Category: Uncategorized

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Edelweiss Small Cap Fund – NFO Review (Jan 25,2019

Edelweiss Small Cap Fund – NFO Review

Indian Financial Market scenario – The stock market is at 10,864 at Nifty as o Jan 25th, generated  -2.5% return, the mid-cap index has shown a weaker performance with -13.5 in 1 year tenure. However, twist is Smallcap index has consistently beaten the nifty index since 2003. This is an election year. Investing in top mutual funds with SIP route would prove beneficial in the long run. 

Category analysis – As per news and market information, Nifty midcap index has generated over 20.30%, in 2 years category and 54.60% in 3 year period. Investing in midcap and small cap mutual funds through SIP has been a significant wealth generation vehicle over the years.

Midcap-small cap category is ideal for investors with high-risk appetite, believe in Mutual Fund investment through SIP. Best Mutual Fund invest in this fund in this category is through long term SIP. Top mutual funds in this category are SBI Small Cap Fund, DSP Small cap Mid cap and Reliance Small cap fund.

The fund house – Edelweiss Mutual Fund Ltd. is part of Edeweiss group, started about a decade ago, has six actively managed equity funds, four hybrid funds, seven debt funds, three ETFs and five fund of funds. Edelweiss MF Ranks at 21 as per the AUM Data available at AMFI site as on dec 2018. It is a mid-size mutual fund company with portfolio of 11,894 crore (asset under management) as per Dec 2018 data

Mutual FundEdelweiss Mutual Fund
Scheme NameEdelweiss Small Cap Fund
Objective of SchemeThe investment objective of the scheme is to generate long term capital appreciation from a portfolio that predominantly invests in equity and equity related securities of small cap companies. However, there is no assurance that the investment objective of the Scheme will be realized and the Scheme does not assure or guarantee any returns.
Scheme TypeOpen Ended
Scheme optionsGrowth and dividend
Scheme CategoryEquity Scheme – Small Cap Fund
New Fund Launch Date18-Jan-2019
New Fund Offer Closure Date01-Feb-2019
Indicate Load SeperatelyNo entry load, exit load – 1.00% <1year< NIL
Minimum Subscription Amount5000
For more information  Please Visit Website Onlinewww.edelweissmf.com (Buy mutual Fund online)

INVESTMENT OBJECTIVE   The investment objective of the scheme is to generate long term capital appreciation from a portfolio that predominantly invests in equity and equity related securities of small cap companies. However, there is no assurance that the investment objective of the Scheme will be realized and the Scheme does not assure or guarantee any returns. 

Asset allocation pattern

Investments Indicative Allocation 

Equity related securities of Small Cap companies* 65% to 100% Medium to High 

Equity and Equity related securities of other companies 0% to 35% Medium to high 

Debt and money market instruments^ 0% to 35% Low 

Where will the scheme invest?

Subject to the Regulations, the corpus of the Scheme will mainly be invested in any (but not exclusively) of the following securities: 

Investment in Equity securities: The Scheme will invest in Equity and Equity related instruments inclusive of convertible debentures, equity warrants, convertible preference shares, equity derivatives etc.

Derivatives: The Scheme may invest in Derivative Instruments subject to SEBI guidelines. Derivative products are specialized instruments that require investment techniques and risk analysis different from those associated with stocks and bonds. The Scheme may invest in the following Equity Derivative Instruments like: Futures and Options

Foreign Securities 

Debt Securities – Government Securities, Commercial papers, certificate of deposits, T-bills, fixed deposits etc.

Also, Investments in the Schemes of Mutual Fund

Fund manager details 

Name and ageEducationExperience
Mr. Harshad Patwardhan, 47 yearsB.Tech. (IIT), MBA(IIM) and a CFAqualificationMr. Harshad Patwardhan, is a B.Tech. (IIT), MBA (IIM) and a CFA by qualification. Mr. Patwardhan has an overall work experience of over 23 years in the investment management function and has joined Edelweiss AMC as Chief Investment Officer  ‐  Equity and a key personnel. Prior to joining Edelweiss AMC, he was associated with JPMorgan Asset Management India Private Limited since June 2006 as CIO‐ Equities. Prior to that Mr. Patwardhan worked for two years with Deutsche Equities India Private Limited as a senior research Fund Manager: 1. Edelweiss Large & Mid Cap Fund 2. Edelweiss Tax Advantage Fund 3. Edelweiss Multi‐Cap Fund 4. Edelweiss Mid Cap Fund 5. Edelweiss Long Term Equity Fund (Tax Savings) Edelweiss Small Cap Fund 35 analyst and has had extensive experience with several foreign brokerage houses covering a variety of sectors.  

Should You Invest? – This is best mutual fund category for inestors with high risk appetite and for a long term goal, SIP in this mutual fund category can earn investors high return over a 8-10 years period. Investor can have some exposure in this category, the fund manager is well experienced, the mid-cap fund managed by him has generated handsome return over 5 years, he has been in the fund management tea of other 5 mutual fund schemes. Other mutual fund companies like SBI Mutual Fund, DSP Mutual Fund and Reliance mutual fund have Best Mutual Fund to invest in SIP in this category. 

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Aditya Birla Sun Life Dual Advantage Fund – Series 2 NFO Review. Should you invest?

Aditya Birla Sun Life Dual Advantage Fund – Series 2 NFO Review. Should you invest?

Name of the scheme: Aditya Birla Sun Life Dual Advantage Fund – Series 2

This is an election year, a year expected to be filled with volatility in the markets and Mutual Fund companies have geared up with offerings to suit the investment behaviour of investors. To engage conservative retail investors, the fund offers high exposure in fixed income category, yet aiming to give some higher return with stock investment upto 30%, top mutual fund companies have come up with hybrid funds in many forms. 

Aditya Birla Sunlife’s New Fund offering is one such case in point.  Aditya Birla Sun Life Dual Advantage Fund – Series 2 is a closed ended Hybrid fund is highly tilted to the fixed income category. 

Mutual FundAditya Birla Sun Life
Scheme NameAditya Birla Sun Life Dual Advantage Fund – Series 2
Objective of SchemeThe primary investment objective of the Scheme is to generate income by investing in a portfolio of fixed income securities maturing on or before the maturity of the Scheme. The secondary objective is to generate capital appreciation by investing a portion of the Scheme corpus in equity and equityrelated instruments.The Scheme does not guarantee/indicate any returns. There can be no assurance that the schemes’ objectives will be achieved.
Scheme TypeHybrid fund
Scheme CategoryClosed Ended fund
Liquidity The Scheme will have a duration/tenure of 1180 days from and including the date of allotment. The NAV of the Scheme will be announced on every business day. No redemption or repurchase will be permitted prior to maturity of the Scheme. The Scheme will be listed on NSE / BSE and/or any other recognized stock exchanges as may be decided by AMC from time to timeand the Unit holders who wish to redeem units may do so through Stock Exchanges at prevailing listed price on such Stock Exchange.
New Fund Launch Date17th January 2019
New Fund Offer Closure Date1st January 2019
Indicate Load SeparatelyNo exit load , no entry load
Minimum Subscription AmountRs. 1,000/- and multiple of Rs. 10/-there after
BenchmrkCRISIL Hybrid 75+25 – Conservative Index

Intended portfolio allocation (Debt – 70-95%, Equity – 5-30%)

InstrumentsCredit Rating
A1 AAA AA A Not Applicable
Certificate of Deposits (CDs)0-5%– –––
Commercial Papers (CPs) 0-5%–
Non-Convertible Debentures (NCDs)–30%-35% 25%-30% 15%-20% –
Government Securities––––0-5%
Treasury Bills/ CBLO/ Reverse Repos/ Liquid Schemes––––0-5%
Equity and Equity related securities––––5%-30%


Source – Amfi

What is a Mutual Fund NFO – A new fund offer occurs when a fund is launched, allowing the firm to raise capital for purchasing securities. Mutual funds are one of the most common new fund offerings marketed by an investment company. The initial purchasing offer for a new fund varies by the fund’s structuring.

Investment vehicle analysis – It is a debt tilted hybrid scheme, having upto 30% equity exposure.  

INVESTMENT STRATEGY 

Fixed Income Strategy: Investments in fixed income / debt investments would be made only in securities which will mature on or before the date of the maturity of the Scheme. Scheme will invest in the fixed income / debt securities with a view to hold them till the maturity. The scheme has the flexibility to invest in the entire range of debt instruments. The actual percentage of investment in various fixed income securities will be decided after Scheme Information Document considering various factors like the prevailing interest rate and inflation scenario, performance of corporate sector, general liquidity and other considerations. 

Equity Strategy: The corpus of the equity component of the scheme will be primarily invested in diversified equity and equity related securities of the companies that have a potential to appreciate in the long run to achieve the market linked appreciation (upside) and premium of exchange traded options. The Scheme will primarily focus on companies that have demonstrated characteristics such as market leadership, strong financials and quality management. The quality or strength or management would be a key focus area

Fund manager details 

Debt Fund manager

Name an ageEducational QualificationExperience
Mr. Mohit Sharma, Age – 38 yearsPGDCM – IIM Calcutta; B Tech – IIT MadrasHe has around 13 years of experience of which 10years are in financial markets. He joined Aditya Birla Sun Life AMC Ltd on October 2015. Prior to joining Aditya Birla Sun Life AMC Ltd, he ran his own healthcare- tech business (June 2012 – May 2015). He has also worked as an Interest Rates Trader in Standard Chartered Bank (May 2007 – June 2011) and ICICI Bank Ltd (June 2006 – April 2007). He started his career in the Equity Research in Irevna Ltd (June 2005 – June 2006).

Equity Fund manager

Name an ageEducational QualificationExperience
Mr. Vineet Maloo 36 yrs B.Com.C.A. Has around 14 years of experience in Financial servicesPrior to joining ABSLAMC He had been providing analytical support to the Chief Financial Officer of Hindalco Industries Limited, prior to which he has worked with Aditya Birla Management Corporation Ltd. & M/s. D. K. Chhajer & Co., Chartered Accountants

RISK FACTORS ASSOCIATED WITH CLOSE ENDED SCHEMES: 

∙ A close ended scheme endeavours to achieve the capital appreciation only at the scheduled maturity of the scheme. However, there is no assurance that the said objective will be achieved at the scheduled maturity of the Scheme and there is a risk that the capital invested may not be fully realisable upon maturity of the Scheme. 

∙ Moreover, given the uncertain nature of equity markets, the AMC may be required to liquidate the equity portfolio and the proceeds may be kept in cash and invested largely in cash equivalents/money market instruments towards the Maturity/Final Redemption date and to that extent these investments made may not be in line with the asset allocation pattern. 

∙ Investors who wish to exit/redeem before the scheduled maturity date may do so through the stock exchange mode. For the Units listed on the exchange, it is possible that the market price at which the Units are traded may be at a discount to the NAV of such Units. Hence, Unit Holders who sell their Units in a Scheme prior to maturity may not get the NAV returns.

To invest or not – This is a retail focused fund, with a protection with high rated bonds and minimum exposure in equity. The minimum investment amount is Rs. One thousand. However, this is a closed ended fund, it means, the investors can only invest during the NFO period and exit on maturity. Investors neither can invest during the tenure nor withdraw (except demat format, one can trade depending on the liquidity). It leaves investors with no option to invest incase of a market fall or withdraw incase it has given extra ordinary return. Though the investment is for fixed tenure, it doesn’t have guaranteed return You may check https://www.amfiindia.com/new-fund-offer for FMP instruments. This is a clear NO for small and new investors. An savvy mutual fund investor can look at investing upto 10% of their cash/ fixed income portfolio in these kind of investments.

There are many balanced funds like ICICI Prudential Balanced Advantage Fund, Tata Balanced Fund etc. Incase anyone wants to block money for a period, Fixed Maturity plans with complete debt investment  may fetch bit higher return compared to fixed deposits.

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IIFL NCD issue Jan 2019, should you buy or avoid?

IIFL NCD issue Jan 2019, should  you buy or avoid?

India Infoline has launched NCD issue Jan 2019. Should retail investors buy? Bond issues targeting an assorted investors includng retail investor has been a common theme in the last year. After a series of debenture issues in 2018, now India Infoline finance has come up with an issue of Rs. 2000 crore this year.

What is Bond or NCD?

About the Company – IIFL Holdings Limited – Incorporated in 1995, Listed on NSE and BSE in 2005. IIFL has pan-India presence as well as subsidiaries in major global financial centres. IIFL is three key group companies, India Infoline Finance, IIFL Wealth and IIFL Securities.

IIFL Wealth – Family office, AIFs, advisory and distribution services 

IIFL Securities – Retail and institutional broking, investment banking 

IIFL Wealth – Family office, AIFs, advisory and distribution services 

IIFL Securities – Retail and institutional broking, investment banking 

IIFL Finance deals with Home finance, LAP, Gold loan, Commercial Vehicle, SME and Micro Finance loans. India Infoline Finance Limited (IIFL Finance) was incorporated in 2004 under the flagship of IIFL Holdings Limited and presently offers small-ticket loan products to retail borrowers, delivered through a pan India branch network of 1,755# branches and digital channels. Now it has a two ddistinct subsidisry a micro finance company and a home fiancé company.

Object of the issue – For the purpose of onward lending, financing and for repayment/prepayment of interest and principal of existing borrowings – At least 75% of the Net Proceeds of the Issue. The money also will be used for General Corporate Purposes – up to 25% of the Net Proceeds of the Issue. An investor with a demat account can apply for the issue. Issue opens on 22nd Jan, and closes on 20th Feb, however, the allotment is on first cum first served basis. NCD unit priced at 1,000, on can apply for minimum 10 units.  Issuer aims a raising funds of Rs 2000 cr

Nature of bonds – Secured and Unsecured NCDs

Credit Ratings “AA/Stable” by CRISIL and ICRA,”AA+/Stable” by Brickwork

The company offered both secured and unsecured debenture in this issue. The secured fixed income instrument offers a tenure of 36-60 months, with coupon rate varying from 9.5 – 10.2% interest. Category 1 – Corporates, category II – Non-institutional investors, III – HNIs, Category IV – Retail investors. Retail investors can subscribe upto 30% of the issue.

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Mymoneystreets take – Indiainfoline is an established name in broking, NBFC, Mutual Fund and as investment firm, it is also and established distributor of financial products. The current issue of the company is offering atleast 2% higher return compare to bank fixed deposit. With AA rating, investors can look at invest in the secured debentures. Unsecured debentures carries higher risk and higher return.   Investor can look at 30% of fixed income allocation in NCD portfolio to give it an edge and diversification.

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Top 5 tax saving mutual fund schemes (ELSS) for 2019

We approach 2018-19 financial year end, search for the best tax saving instrument under 80C ends at tax saving #ELSS mutual fund schemes. By far the best investment tool with double tax benefit, in investment and accumulation, return in is taxed at 10% above 1 lakh profit.

With the lowest lock-in period of 3 years and maximum exposure to the capital market, it is a wealth creator for young professionals or anyone who wishes to focus on long-term wealth creation through equity market. For the beginners, ELSS is an actively managed equity fund by experienced fund managers with an equally equipped equity research team. Over last 5 years, ELSS category has given over 15% annualised return on an average which is way higher than any other tax saving tools. Hence, it is my favourite tax saving instrument.

Top 10 reasons to invest in ELSS schemes –

  1.  Minimum investment for a monthly investment is Rs. 500
  2.  No obligation of repeat investment in the same fund every year
  3.  No maturity/redemption obligation on completion of 3 years (unless specified by the   fund/scheme), can withdraw anytime once the lock-in period is over
  4.  It can be held as long as the investor wants, giving it a chance to build long-term wealth
  5.  The fund is managed by able fund management teams
  6.  Low fee structure and expenses, about 2-2.5% yearly
  7.  No long term capital gain tax
  8.  Investor has an option to choose between dividend or growth fund
  9.  The dividend earned on these funds are taxed at 10%
  10.  SIP method of investing would help in cost averaging

Some point of concerns –
As it is a pure equity investment, it carries market risks, highly volatile. The SIP mode of investment signifies each purchase will have a separate lock-in period of 3 years. However, it is still recommended as a wealth creator tool. 

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Top 7 #Taxsaver #ELSS schemes for 2019

ELSS SchemesAUM in croreReturns for 3 YearsReturns for 5 yearsRatings
#DSP-BR Tax Saver Fund142025.520.85star
#Reliance Tax Saver557929.221.33star
#Axis Long Term Equity Fund995624.121.63 star
#Birla SL Tax Relief 96230824.119.84star
#Franklin India Tax Shield219622.917.93 star

I have listed 7 top ELSS scheme based on 5 parameters–

1. Funds with over 7 years existence

2. AUM over Rs. 1000 crore

3. Fund house

4. Return analysis over 5 years

6. SIP Return of 5 years

5. Rating consistency by CRISIL/ Value Research

#DSP-BR Tax Saver Fund

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This fund is out an out consistent over last 10 years. It has consistently beaten the index over 1 year, 3 year, 5 years return. This fund has out ranked most other funds in ELSS category in the period. Investment details – The fund aims to generate medium to long-term return on majority investment in equity and equity related instruments.The fund has over 20% exposure in banking and finance sector however invested mostly in private sector banks, so less chance of getting affected by NPA. It has some quality cyclic stocks.

#Reliance Tax Saver Fund

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ELSS fund with over 10 years existence, AUM over 5.5 thousand crore comes from a good pedigree. Rated 3 stars by CRISIL, the fund has beaten indices over 3 years and  5-year trailing returns. In the 1 and 2 year category, has been below the indices in many cases. It is a good investment with high-risk appetite. It has also given the highest return in the SIP for 10 years category. Investment details – This is a mid-cap, small-cap heavy fund, aims to generate wealth over long term. Fund manager looks for value buy of stocks with bottom-up stocks picking approach. The portfolio is well-diversified and spread across sectors. 

#Axis Long Term Equity Fund

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With an AUM over 9,900 crores as of 20th Jan 2017, it leads the ELSS scheme in the top position. It has lagged in last 1 year in comparison to its peers and indices, but over 3 years, 5 years returns it is in the top 5 ranks. 

Investment details – The scheme aims to generate regular long-term capital growth from a diversified portfolio of equity and related securities. It invests in companies with strong growth and sustainable business model. It has equity exposure up to 95%, given some trailing returns in the short-term but expected to even out over long term. It is still a good choice. It avoids buying companies which have excessive business uncertainty on account of cyclical, regulatory, political risks.

#Birla Sunlife TaxRelief 96   

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A fund with good pedigree has a defined track history over20 years has a AUM of 2.3 thousand crore belong to good fund pedigree. In last 1year, it is trailing the index. While in 2, 3, 5 years returns, it has beaten indices return with significant margin. It has generated over 100% return over years. Investment details– It is a multicap fund with well-diversified portfolio. However, fund has a cyclical stock bias, which has its own effect on return cycles. Well diversified in its approach, the top 5 holdings only account for 26% of the portfolio.

#Franklin India Tax Shield

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A fund with a track record over 7 years has been at par with index returns for 1 year and for over 2,3 and 5 years it has performed well above indices. This fund tends to be less volatile compared to its peers. Investment details– The process of the fund house is robust. This fund is known for having conservative approach, bottom-up style of stock picking and having growth style of investing. The fund with a large-cap bias which accounts for almost 60% of the portfolio has a 25% exposure in mid-cap, small-cap category.  Well diversified in portfolio construction, the top 5 holdings accounts for only 26% of the portfolio. 

Don’t break your head over minute investment return details, it is a game of sector allocation, Mkt-cap of companies and economic cycles. Choose a fund with a basic research and your investment style as criteria. #ELSS is nothing but an equity mutual fund and over long-term it is expected to give good returns, which also provide #tax benefits under income tax act, section 80C. However, it is advised to consult a professional financial planner before investing.

Dynamic asset allocation funds

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What are the liquid mutual funds? who should Invest in liquid fund?

If you have a question on should you invest in Debt Fund? This is the place to begin. Liquid Fund is considered to be safest, and most liquid fund, with easy investment and withdrawal options. 

Beginners’ guide to Liquid Funds

• What is a liquid fund?
In financial terms, “Liquid” means asset which is as good as hard cash. Liquid Fund is a debt fund – mutual fund which invests in money market instruments, (Money market – Market for short term lending and borrowing – Commercial papers, Company bonds, treasury bills etc.) with maturity less than a year. This fund can be redeemed in as less as 24 hours.

• Why would you invest in liquid funds?
o No entry/ No Exit load (if not withdrawn within the lock-in period )
o Annual fee 0.30 to 0.70%
o Better tax benefits than FDs (Interest is taxable according to the tax bracket of the investor) [In the dividend option returns are tax free at the hand of investor]
o The return on liquid funds is generally 50 – 100 basis points more than savings account interest
o Maximum of 10 per cent or less mark-to-market component, indicating a lower interest rate risk

• How to invest in liquid funds?
Every Mutual Fund house have liquid fund. You can check a few, also may compare in Moneycontrol/ Valueresearchonline. You can invest in these funds through online easily through the mutual funds website or CAMS app/ Karvy app or normal offline procedures. 

Liquid funds are good way to get introduced to the mutual funds – for the first timers.  You can SIP in this fund to create a contingency fund/ emergency fund. This Debt fund is ideal for short term goals/ purposes like 6 months – 1 year tenure.

*When we put our money in Fixed deposit, that is also investing in debt. 

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‘1 Crore’ – the new catchword in health insurance

The buzz word first introduced by Mr. Amitabh Bachchan, Kaun Banega Crorepati, in the beginning of this millennium had opened a dream world for the common Indians. However, it took sometime for us to sink in and consider the figure as a real achievable target. Until the early last decade till about 2005 to be precise, 1 crore was not even distant dream for most of us. Indian population was very happy with endowment plan for 1-5 lacs rupees and felt content with the ‘suposedly’ financial planning. Then came the disruption! hail the magic word Rs. 1 crore. 
Insure for 1 crore
The two new words changed the financial services of India forever. The two words were ‘Term plan’ and ‘SIP’ – systematic investment plan. 
The ‘term plan’ the true insurance product came in force in India in early 2000. The product came frill free sans the investment component. So, the newly formed private insurers began launching term-plans of 10 lakhs, 25 lakhs, 50 lakhs, 75 lakhs and 1 crore for a fraction of  a cost which LIC sold its’ endowment policies and the newbie ULIPs. The country reacted in disbelief! It took a decade, but 1 crore has became a new normal of Indian middle class, thanks to to the term insurance plans.
SIP to 1 Crore
Not to forget the aggressive promotion of ‘SIP’ by mutual fund companies harping on ‘power of compounding’ often projected 1 crore as target figure. Be in advertisement on personal finance stories, saving a few thousand rupee every month for 20 years could yield 1 crore was used as a magic figure in numerable instances catching the fancy of Indian salaried class. 
Now – Health cover for 1 crore
However, this wasn’t yet the case for health insurance industry until recently. Rs. 3 lakh to 20 lakh at the premium side was a common norm until about 2 years back. However, the healthcare cost of India has multiplied over last few years and surging way ahead of the inflation numbers. Incase of critical illness, one may have to cough-up upto INR 25-30 lakh easily only on the treatment procedure, let alone the aftercare and other financial loss causing a big dent on the resources. So, looking at the surging medical expenses and preempting the future trends, the insurance companies have launched premium insurance products with higher sum insured from 50 lakhs upto 6 crore even above. Though the product positioning may look premium, including very specialized services like global hospitalization benefits, maternity cover, organ donation etc. But eventually these services are aligining India with the global standards of healthcare. Though the premium of the products are on the higher side for now, the 1 CRORE is becoming a new normal for the health Insurance Industry too!
The few products in this category  – 
CARE Global – Religare Health Insurance
ProHealth – Cigna TTK
Apart from these, many companies do provide fixed benefit insurance for persona accident and insurance for critical insurance.
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10 things Indians are eagerly waiting for in samvat 2073

Happy Diwali n a prosperous new year 2073 friends. May God bless everybody with all the pleasures in life. With the new samvat we have new beginings, expectations and dreams. In this post, I decided to list down 10 important global and Indian events which will be closely watched by Indian investors.
1. Results of US Presidential election – The most anticipated event of the year set to unfold on 6th/7th November 2016. The fate of two presidential candidates, United States and economy worldwide is set to be deciding its new course. Though Hilary Clinton enjoying a better mindshare of audience, one never knows if Trump wins the battle at last moment and how investors react to it.

2. FED rates – This is one more game changer card US holding close to its  chest. Its been long time that FED is holding rates at 0.5% and the bonds have started yielding negative returns, FED time and again promising to increase the interest rates to boost economy, push inflation upwards to 2% (In the US), if this happens, the funds may see a return to US moment. The event is set for a december date. Hoever, there are many constraints on the same owing to various economic restraints. One need to keep a close eye on this.
3. The BASEL III norm for Indian Banks – Basel III focuses on the capital adequacy of banks primarily on the capital requirements of the banks to deal with various risks potentially faced by the businesses. Banks have been trying various methods from issuing perpetual bonds to selling preferential shares. Having the dates set for attaining the requirements at 31st Macrh 2018, this samvat will give a clear picture as in how efficiently our banking system braces for it.  
4. Defence Initiatives by India – This had been a priority for Mr. Modi for last year as well. Prime minister has been strengthening global alliances of all kinds. Be it developing and improving diplomatic associations or buying global arms and ammunitions. Modi is all set to corner Pakistan. India succesfully conducted surgical strike against terrorists as well as stopped a Hydel Dam project in Pakistan occupied Kashmir. This year Indians will eager to see consolidated action on thhe notorious neighbors. 
5. UP Elections – The most populous state of India, with maximum MP seats and having PM’s constituency set for hottest election battle in 2017. The event is already a hot topic with a intternal spat in Samajwadi party, it also can be a game changer of central governement as they have failed in the last five polls.  

6. Real progress @ Make in India – This has been a pureplay by our prime minister. The centre  has gone all out, all major and developing economies has been approached to collaborate and set manufacturing units in last two years in India. This samvat will be eagerly watched out for the real results.

Thanks to Patanjali boom and Pakistan terrorism, there is a common theme growing in general public about avoiding chinese products and buy “Desi”. This is easier said than done. But we will definitely more curious on what we are and will be making in India than ever. 

7. GST roll out– GST has been a parliament battle and with each states in terms of revenue sharing. This is a well covered topic by media. All indian states, industries, sectors and economists eagerly waiting for its implementation and the real outcome.

8. TATA &MISTRY Saga – This is just not a corporate battle, this will be a maker or breaker for Tatas, Will there be any change in the way the corporate history been written in India so far? How about investors Trust?? 
9. Reality check on avoiding Chinese goods – China is not sitting back. With  chinese companies investmenting in  Indian startups, PayTM, collaboration with OLA, China gradually but steadily entering India, now with Money. Just saying that “not to use chinese goods” is not at all a sensible talk. We are dependent on them from mechinaries to tubelights, mobile phones to door locks. It is much more deep rooted in our system than we can see. It will be a long time before we see a complete make in India. Matching their prices will be another ball game all together. 
10. The Harvests – Voila! this cannot be the last topic. Definitely not in my mind. The raingod has been generous to India this year. Having doubled my money on Escorts, and the big run I missed on fertilises and fodder socks, there is still much story left. The coming year expected to be a gala for the agriculture Industry. The rural India is smiling again. And we hope for a joyous year ahead.
To conclude, the stocks in technology, banking, agriculture and defense will be on top of my mind.
Have a great year ahead. Wish you all a happy diwali and a prosperous new year. 🙂
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How about considering mutual funds in the portfolio to build the retirement kitty!!

Invest some! Spend some! Balance it with intelligent investment decisions

Retirement is the time when you would like to do things that you like most. Hence planning for it with care and a long-term vision is most important.
Planning through equity mutual funds is a viable option to explore, given the facts that non-government employees cannot be a part of NPS (national Pension system) and life insurance companies cannot offer higher returns now after the imposition of a regulatory guaranteed return in pension plans.

The life expectancy is increasing in our country considerably, naturally people are living longer retired life. To ensure the retired life is happy and a desirable one, it is important to ensure good health and wealth for a long run. India is a fast emerging country which is known worldwide for its saving habits. But India is also known to be a conservative investor. This results in saving in instruments that guaranteed safe returns, but not high enough to be able to enjoy a good life in future. Most Indians shy away from saving in instruments that may involve a little risk, but yield better returns. In fact they end up protecting their hard- earned money in a few instruments that also yield minimum returns, rather than creating wealth.

However the ensuing circumstances are expected to pan out differently from the way they panned out for our parents and grandparents. The inflationary pressure on life and longer retired life are expected to go up. In the old age we wouldn’t want to compromise on the lifestyle we lived so far. We will travel abroad, invest in art and music, might grow an interest in photography too!! These are good reasons for most of us to create wealth in a systematic way and enough to ensure that we lead a happy and a better-managed retired life.

Employer Provident fund (EPF) and Public Provident fund (PPF) are good options which not only saves tax but also provides compounded interest of 8-9% year-on-year and have a long lock in period. These options are no-risk- free as well as tax-free on maturity. One should definitely have an exposure to these options. But as the inflation is rising high at 6-7% year-on-year, the corpus built through these funds yield lower return on investment. Hence investing in these instruments is important but would not be enough to take care of your future financial needs.

Lets beat inflation worries and create long term wealth

1. Start early and think for a long term. The earlier you start, the better are your chances of enjoying the benefit of compounding

2. A happy retirement can be planned with systematically investing a fixed amount every month for post-retirement years. A small amount saved every month for a longtime will create a sizable corpus, overtime. Rs.3,000/- pm invested in MF Schemes (yielding 12% pa ) over the working years ( assumed as 30 ), will yield tax free return of handsome Rs.1.05 crore at the age of 60 years! That’s the power of compounding at work.

3. There is no tax on long-term gains for equity investments, although debt investment like fixed- deposits and other similar instruments do attract tax on long- term gains.

4. Do consider the future healthcare cost; it would be a wise decision to make a separate kitty for your future healthcare requirements else it can cause erosion in the other expenses.

5. Diversify your investment to minimize risk and maximize returns. Put your money in different asset class to minimize risk – Debt, Equity and Hybrid.

6. Disciplined investment habit for a long term has a proven history of returns

Equity is one of the investment tools for long-term wealth creation. If we consider Indian equity market, it has seen an average annualised growth of 15% over the last 20 years. So, if somebody had made a Rs. 100,000 investment in Sensex stocks in 1990, in 20 years as on 2010 the return would have been Rs. 1 crore 63 lakhs (tax free).
However, the volatility of markets, wrong advises and fear of loosing money almost at the same rate as you would have gained in equity could deter you from taking the risk. All of us have seen this only too closely that making money in the equity market is easy; losing it is easier. Relying on tips and recommendations is like kissing your money a friendly goodbye, rather knowingly. If we buy a stock directly, it has to be something that we have done our homework on, but we won’t really know how to manage the diverse portfolio or miss out on an interesting opportunity. A better overall policy would be to use mutual funds way. In mutual funds, these nerdy fund managers invest into diverse companies and sectors. The fund management teams comprise of highly educated and experienced team of analysts who thoroughly research on companies, thus minimizing your risk and maximizing returns.

Things to remember while planning for retirement

1. Decide how much income you require to live comfortably in your post-retirement years. Consider aspects like increased medical costs, vacations but reduce costs like children’s education and rent, if you own your home. Map this income based on your current lifestyle.

2. Determine how much you need to save regularly, starting today, to have the right amount. Start allocating funds towards your retirement kitty.

3. Select a set of investment instruments that will help you meet your post-retirement requirements.

Start saving early has amazing benefits!!

Wish you all cool and rocking retired life!!

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