Posted at 2:16 PM , on December 14, 2015
As the Sensex and the Nifty gyrate to the tunes of market triggers like quarterly earnings, RBI guidance and the Fed moves, it is time to sit back and ask a simple question. Do equities actually give the best returns among asset classes in the long term? When spoken about in a global context, the experience may not always bear out. For example, during the last 20 year period, bonds and index funds have actually given as much returns as smart equities. In countries like India, real estate in many states has substantially outperformed equities, although that market is less liquid and organized compared to equities. Then, gold during its frenzied phases like 1971-1979 or 2009-2011 have managed to outperform equity as an asset class. In the Indian context, there is a strong case why equities will actually outperform other asset classes over the long term.
Posted at 5:50 PM , on October 27, 2015
As a mutual fund investor, you need to ensure that you monitor your mutual fund holdings closely. You must ensure that the portfolio mix of your mutual fund holdings is weighted towards quality stocks and not towards speculative stocks. You also need to ensure that your fund manager is not putting your money at risk by concentrating the risk on a few companies or business groups. But above all you need to understand what are the implications of regulatory and policy announcements on your mutual fund holdings. Take the case of the RBI Credit Policy which is announced every 2 months. You need to understand how these announcements impact your mutual fund holdings.
Posted at 10:14 AM , on September 3, 2015
A mutual fund advisor or a financial advisor is a key person in helping you take your investment decisions. The relationship between an advisor and investor is advisory in nature. While any advisor would try her best to help you meet your financial goals, the relationship with your advisor can really fructify if you ask the right questions. Remember, the best of financial advisors cannot be fully effective if you do not probe the advisor and ask them questions. After all, we are talking about your goals and your resources. Nobody understands them better than you. But what is it that you need to ask your financial advisor?
Posted at 8:52 PM , on April 6, 2015
It is, definitely, a commendable fact that Indian mutual funds have managed to touch an AUM of 12,00,000 crore ($200 billion) in February 2015. Equity still accounts for about 30% of this AUM at around $60 billion. The spread is still skewed. The Top 5 fund houses viz. HDFC, ICICI-Pru, Reliance, Birla and UTI; account for 50% of the industry AUM. But that is less of a worry and more of an indication that the mutual fund industry is ripe for consolidation. The real question is; what are the challenges ahead for mutual funds? Continue reading