpredictable 

  3. Look at creating more liquidity as per your need, as your business needs or on account of your salary cuts




  1. Move out of all high risk portfolio especially sectoral funds like  IT fund, FMCG funds, Infrastructure funds.. these are not meant for retail investors and certainly not for buy and hold strategy ;

  2. Check  your holdings in Midcap & Small Cap funds ; if you have a 5 year plus horizon, you are good with these funds, else reexamine these holdings as well ;

  3. Move into diversified equity funds or Index funds for the lowest negative impact in the medium term.

  4. Revisit your asset allocation more to check if you are comfortable with the debt : Equity mix of your portfolio


Nassim Nicholas Taleb defines Via Negativa as, “The principle that we know what is wrong with more clarity than what is right, and that knowledge grows by subtraction.While I am at all times a champion of Positive thinking and vouch for how it has enabled me to stay sane and mentally healthy at the most trying times.

I dare say that occasionally running a negative filter across all aspects of your life will help you be better prepared for what life has in store. So in the investment context, do don the negative lens and check your portfolio for possible flaws and see what actions you may need to take to overcome them. Once done you can take of the negative lens and continue to hope for the best , cause that is exactly what will happen.


Finsherpa will be delighted to offer a FREE PORTFOLIO REVIEW, write to us at info@finsherpa.com.
































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