Time n Tide Wait for None
Start Investing Early.Don’t delay. Delay of 5 Years is going to cost you heavily.
Picture this. Ram startsinvesting Rs. 10000 in SIPs at the age of 25. He invests regularly till his age60. At 15% CAGR (Compounded Annnualised Growth Rate) he tends to get a whopping14.85 Crores.
His Brother Shyamstarts investing Rs. 10000 in SIPs at the age 30. He invests regularly till hisage 60. He gets a sum of Rs. 7 Crores at 15% CAGR.
What are you waitingfor… Start Now!
Rome was not built in a Day
If you are investingin Equity Mutual Funds with the concept of creating wealth, do it with a mind-setof building a house, growing a tree or raising a child. Give it time to proveitself.
You don’t expect yourchild to start performing the day e is born. You give time to him to grow upand take care of you in your old age. This (Investment) child of yours iscertainly going to take care of you in your future.
To build a house, youneed to have a plan, raw materials like Bricks, Sand & Cement. An engineermakes a plan and then you get it sanctioned. Then the labourers start buildingyour dream house. It’s a time taking process to possess a dream house. Sameapplies to Equity Mutual Funds.
Don't put all your eggs in one basket.
What is the risk whenyou put all your eggs in one basket.. If the basket falls.. all your egss breakresulting in a loss for you.
When it comes toMutual Fund investments, do not put all your investments in one asset class.Always have proper asset allocation amongst Equity n Debt. Equity as an assetclass will take care of the returns on your portfolio and Debt will provide itstability. Opt for both!
Slow and steady wins the race.
Everyone remembers thehare & the tortoise story from childhood.
Choose your schemeswisely. Invest in Consistent schemes. Do not look at the short term returns andchose a fund. Let your advisor recommend few in a particular category and takeyour call.
Do not panic when yourselected Mutual Funds are not performing well in short term. Give it time. HavePatience. If, at the time of investment, you believed in the fund manager andthe scheme, stick to it.
Save me from my friends.
You like watchingAction Hollywood Movies but your friend likes to watch Hindi Rom Coms. You getbored while watching a movie with him. Similarly he thinks your choice of movieis not worth his liking.
If a friend invests inan Equity Fund, he has done by proper risk assessment and due diligence. Histime Horizon may be different. His Return expectation would be different. DONOT Invest on hearsay. Just because your friend has recommended, it may not beprudent for you to invest based on his recommendation. Trust your FinancialAdvisor. He would suggest you Mutual Fund investments only after proper riskassessment and asset allocation.
Too many cooks spoil the broth.
Too many Advisors aregoing to confuse the hell out of you and your Investment portfolio will go fora toss. If need be, do not have more than 2 consultants. Giving business inobligation to your bankers, relative, relative’s relative, friend must be acomplete No No. Let a professional handle 2nd most important aspectof your life; Your health being the first.
This, too, shall pass.
The volatility inEquity markets is permanent. Someday the markets will fall like nine pins andsometimes they will rise like a phoenix. Do not panic. The dullness / euphoriawill fade away. The reasons for every fall and rise in the markets will change.Stick to your Investment Philosophy and let your wealth Grow.
The writer, Kunal Jain, is director at Samriddhi InvestmentServices Private Limited. For any Mutual Funds related queries you may call himon ++919038110000 or write to him at kunal@samriddhigroup.com