Do not stop SIP now

Do not stop SIP now

Dear investors, I request you to please do not stop your mutual fund SIP. Avoid redemption unless it is very urgent. I have got many calls in these days regarding stop SI and redemption as our market indices Nifty and Sensex are going down. Retail investors who have invested in equity through SIP should not end their investment. Many investors may close their SIP plans as they realize that market has not given them returns over the past 12 months.

If retail investor stay invested and continued with their SIP plan, they will end up very good return by compounding power. Since March, 2015 the benchmark indices have lost 18% from their record highs. Investing in SIP like a bamboo tree, which does not grows in the first four years, but goes and touches sky in the fifth year.

During Modi wave, market had grown 30% so now there may be some wait for next rally. Now FIIs are pulling out money but DIIs are pumping money in the market. Central government is taking so many initiatives to get fund which will deliver growth. It is very prudent decision if you stay invested in equity in these tough times.

If you have doubt about investment product and want more information regarding investment or you need investment services, feel free to ask us. We also conduct the seminar on investment and financial planning. If you are interested for conducting seminar in your city, just drop the mail.

Warm regards,

Arvind Trivedi

Certified Financial Planner

arvind.trivedi79@gmail.com

Are you feeling "Panic" ?

Are you feeling "Panic" ?

Yesterday, Indian market witnessed a shocking wave in share market. The Asia’s oldest market benchmark was down by 1624 point down. The investor’s Rs 7 lakh crore wealth wiped out in single day fall. Many investors feel panic and many see this is a good opportunity for investment. It is always good idea to buy in panic. At least you can find good company in fair value or below fair value.

Is the yesterday’s market fall just the beginning of a global recession or it is temporary blip with great pick opportunity? In my view, it is opportunities for those who have not plunged in the market till now. For those who have already invested in the market, need not to be panic. The India growing story is still intact and stay focused on. Savvy investors are investing millions of dollars into Indian companies. Indian Market is going to be huge, growing and world leading market. For traders, market always risky if their bet goes wrong so for them that does not matter whether market up or down. They totally play a gamble.

China have an economic problem so some impact is obvious on Indian market. Our CAD (Current Account Deficit) remains around 1.5% of GDP in comfort zone. We can convert worldwide crisis into an opportunity. Global development cannot impact India after beyond a point. Except for currency and stock market all other parameters are in right direction.

For investors who is looking good opportunity for investing in direct companies or in mutual fund can send mail for help. Please feel free to ask if you have any query.

If you have doubt about investment product and want more information regarding investment or you need investment services, feel free to ask us. We also conduct the seminar on investment and financial planning. If you are interested for conducting seminar in your city, just drop the mail.

Warm regards,

Arvind Trivedi

Certified Financial Planner

arvind.trivedi79@gmail.com

Are you going to invest in real estate.?

Are you going to invest in real estate..?

I know your answer would be yes that the people more tend to buy a property. The last week I have read the story about the deal of the iconic film actor Rajesh Khanna’s bungalow which is situated on Carter Road , Bandra in Mumbai. It considered a very posh area as it also have a sea facing location. Rajesh Khanna bought this bungalow for Rs 3.5 lakh in 1970. After 44 years his heirs sold it for Rs 85 crore. The property has multiplied by 2428 times or in other words annualized return og 19.38% over 44 years.

In Mumbai, there are many more examples of the same type of property deals which has given handsome returns. Samudra Mahal in Mumbai is another expensive property. A flat purchased in 1970 at Rs 700 per sq. feet was sold at Rs 1,18,000 sq. feet in 2013. Money multiplied by 168 times in 43 years means 12.66% annualized return.

In 1963 Godrej paid Rs 1 lakh to buy his first house in south mumbai. In 2011 the property was sold for Rs 25 crore. Money multiplied by 2500 times in 48 years. It means the annualized return of 17.70% over 48 years.

Now assume if you had invested Rs 100 in Sensex in 1980. Not it has become more than 27000. If dividend yield also include assume 2% then Sensex has delivered 20% annualized tax free return. It means sensex has beaten most expensive prime properties in the point of view return.

Good mutual funds and many stocks have delivered awesome return like 25% to 30% far superior to sensex itself. Unfortunately, in India the investor are least understood about this investment. Only about 3% saving goes into stocks or mutual fund. Investment in equity have one another benefit except tax free return. You can sell it anytime according to your need and get sell amount within 2 days. You need not to sell entire mutual funds holdings or stocks. You can sell stocks or mutual funds in the part. In the case of property you have to sell whole property and it is very difficult to sell immediate. In normal cases of property deals happens between 1 month to many years. You cannot sell in part of your flat or bungalow. You need not annual maintenance or local tax for your mutual funds or share holdings.

I observe many time when I meet my friends or investors that they are more willing invest into property instead of equity mutual funds. Investment in the flat or property always their first choice and they happily take loan for it if they do not have lump sum amount. They completely ignore the cost of acquisition of that property which is very significant. The cost of acquisition means the brokerage you pay the broker, stamp and registration duty, annual municipal tax, maintenance of the property and the interest you are paying on the loan.

Give some importance to equity as you give to real estate. Give it also at least more than 10 years and ignore bull or bear run of the market. If you hold it for more than 20 to 30 year you would be amazed at the fortune created for your retirement and next generation.

If you want more information regarding investment or you need investment services, feel free to ask us.

Warm regards,

Arvind Trivedi

Certified Financial Planner

arvind.trivedi79@gmail.com

www.artofinvest.com

ABKI BAAR INVEST KAR YAAR...!!!

ABKI BAAR INVEST KAR YAAR….!!!

In the last few months stock market have delivered handsome return. Some of equity mutual funds scheme like Birla Sun Life Pure Value Fund, ICICI Prudential Midcap have given more than 40% return in last six months. Retail investors have missed this early part of market rally but now it seems they have started entering in this bull rally. According to available data, in the last six months foreign investor has invested huge money but the retail equity funds has witnessed the outflow.

Although many of retail investor has already missed the rally of the market, they need not to repent. Even if you have not invested in market till date, my advice for those start investing in the market with immediate effect. In simple language my advice to all investors that ABKI BAAR INVEST KAR YAAR (Don’t miss this bull market rally, participate in it and be part of this long bull run.) There are few points to understand why I am so bullish about this bull market:

The benchmark Sensex has rallied over 20% in the last 6 months and now at around 15 PE. There are still midcap and small cap stocks whose valuations are very reasonable or below from the fair value. So there are good room for growth of mid and small cap rally.

Market may be consolidate for few months or even may be decline from current level but in the long run it will outperform to all asset class. After the announcement of election result the no. of investor has risen significantly. It indicate that more people are willing to participate in this bull run.

During 2008-13 our corporate has restructured itself and have become more competitive. The newly elected government has boosted the sentiment of business community and investor which has already reflecting in the no. of market indicies.

Nifty and Sensex are at the all time high in these days.The Indian rupee is now stable against US currency which is good sign for the economy. The corporate profits as a percentage of GDP have reduced to 4.2% in 2013-14 which was 7.8% in 2007-08. If corporate earnings become long term average 5.6% of GDP by 2018 then there would a 22% CAGR growth for in the next 4 years.

FII have shown big faith in Indian market but our domestic retail investor has not shown any faith in last six months. There are many more reasons which are indicating the big bull run in our market within next 5 year and I would like to say to every investor that be the part of this bull run. ABKI BAAR INVEST KAR YAAR…!!!!!

If you want more information regarding investment or you have any other query about investment feel free to ask us.

Warm regards,

Arvind Trivedi

Certified Financial Planner

arvind.trivedi79@gmail.com

www.artofinvest.com

www.arvindtrivedicfp.blogspot.in

Impact of general election on equity market

Impact of general election on our market

We are one of the largest democratic country in the world. The general election is the important event of our country. The financial market is keenly waiting the outcome of the election result. Our share market has also performed and made a new high as per positive outcome from this election.  Any unexpected or below from the expectation would impact badly on the market in short term. The election result would be come out on 16 May, 2014.

In my view, the outcome of election event is only important for short term. In last few trading days the volatility index has gone up significantly. Let see the market’s 2 days return after the election result:

Election Year	2 days return after election result
1999	6.05%
2004	-16.56%
2009	17.34%
2014	???

If we analyze the election result from 1991 to 2004, the sensex has given 20% return after 1 year. Although it is very difficult to predict the outcome of result but we can easily understand that business cycles will continue irrespective of any government. The long term fundamental is intact for our economy. The last few months has given a good hint for economy like CAD has come down, inflation has also cooled down, the future interest rate till October look stable and afterwards it should also soften which is good sign for our economy.

No doubt, election play important role in driving fundamental and push to the economy. I hope after election the elected government push the investment in system and growth would be on track. The delayed project will get green signal and some important decision would be take in speedy manner.

If anyone who has not invested in the equity market still, it is the right time to reap the benefit of the economy and start investing in the time horizon of 3-5 year. In the next 3-5 year, I expect the good return from the equity market. For retail investor it is the good time to enter the market for 5 year time horizon.

If you want more information regarding investment or you have any other query about investment feel free to ask us.

Warm regards,

Arvind Trivedi

Certified Financial Planner

arvind.trivedi79@gmail.com

www.artofinvest.com

www.arvindtrivedicfp.blogspot.in

What should do in this market?

What should do in this market?

In these days, our major market indexes are performing very well (Sensex and Nifty). Market indexes are at their highest points, equity mutual funds also improving performances, investor’s portfolio’s health improving in these days. Now the major questions are why equity market performing are in India and what should an investor or trader do at this point. First we are discussing about the factors which are responsible for market’s current performance.

The reason behind the market rally:

• Some people are expecting the stable and growth oriented government after the election.
• FII (Foreign Institutional Investors) investments in our markets are improving from last few months.
• Indian rupee is appreciating against dollar and it is also the major factor behind this according to me.

What should the investor do?

• If you have already equity portfolio then you must hedge your position. After market any major negative swing wipe out your portfolio valuation so hedging your portfolio are necessary to avoid any loss.
• No doubt, markets will perform good in the next 2-3 year but shot term trader should cautious and do the trade with strict stop loss as near term upside seem not much, Nifty level should not cross the 7200-7300 after even election result.
• If you are investing in equity mutual fund by monthly SIP (Systematic Investment Plan) to achieve your future long term goal then you should stay invested and before two year you should transfer your equity portfolio into debt portfolio.
• Before investing in particular company’s stock, check the company’s fundamental and valuation whether it is overprice or trading at below from fair value at present. There are still many good companies available at good price in spite of market at its life time high.   

If you want more information regarding investment or you have any other query about investment feel free to ask us.

Warm regards,

Arvind Trivedi

Certified Financial Planner

arvind.trivedi79@gmail.com

www.artofinvest.com

www.arvindtrivedicfp.blogspot.in