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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 Irfan Rupani replied to many such readers' queries. Here is the transcript:
irfan says, good afternoon everyone, let's beginsuresh asked, HI SIR, I AM RETIRED PERSON , KINDLY ADVISE ME IF THIS IS THE RIGHT TIME TO INVEST IN SHARES AND MUTUAL FUNDS WITHOUT ANY RISK
irfan answers, at 2008-07-09 12:58:16hi, investing in equities always entails taking on risk. if you wish to invest in a risk-free manner, i would recommend investments in assured return schemes like fds, nsc, ppf, senior citizens saving scheme among others.
pks asked, Sir, how can a mutual fund be identified as equity fund or debt fund and what are the tax consequence on dividend and capital gain earned on either fund?
irfan answers, hi, mutual funds are classified as debt and equity based on the underlying investments. if the mutual fund invests predominantly in stocks/equities (at least 65%) it is classified as equity funds, else its a debt fund. in terms of tax implications, please click at http://www.personalfn.com/tax/
peter asked, Hello, My family has been investing periodically in elss funds up to tax limits from the middle of last year. All the investments are in the negative for now. Should I continue to invest more now and average down my costs? Please advice thanks
irfan answers, hi, so long as you can take on the risk associated with elss investments and have the necessary investment horizon at least 3-5 years, there is no harm in investing in well-managed elss
raja asked, which is better sip or ulip?
irfan answers, hi, the two are not comparable. sip is a mode of investment for investing in mutual funds. ulip is an avenue that combines investments and insurance.
peter asked, Hello, My family has been investing periodically in elss funds up to tax limits from the middle of last year. All the investments are in the negative for now. Should I continue to invest more now and average down my costs? Please advice thanks
irfan answers, hi, so long as you can take on the risk associated with elss investments and have the necessary investment horizon at least 3-5 years, there is no harm in investing in well-managed elss
ryan asked, Can you please suggest some debt funds for my portfolio? Many thanks to you.
irfan answers, hi, debt investments must be made taken into account the investment horizon that you have in mind. for e.g. liquid funds are fine for parking monies for the short-term (about a month). for a 9-12 month period, fmps are suitable in this environment.
contactneo asked, I am investing in HDFC [Get Quote] Tax Saver, HDFC Long Term Advantage and Sundaram Tax Saver every month (SIP) for Rs. 2000. Should i continue them or change it for someother MF. Please advice...
irfan answers, hi, in addition hdfc tax saver and hdfc long term advantage, we also like franklin shield and fidelity tax advantage.
rama asked, Hi sir,I have invested in SBI [Get Quote] Magnum Global,ICICI [Get Quote] Emerging star fund,Reliance [Get Quote] Growth Fund,Kotak Opportunities fund,SBI Contra Fund and DSP ML TIGER Fund.1000 rupees in each through SIP.Please advice whether I need any modification
irfan answers, hi, your portfolio is dominated by mid cap funds. there is a need to diversify across market segments like large caps for instance.
aparna murkunde asked, Hi, is it mandatory to have a demat account for buying mututal funds
irfan answers, hi, demat account is not necessary for investing in mutual funds. you need a demat account for stocks and etfs.
Madhu asked, i hav invested in Rel natural resources fund and also in HDFC infrastructure fund in April 08. was it a good time as now they are still below the amount invested
irfan answers, hi, you have invested in thematic funds which are badly affected by market volatility. thematic funds are suitable for investors with a high risk appetite with a view on the underlying theme.
manoj asked, Is it a good time to invest in MF or should we wait for some more days before market further goes down?
irfan answers, hi, do not try to time the markets. your investments a well-defined investment objective and clear investment horizon regardless of the market situation.
ssd asked, Hello sir,i have invested in BAJAJ ALLIANZ CAPITAL UNIT GAIN ULIP for last 2 years.What will be right time to withdraw money from it?
irfan answers, hi, do you own the aggressive ulip option? if you do, then you must remain invested in it for the long-term. do not fall for the 'invest for 3 years and then withdraw' pitch of the insurance agents.
kothari asked, The dilemma with the timing of investing in the MF is the time factor. The so called GURUS always mention about the LONG FACTOR but never give an idea about the number of years. So its a baseless decision. You have to have a mid term approach which is say about 3-12 months. is that right?
irfan answers, hi, in our view investments in equities must be made with a minimum time frame of 3-5 years.
advise asked, Dear Irfan I have mailed you my query and also put my question oj this chat several times. I hope I will get a positive reply today. I am 35 years of age have good risk appetite for 5 years atleast. I have right now SIP of 8000/- and would like to increase upto 25000/-Rs,ie wish to add 17000/-Rs more per month (Preferably in equity diversified fund). Please advice on my portfolio and also suggestion regarding SIP.I have SIP of 2000 in Reliance growth,1000 in ICICI Service industries and 5000 in Reliance RSF fund. Waiting for your response this time atleast. Thanks a lot Irfan.
irfan answers, hi, sorry i must have missed your question earlier on. its good to see you have a five - year investment horizon for equities and the risk appetite as well. regarding your choice of funds, we would like to see a diversified equity fund like fidelity equity fund, hdfc equity, dsp ml opp.
Rajiv asked, Please suggest me the right MF in which we will best returns. Sir, someone is approaching me to invest me in ING Latin America Equity Fund. Is this the right fund to invest in?
irfan answers, hi, while investing in global equities can help from a diversification perspective, its nonetheless a niche segment. investors should first aim at populating their portfolios with frontline options in equities and debt. also since its an open-ended nfo, investors have the option to evaluate its performance over a period of time and take an investment decision accordingly.
Venkat asked, I have been regularly investing in Mutual Funds through SIP and lumpsum since 2004 and find that most of my Funds are in RED like SBI Contra, DSP ML Tiger, HDFC Core and Satellite, FT Flexicap, Reliance Power Sector. While I do understand that 3-5 years is the time horizon to look at I find that it does not work well especially in extended Bull or Bear Market Scenarios. Your comments ?
irfan answers, hi, it is on account of the bull and bear markets that the long-term investment time frame of 3-5 years (at least) is recommended.
gpn asked, Hi Irfan, Is it advisable to invest in this RFHF IX Series 2 a 15 Months FMP ?
irfan answers, hi, to know how to go about investing in fmps, please click here: http://www.personalfn.com/detail.asp?date=3/27/2008&story=2
amara asked, What should be the exit criteria for coming out of an investment in MF or equities?
irfan answers, hi, to know more about when you should exit from a mutual fund, please read our article: http://www.personalfn.com/detail.asp?date=6/21/2008&story=3
kolulumatati asked, ALready exixting investments i am losing 2,5% as entry load. I have heard by directly investing the load in not taken. How do i directly invest in mutual funds
irfan answers, hi, you need to bypass the agent and invest directly with the AMC to benefit from the entry load waiver.
purnendru asked, hi, Irfan, i have abt 1 lac rs. wish to invest some where is it advisable now to invest in mf's
irfan answers, hi, you will have to first draw up an investment plan based on your needs and investment horizon. for help you can write in to info@personalfn.com
guest asked, Dividend option funds wait for the NAV to climb, rather than distributing dividends. In a declining market, all the notional gains are lost. What is the yardstick for declaring dividends?
irfan answers, hi, mutual funds declare dividends when they have a distributable surplus and the NAV is above the issue price.
Shreyas asked, I have been making investments in mutual funds partcilualry 100% equity since quite some time. Over the time during the last bull run all NAV shot up. But in recent past the investments made have turned into Negative figures as the NAV's have dropped. Can you advise whether being invested further make sense? and whether one should still continue investing in mutual funds?
irfan answers, hi, if your mutual funds are well-managed and have delivered over the long-term, you can continue to remain invested in it (or even add to your investments during a market decline). this is assuming you have the risk appetite, investment horizon and the funds that you have chosen are apt for you.
raam asked, Hello sir please mention some large cap funds.Thanks in advance
irfan answers, hi, in our view franklin bluechip and dsp ml top 100 are well-managed large cap funds.
navin asked, I have SIP of 10K per month and have already invested around 2 Lacs in MF, both via an agent. How can I bypass my agent so that entry load is not charged to me?
irfan answers, hi, you will have to discontinue your existing sip and start afresh (without your agent's intervention) to benefit from the load waiver.
AMOLK asked, Can you please suggest good Tax saving ELSS at current market conditions? Also, at current market conditions and higher bank interest rates, Tax saving fixed deposits are better or ELSS?
irfan answers, hi, elss is a market-linked investment while tax-saving FDs are assured return schemes. the two are not comparable.
AMOLK asked, Can you please suggest good Tax saving ELSS at current market conditions? Also, at current market conditions and higher bank interest rates, Tax saving fixed deposits are better or ELSS?
irfan answers, hi, elss is a market-linked investment while tax-saving FDs are assured return schemes. the two are not comparable.
popot asked, I want to invest 5000 through sip for my child's educatin . At present he is 5 years old.Plese suggest some good mutual funds
irfan answers, hi, rather than investing only in mutual funds you must aim to have a portfolio of several investments that can help you provide for your child's education/marriage, etc. to know more download our free guide on this topic: http://www.personalfn.com/investment/ms/archives.asp
sudhir asked, Hi Irfan i am new to this kind of investment. I have invested 5000 in ICICI Infrastructure (Growth) and 5000 in Tata Infrastructure (Growth) Fund. the market crashed further and my folio is red. whare else whould i invest to balance it
irfan answers, hi, for a new investor you certainly have a lot of thematic funds in your portfolio. assuming you have the risk appetite for equities, we recommend that you first a core portfolio of well-managed diversified equity funds. thematic funds can occupy a smaller portion of your portfolio if you have a view on the underlying theme.
Sandeep asked, i have invested in sahara infrastructure and Sahara Power and natural resources recently (4 days back). Was the selection of fund was good or bad at current market scenario. Please Reply
irfan answers, hi, a similar query has been addressed earlier. you can refer to the same.
nishat asked, INSURED SIP WITH SELF INSURANCE IS THE NEW IDEA. KINDLY ADVICE ABOUT THESE MUTUAL FUND.ALSO TELL US ABOUT FACILITY OF ENTRY LOAD FREE MUTUAL FUNDS
irfan answers, hi, to know more about add-on benefits offered by mutual funds, please click here: http://www.personalfn.com/detail.asp?date=2/7/2008&story=4
irfan says,
Sreejit asked, Hi Irfan, The ELSS MFs I invested in 2006, all were good at that point of time, are now slightly lower than purchase price or at par. This time I again need to make some investments for my Tax saving purposes, do you think its wise to go for a SIP or invest at one go as market is still bearish
irfan answers, hi, sips are a preferred investment mode. but you can always take the opportunity to invest (lumpsum) when the markets decline.
yash asked, Hi sir ihave invested in HDFc top 200 what r ur views
irfan answers, hi, hdfc top 200 is a well-managed diversified equity fund with an impressive long-term track record.
Niraj asked, Hi Irfan . I can save upto 15000 per month for 15 years - for my retirement . How can I divide it among mutual funds , PPF and other options .
irfan answers, hi, for a detailed response please write in to info@personalfn.com
irfan says, hi, we have run out of time. if you have more queries, please feel free to write into info@personalfn.com
Chat with Irfan every Wednesday, 1 pm
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