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Rediff.com  » Business » Investing in SIPs is a good option

Investing in SIPs is a good option

October 23, 2008 07:46 IST

Are you always at a loss while planning your finances?

Are you aware of the investment options available in the market? How best can you plan your finances?

What are the crieria for evaluating an investment option? Are mutual funds profitable investment options? When and how should one buy mutual funds?

In an hour-long chat on rediff.com on Wednesday, financial planning expert Vicky Mehta replied to many such readers' queries. Here is the transcript:

vicky says, hi, good afternoon everyone. let's begin the chat.

Kamlesh asked, Is this the right time for MF?
vicky answers,  at 2008-10-22 12:32:32hi, i presume you are referring to making investments in equity funds. despite the volatile market conditions, this is a good time to get invested for the long term. of course, it is imperative that you should have the ability to take on a high degree of risk and be invested in funds that are right for you.
pankaj asked, Hi I want to invest for min 1 year..which MF plan will give me more money ....?
vicky answers, hi, 1 year is too short a time horizon for making investments in equity funds. you can consider parking money in liquid funds or opt for assured return schemes like fixed deposits
anand asked, i want to know is there any risk to invest money in mutual funds
vicky answers, hi, mutual funds are market-linked investment avenues. hence, there is a degree of risk involved. for risk-free investments, you can consider small savings schemes like NSC, PPF, among others.
Kevin asked, for how long must one be invested in a equity fund in order to get good return ???
vicky answers, hi, equity fund investments must be made for the long-term i.e. at least 3-5 years.
anand asked, how is the condition of infrastructure funds?
vicky answers, hi, infrastructure funds have fared poorly in the recent downturn. however, that is only to be expected. sector/thematic funds are high risk-high return investment propositions on account of the lack of diversification.
naresh asked, hi i have invested in MF through SIP?is my decision right
vicky answers, hi, investing via the sip mode is a good option. it takes away the need to 'time' the markets and ensures that investments are made in a disciplined manner.
Yps asked, ear Mr. Mehta, I am investing around Rs. 20000 per month in various Diversified Equity funds since Nov 2007. I am 32 years old. My funds include HDFC Equity, Kotak 30, Sundaram Select Focus, Reliance Regular Savings etc. Are the choices good and what should be my strategy to manage them so that they give good returns in the long run. I am investing to build a corpus atleast 20 years from now.
vicky answers, hi, please write to me at info@personalfn.com with details like your risk profile, investment horizon and objective.
Ravi asked, Investments in recent FMPs are safe or not?
vicky answers, hi, it largely depends on the instruments wherein the fmp is invested. investors must note that the yield on an fmp is indicative in nature and not assured.
Saj asked, Hi Vicky, What is the percentage of savings one can think about investing in Mutual Funds with the risk factor also in mind
vicky answers, hi, that would depend entirely on the investor in question i.e. his risk profile, investment objectives among other factors.
skumar13d asked, Should we go for redemption of all the MF investment, as i feel the fund managers are enjoying on our investment. What is the check on manager misusing our investment?
vicky answers, hi, the structure of mutual funds in india ensures that mutual fund investments are held by a trust. to know more about the structure of mutual funds, please click at http://www.personalfn.com/detail.asp?date=12/1/2004&story=4
navneet asked, is this the right time to start any new sip's
vicky answers, hi, sure. as mentioned earlier, if you can stay invested for the long term, have the risk profile and get invested in the right schemes, now is a good time to start an sip.
ramani asked, Are the MF units dematted? Can I demat on my oown? How can i keep track of the invt.? >>Ramani,
vicky answers, hi, only units of etfs (exchange traded funds) can be held in the demat form. for regular mutual fund schemes, the units are in physical form. tracking is possible by statement of account made available by the fund houses.
goda asked, what does risk profile mean?Are you asking if I am willing to take more risk?
vicky answers, hi, risk profile means the risk appetite i.e. how much risk an investor is willing to take on to earn a certain degree of return.
gauravbhagra asked, Hi Vicky, I am 27, and want to know about MFs, I am looking for long term investment 20-25 years, i want to invest 5-7K per month. Where do i get information nd advice related to investments, where to start from. Thanks a lot Dr. gaurav
vicky answers, hi, please write to me at info@personalfn.com for detailed information
anshul asked, apart from entry/exit loads what are the charges to look out for while evaluating MFs especially index funds?
vicky answers, hi, you should look at the fund's expense ratio. also, in an index fund, the tracking error i.e. by how much the index fund's performance has deviated from that of the benchmark index should be evaluated.
ravindra asked, Hi Vicky, are there any MF schemes wherein I can get monthly payouts after some years. My age is 30 and I want to explore this as a retirement option. Thanks a lot.
vicky answers, hi, mips (monthly income plans) are the only schemes that offer monthly returns. but the returns aren't assured. a pension plan or the post office monthly income scheme are better equipped to offer the kind of monthly returns you seek.
Laksya asked, Hi Vicky,There may be many mutual funds which has not declared any dividend since their inception. Is it god to buy such funds? Please give the name of such funds.
vicky answers, hi, a fund's dividend history cannot be the criteria for making an investment decision. instead, invest in a fund because its well-managed and makes a good fit in your portfolio.
harendra asked, hi vicky how invest money in mutual fund
vicky answers, hi, you can either opt for the services of a mutual fund advisor/agent. else, you can invest directly with the fund house and avoid paying an entry load.
pijush asked, s it a good time to keep investing in Tax Saving schemes in SIPS...?
vicky answers, hi, yes. for risk-taking investors, investing in tax-saving funds via the sip route is a good option.
fder asked, closed ended funds can be traded on exchange??
vicky answers, hi, only close-ended funds that are listed on the exchange can be traded. not all close-ended funds are listed on the exchange.
chandersen asked, please let me know where do i invest for regular income per month other than FDs?if i need to wait for safe time to invest in Equity and MF? I am senior citizen and have lost lots of money in pension plus funds recently. chandersen
vicky answers, hi, for regular income, you can consider the senior citizens savings scheme. also, you can make investments in the post office monthly income scheme.
vicky says, looks like we have run out of time. thank you all for participating in the chat. if you have any further queries, please write to me at info@personalfn.com