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 Wednesday, financial planning expert Sailesh Multani offered some valuable tips. Here is the transcript:
Sailesh says, Goodafternoon everyone, lets start the chat session
KAYK asked, Mr Multani: Good afternoon. How do you rate the below assignment for the next 5 years (untouched)? DSP BR Top 100 (30%), HDFC Top 200 (30%), Sundaram Select Focus Large Cap (20%), Reliance RSF Growth (20%)? Please comment
Sailesh answers, at 2009-09-02 12:58:39hi, all these funds are top of the line. You should continue holding the same
rahul asked, is this the right time to invest in ELSS mutual funds ?
Sailesh answers, hi, yes it is a good time to invest in ELSS. Stock markets are likely to do well over the next 2-3 years. ELSS funds are diversified equity funds and will benefit from the same
Panchal asked, Recently i had done my financial calculations done. He said I need 2.0 Cr. as fund value post retirement inorder to live the life style as per current status and advised me to invest in MIP for mutual funds. would it be wise to invest ? Also i was suggested to opt for term insurance inorder to secure my family in case of any exigencies ? Please advice
Sailesh answers, hi, the choice of investment in MIPs will depend upon your risk appetite and time to retirement. IF your retirement is 3-4 years then investing in MIPs makes sense as MIPs typically invest 20-25% in equities and balance in debt. If your retirement is 10-15 years then ideally your asset allocation should be 70% in equity and 30% in debt. For protection and risk management, you should definitely opt for term insurance which offers maximum sum assured at the lowest premium
Kumar asked, what about L&T fixed deposites for 5 to 10 yrs?
Sailesh answers, hi, you can invest in L&T FD for 5 years. The yield is attractive
pu asked, Hi sailesh, For an age of 25 years with investment of 10k per month which will be best investment strategy
Sailesh answers, hi, since you are 25 years of age and assuming you are saving for reitrement then you should ideally have 70% in equity and 30% in debt. Farther the goal higher should be your allocation to high risk asset class like equities. Please make sure that you are willing to live with volatility if you are investing in equities.
SONALIMITTAL asked, I HAVE TO SHOW TDS TO MY COMPANY...IT SHOULD BE MINIMUM 1 LAKH...IN WHICH PLAN SHOULD I INVEST...
Sailesh answers, hi, you can consider investments in PPF and ELSS for your tax planning. Also if you have not taken an insurance policy then go for a term plan and the premium on the same can be counted as a part of the Rs 1 lakh tax saving limit under section 80C
Mohini asked, Hi Sailesh , I would like to invest in for a good child plan can you suggest me some of them. Also can I avail tax benefits on the same?
Sailesh answers, hi, to plan for your child's higher education and post graduation and marriage you should make an investment plan for each such objective. The plan will tell you how much you need to save every year and in which asset class. I would not recomend any child plan from any insurance company
omar asked, sir can u tell me the expected time when the bank fixed deposit rate will increase?
Sailesh answers, hi, the interest rates are not likely to go up before Janauary 2010 due to adequate liquidity in the system. I would recommend that you invest in a 6 month FD and when the interest rates acutally move up, you can renew the same at a higher rate
sanjeev asked, I had invested in Fidelity Guilt Fund and ICICI Gilt Fund 10 months back but the Returns are Negative -- please SUGGEST what to Do ?
Sailesh answers, hi, the interest rates are likely to move up in the next few months and hence gilt funds will no do well. Gilt funds give reasonably good returns only when the interest rates in the economy are likely to go down. The 10 year bench mark yield is already reached 7.45%. If there is a rally in the next few weeks you should consider moving out of gilt funds. Gilt funds can outperform FDs only if your investment horizon is 3 years and more. The investment in gilt funds has to be more tactical i.e buy and hold may not hold true for them
kapil asked, Sir, I am currently investing in the balanced funds like HDFC, SBI, DSPBR through sip from last 1 year. Should i continue or go for diversifed funds of HDFC, DSPBR etc.
Sailesh answers, hi, in my view HDFC Prudence and DSP BR Balanced Funds are by far the best funds in the category. continue your SIP in them
maoxlnc asked, waht percentge of gold versus total investments is ideal
Sailesh answers, hi, in my view you should atleast have 15% allocation to gold. Gold as a commodity is likely to do well over the next few years, hence 15% allocation
tsv asked, Hi Sailesh...I want to invest Rs L3L in mutual funds and Rs 2L in Stock with investment horizon upto July 2010...can you please suggest what should be my strategy?
Sailesh answers, hi, July 2010 is only 11 months of investment in equity. It is certainly not the ideal investment horizon for investment in equities which should be atleast 3 years. Thoguh the stock markets are likely to do well over the next few years, investment for 11 months certainly is not the right move. I would not recommmend equity investment for less than 3 years
polackal asked, Sir, Good AfterNoon What investment avenues would you suggest keeping a time horizon of 5, 10 & 15 years Assuming regular investments during the said period. I hope you will agree that regular investments are always better than lump sum investments.
Sailesh answers, hi ,yes regular investments like SIPs are always better compared to lumpsum investments. While it is difficult to suggest a standard asset allocation for time period of 5,10 and 15 years, I would invest in the following proportion - 5 years - 50% in equity and balance in debt, 10 years and above 70% in equity and balance in debt. Please assess your risk appetite before investing in equities to ensure that you are ready to ride the volatility
Shuchi asked, i have a mutual fund portfolio of DSP BLACKROCK LYNCH T.I.G.E.R FUND - GROWTH , KOTAK OPPORTUNITIES , RELIANCE GROWTH FUND , RELIANCE VISION FUND , RELIANCE DIVERSIFIED POWER SECTOR , RELIANCE REGULAR SAVINGS FUND-EQUITY PLAN i invest in these mutial funds ....is the portfolio balanced
Sailesh answers, hi, you portfolio is not balanced. You have too much of exposure to one fund house i.e. Reliance. Also you are not invested in top of the line funds like HDFC Equity and Franklin India Bluechip Fund. DP TIgher and Reliance Power sector are highly concentrated portfolios. You need to move in to diversified equity funds like the ones suggested
vish asked, Hi, I have invested around 35K in MF last year. I have not remeemed my money from MF. I am planning to keep this amount for long term in MF. Is is advisable to park my money in MF for long term (3-5 years)? If yes, what would be the returns?
Sailesh answers, hi, yes, its good proactice to invest in equity funds with a long term view. By long term i mean atleast 5 years. You can expect returns in the range of 12-15%
Amar asked, Hi Sailesh, do you think MIPs are a good alternative to FDs? I am primarily thinking of this from a taxation perspective. What should be the investment duration in this case for MIPs?
Sailesh answers, hi, returns from MIPs are not assured and linked to performance of the debt and equity markets. Hence, to benefit from the same your investment horizon should be atleast 18-24 months.
RAJU asked, Hello sir, I have invested Rs.10L in share AND 10L in BANK.Is this ok
Sailesh answers, hi, your asset allocation is 50:50. Though it is balanced, check if it is geared to achive your short term and long term financial goals. Also, if your goal are 7-8 years away then you can increase the exposure to equities
Balaji asked, Hi Sanjeev, I am 30yrs medium risk investor. I have the following investments in MFs. Please suggest if I can continue with the same schemes OR switch any of the schemes to new schemes. Fidelity Equity Fund - Dividend11,471 Fidelity Tax Advantage Fund - Dividend14,771 Fidelity Wealth Builder Fund Plan B - Dividend Option12,274 SBI Magnum Tax Gain Fund-Dividend 29,095 Franklin India Taxshield - Dividend 45,032 Franklin India Prima Fund - Dividend 05,509 Ft India Dynamic Pe Ratio Fund Of Funds - Dividend 09,678 HDFC Long Term Advantage Fund-Div28,923 HDFC Tax Saver-Dividend25,871 Taurus Tax Shield - Dividend07,500 Apart from the MFs, I have other investments as follows. Please advice should I move some of these to Equity MFs Bank FDs95,000 Corporate FDs25,000 Shriram Transport - NCD10,000 Would highly appreciate your help. Thanks & Regards
Sailesh answers, hi, except for Taurus all your funds are good. Ensure that your overall portfolio is balanced and suited to your risk profile and investment horizon. If your goals are 5 years aways then the ideal asset allocation can be 50% in equity and 50% in debt. Also, you should have some investment - at least 10% in gold. Invest in gold through the ETF route
shanker asked, hi sailesh, i asked earlier that what would be the best investment option for a new born boy, could u please suggest anything
Sailesh answers, hi, for your new born child, you should condier investing in diversified equity funds. Open a bank account in the name of your child and start an SIP. Even small investment of Rs. 1000 per month for for 10-15 years will result in a sufficiently large corpus to meet future expnditure on higher education and post graduation.
niiii asked, hii...i am investing monthly 5000 rs in the following three fund. Can u tell me hws it for tenure of 5 years. 1. Birla Sun Life Frontline Equity - 2000 per month 2. ICICI Prudential Discovery Fund (Growth) - 2000 per month 3. Reliance Monthly income plane Growth - 1000 per month
Sailesh answers, hi, these are good funds though you can consider HDFC MIP - Long Term over Reliance MIP
Sunny1 asked, I am investing 4000 rs per month in different TAX SIP's, 5000 in PF. Now I want to invest in Gold also, should I go for buying physical gold or GOLD ETF? What is the way to buy GOLD ETF ? ALso i want on invest in one of the diversified MF SIP? which one should i chose ? FOr eg. HDFC Top 200 ?
Sailesh answers, hi, invest in gold via the ETFs rather than buing the physical gold. Its easy to buy and sell and hence you can take take the advantage of any increase in price. Also, in case of ETFs, units are held in the demat account. Hence there is no worry regarding the safe storage of the same. For buying gold ETFs, you will have to buy it through your stock broker like you buy any other share. HDFC Top 200 is a good equity fund to invest in
niiii asked, Hii..i want to invest 5000 per month in a mutual fund for 3 yrs horizon suggest 2 equity and 1 debt mutual fund.
Sailesh answers, hi, invest in HDFC Equity Fund, DSP BR Balanced Fund and HDFC MIP - long term
Rajendra asked, Hi I am 50 and I can save 15000 Pm Where should I invest
Sailesh answers, hi, given that you have 5-10 years towards retirement, you should consider investing more in debt as against equities. Ideally you should have an asset allocation of 50:50 towards equity and debt.
anand asked, hi sailesh, i have insvested 3L in MF in the last year that time market is at its high. now my money became 2L, what do you suggest shall i hold MF for some more period?
Sailesh answers, hi, if the funds you have invested in are suited to your investment objective, risk profile and time horizon, you should continue to hold on to your current investments. Always invest in diversified equity funds with a time horizon of 5 years
Milind asked, How is NPS to invest? I understand it works like a MF without the charges. Is it still better than MF ( with their entry loads being knocked off)?
Sailesh answers, hi, its too early to take a call on the performance of NPS. Yes, it will work like a MF but I would recommend wait and watch as far as NPS is concerned
Harneet asked, Hi Sailesh I am investing in the following funds and bank Recuuring deposits Per Month 10,000 RELIANCE GROWTH FUND-RETAIL PLAN - GROWTH PLAN 3000 SBI tax gain magnum - growth 2000 HDFC Top 200 2000 Franklin Prima Plus 2000 Sundram - Select Midcap Apart from these I have around 25000 going into bank rd's is this portfolio correct or should i change my strategy Thanks in advance
Sailesh answers, hi, you have invested in debt and equity but not gold. I would recommend that you start investing in gold and increase your expousre which should be atleast 10% of your total portfolio.
Seema asked, Sir Good afternoon, I would like to invest around 5000-10000 monthly, but i need liquidty like bank FD's, what are the options available
Sailesh answers, hi, apart from FDs you can consier investing in liquid funds. Even open ended equity funds can be liquidated with ease and money is credited to your account in 3-4 days but investing in equity requires longer time frame like 3-5 years with very high apetite for risk. If you are looking for safe investment then liquid funds are the answer to your question
fizz asked, Is LIC's Child fortune plus a good scheme to invest in ? it is a sort of a SIP like scheme. it also gives a insurance policy together. plz advice IF YOU CANNOT ANSWER PLZ LEMME KNOW.
Sailesh answers, hi, to plan for your child's future I would not recommend an insurance policy. The best approach would be to create a portfolio of well managed equity and debt funds/FDs. As far as insurance is concerned, you need to cover the risk by taking a term plan for yourself.
kk asked, hi, I am 33 and investing SIp of Rs. 9000 pm in following 9 mutual funds each of Rs. 1000. Please suggest if I can continue or should change any script SBI Magnum Comma Fund (G) HDFC TOP 200 (G) SBI MSFU Contra Fund (G) RELIANCE Equity Opportunities (G) RELIANCE Regular Saving Fund Equity (G) KOTAK 30 (G) RELIANCE Growth (G) BIRLA Midcap (G) RELIANCE Vision (G) Please give your expert ideas so that i can modify my portfolio........I am a medium-risk investor........
Sailesh answers, hi, you are investing lot of funds. You can restrict the number of funds to 6. Consider knocking off SBI Magnum Comma,SBI Contra and Reliance Equity Opportunity from your portfolio.
Sailesh says, We have reached the end of chat session. I thank you all for participating in the chat. If you have any further queries, please feel free to mail me at : email@example.com