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Best investments options? Here's help!
January 22, 2009 08:53 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, 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.
Ishwar asked, Hi viky , for investment and tax saving purpose what is a good option mutual fund or Insurance ?... Ishwar
vicky answers, at 2009-01-21 12:17:55hi, would recommend that you consider buying insurance from a protection perspective rather than the tax benefits. decide on the amount of insurance cover that you need and then buy an insurance plan. treat the tax benefits as ancillary. from an investment perspective, let your risk appetite decide the chosen avenue i.e. if you are risk taker invest more in tax-saving funds, else, you can consider holding a higher proportion in ppf, nsc, 5-yr bank fds.
VIJU asked, Vicky - what are your views on PPF ?...and what % of savings should we ideally look at...age 30 !
vicky answers, hi, ppf offers an attractive opportunity to accumulate a corpus over longer time frames in a risk-free manner. also, the tax benefits under section 80c add to its allure. your savings should ideally be sufficient to provide for the financial goals that you have set for yourself. it would depend on each individual's specific needs.
SANJAY asked, SHOULD HDFC200 & PRINCIPAL LARGE CAP IS GOOD TO START SIP NOW
vicky answers, hi, hdfc top 200 is among the better funds in the predominantly large cap funds segment. it has an impressive track record to show for across the risk and return parameters.
RahulKumar asked, Hi vicky .. Is SIP a better option that lump sum investment IN MF.
vicky answers, hi, i would recommend investors to invest via an sip. it enables them to benefit from stock market volatility by reducing the average cost of purchase. however, being invested in a well-managed fund and having the sip spread over a sufficiently long time period is important.
Ganesh asked, Hi Vicky good afternoon. I have around 2.5 lakhs in cash. Seeing the market trend i am afraid to invest in stock market. I have a plan of going for a home after an year. so for 1 year what would be your advice for me? Where can i invest?
vicky answers, hi, 1 yr is too short a time frame to invest in equity markets. you can consider making investments in fixed deposits or debt funds.
Abhishek asked, What you say on investing in NFO is better or a on going plan
vicky answers, hi, an existing fund has a performance history to show for. in the case of an nfo, investors do not have a track record to evaluate the fund. broadly speaking, unless the nfo offers a unique investment proposition, it would be better to give it a skip.
asa asked, I have Metlife ULIP palin of rs 25000 yearly from last one year with lose of Rs App 8000/ , some say ULIP is not a good investment option , please suggest can i discountine the same and invest in mfund
vicky answers, hi, we have dealt with this topic in an article some time back. please refer to the same by clicking at http://www.personalfn.com/detail.asp?date=7/31/2008&story=3
hi asked, what is better FMP or FD with five year locking period, in case i look for the risk covered tax planing options.
vicky answers, hi, the two arent comparable. fmps do not offer tax benefits under section 80c like the ones offered by 5-yr bank fixed deposits.
raj123 asked, Hi vicky, I dont have any insurance policy, Do u suggest me to go for such policies are stay away as such policies are good only in case of one death, otherwise fetches low returns. Thanks.
vicky answers, hi, having an insurance cover is a must to provide for one's dependants, in the event of an eventuality occurring. insurance should not be evaluated based on the returns aspect.
Rajat asked, I want to invest 40K for saving tax. I already have an insurance and my motive is to get maximum returns for my investment. Please provide your valuable suggestions?
vicky answers, hi, if maximum returns along side tax saving is what you seek, then elss (tax-saving funds) is an option. however, being market-linked investments, they offer a high risk-high return investment proposition.
girijan asked, Is it worth investing in UTI Mastershare?
vicky answers, hi, there are other funds like hdfc top 200 and dsp ml top 100 that offer a similar investment proposition and have fared better.
DM asked, Which Tax Saver MF would u advise me to invest?
vicky answers, hi, please refer to http://www.personalfn.com/elss/
Kartik asked, Hi Sir are the 5 year cumulative fixed deposits with Tamilnadu Power Finance & Infrastructure Corporation eligible for tax rebate under section 80 of Income tax act.
vicky answers, hi, no they aren't. 5-yr bank fixed deposits are.
Nilesh asked, I have 1L rs can I invest them in Liquid Fund today and take back after 2 days? How much return I will get?
vicky answers, hi, yes a liquid fund is certainly an option for parking monies for 2 days.
anil asked, does lower NAV mF's give higher return? Suppose say a fund X has NAV Rs. 100/- and fund Y has NAV Rs. 20/- while buying. Suppose I invest Rs 10,000/- in both the funds then I get 100 units in Fund X and 500 units in Fund Y. After 5 years both have abs returns of 100% (calculated on face value of Rs. 10/-), which is Rs. 10/-, then the value of fund X is Rs. 11,000/- and that of fund Y is Rs. 15,000/-. So I strongly feel the low NAV gives higher returns. Am I correct?
vicky answers, hi, no. that isnt correct. a fund's nav has no bearing on its performance. to know more, please click at http://www.personalfn.com/detail.asp?date=2/13/2007&story=4
george2473 asked, FD OR MF, What wud you proposed?
vicky answers, hi, actually both can feature in your portfolio. only the allocation should depend on your risk profile, among other factors.
satish gowda asked, i am new to the shares. Which is the best company to invest as of now? My friends have advised me to go for Satyam [Get Quote] because now we get it at the cheapest rate. What shill i do?
vicky answers, hi, you should consider opting for the mutual funds route, rather than investing directly in equities. by doing so, the onus to make investment decisions lies with the fund management team.
Ghajni asked, VICKY JI PLEASE ANSWER ME >>Hi Vicky ,I have an recuring deposite in the name of my wife in a post office.Can I cliam for the Tax benifit?
vicky answers, hi, investments in post office recurring deposits are not eligible for tax benefits.
chirantan asked, have invested in various mfs, inclucing one nifty index fund, through sip route all the mfs are underperforming nifty index fund. so would you suggest to only invest in index funds?
vicky answers, hi, not really. your portfolio should have both actively and passively managed funds. in the domestic context, over longer time frames, actively managed funds have outscored passively managed funds.
kganeshan asked, what is your views on gsec funds
vicky answers, hi, in times like these, when interest rates are south bound, they can offer attractive returns. however, they arent risk free in the conventional sense, as they are often made out to be. also investors should be invested for a long enough time frame.
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 feel free to write to me at firstname.lastname@example.org
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