DEEPAVALI (DIWALI) AND INVESTMENT



DEEPAVALI (DIWALI) is the most loved festival in India...
Young, Old and almost everyone looks forward to DEEPAVALI (DIWALI)
The young look forward to Crackers
The Old look forward to Spending Quality Time with Family
The Middle look forward to Sweets
Shoppers look forward to the OH! SO TEMPTING OFFERS from Companies and Online Websites
And almost everyone looks forward to THE GIFTS!!!!

Deepavali is a great time to have a serious look at your finances.
And, for me, personally, Deepavali has had a strong connection with INVESTMENTS coming from Equity Background (Muhurat trading, et al)



ADVANCE PLANNING :
Since Deepavali (Diwali) is a BIG BIG festival, lots of advance planning goes into celebrating the festival.....
Things like...what to buy, what to sell, what to clean...whom to invite....where to go....what food/sweets to prepare, what new to bring home...what old to dispose of....

Likewise...our Life Goals too need to be planned in advance.
Almost everyone does plan for BIG ones like Child Marriage, Education, etc but tend to ignore the smaller ones like the Annual Fees, Replacing the Car, Upgrading to a Bigger Tv, etc....
These small things play a huge role in denting or improving your Financial position and hence DEEPAVALI (DIWALI) would be a good time to start Planning in Advance for these goals and make your life better.

In Fact, PLANNED SPENDING plays a huge role in improving our Financial Position dramatically. 






CLEANING :
All Festivals, more so DEEPAVALI (DIWALI), start with Cleaning. All that “lets see later” things which we kept on Roof Tops and Corner of Room/Cupboard, come up for a Final Decision are either disposed off or kept in its proper place.

Likewise, every investment you do or have done should have a specific purpose and goal.
Maybe some are for Yearly School Fees,
Some are for buying Jewellery,
Some for Emergency,
Some for Buying Own House






There would be many investments which you would have bought due to pressure from your friendly neighbour LIC Agent or from your Bank Manager. They may be just for decoration purposes and not adding any value. 
You need to sit with your Financial Advisor and recheck whether the investment which you have continues to make sense and what role that investment has in your Life.



PROTECTION : 
DEEPAVALI (DIWALI) is a festival of lights but is also of Crackers, especially with those having Kids at home.
Kids love playing with Crackers and being young, they tend to be bit careless about protection and we, as Elders, always, ensure that they are adequately protected with sufficient amount of Water nearby and keeping an Eagle eye on their movements.



Likewise, our Family too needs protection. Of course, almost every family will have a Life Insurance Policy but is it sufficient?
Many people buy Insurance only to save Tax and not to Cover their Life adequately.
DEEPAVALI (DIWALI) is a good time to sit with your Insurance Advisor and check whether the Insurance you have is enough to take care of your family in case of your absence.
At the same time, it is better to play more safe by having adequate Health Insurance



EVERYTHING NEW
DEEPAVALI (DIWALI) marks NEW in many ways.
We buy NEW clothes, new appliances for our home, we even go to NEW places to enjoy.
Even NEW ways of Donation. Earlier we used to donate clothes but now its a trend to actually participate in some Social Seva including serving in Ashrams.
I truly appreciate this NEW thing.



Likewise, in Investment too, we need to be broadminded and be ready to accept NEW investment concepts.
Debt Mutual Funds is the NEW thing now...FDs are passe.
Gold Funds are the NEW thing now....Gold Chits are passe
SIPs are the NEW thing now.....RDs are passe

FINALLY,
BANISH DARKNESS:

DEEPAVALI festival is well known for lightning of Lamps and Diyas. This banishes the Darkenss.
Likewise....Banish the Financial Ignorance from your life...
Keep reading the Articles, Tweets and posts from SRIKANTH MATRUBAI and empower yourself.
Join the BEST Telegram Channel on Mutual fund run by Srikanth Matrubai called MF WORLD.
Whats more...its FREE to join.....
Join today...Join now   http:/http://https://t.me/MutualFundWORLD/

Incorporate these things this DEEPAVALI (DIWALI) and have a BRIGHT future ahead.
Let there be no EMI in your life.
Your Investment should have grown so much that you should be in a position to buy everything with YOUR OWN MONEY.
Its possible. Its just a matter of smart planning.
May Devi Lakshmi bestow all readers of PROFIT PLUS with Prosperity and Wealth






I had written the above in KANNADA orginally which is published in the latest issue of PROFIT PLUS magazine.
Its been appreciated by many and I look forward to comments and feedback from you, dear readers.



Have a great DEEPAVALI (DIWALI)



Regards,
Srikanth Matrubai,
CEO,
Srikavi Wealth
08041426247

Request all my Kannada readers to consider subscribing to the magazine PROFIT PLUS....it sure will be  very beneficial. I have attached the Subscription details

Also visit http:/http://https://t.me/MutualFundWORLD/

STORY OF MR.BELIEVABLE AND MR.UNBELIEVABLE

I normally almost always Analogies to connect with my Audience.....be it my Investors or fellow Advisors.
This particular Analogy was CREATED by me and used to present the benefits of Investing in Equities in a very simplistic way.
I had used this when I was doing a seminar for Teenagers.


THE STORY :

Once upon a time, in a city there lived 2 friends.
They were strangely named MR.BELIEVABLE and his friend was named MR.UNBELIEVABLE.

One day, Mr.UNBELIEVABLE felt very sick and he understood he was dying.
He called his wife and said
“Look Dear, I am dying and I am sick of this idiotic name UNBELIEVABLE. On my graveyard, do not write any name. You can put any image, a saying, or write anything say a poem, phrase, anything but not my name. I do not want to carry this idiotic name to the graveyard”
Very soon, he died.
His wife, as per his last wish, did not write his name on the graveyard but did write something which meant the same as his name.....MR.UNBELIEVABLE.

She wrote
“Here lies a man who became very wealthy by

a) Investing in Fds

b) Taking only Endowment Plans

100. Doing Day Trading in Stock Markets”

Whoever passed by the grave and saw the wordings exclaimed “its UNBELIEVABLE!!!!!”

So, this way, Mr.Unbelievable wish was fulfilled

Likewise, his friend MR.BELIEVABLE too became very sick one day and he too understood that he was dying.
He called his wife and said
“Dear, I am dying and I am sick of this idiotic name BELIEVABLE.
On my Gravestone, please do not write any name.
You can any image, a saying or write anything....a poem, a phrase, anything but not my name on the graveyard. .
I DO NOT want to carry this idiotic name to the graveyard”

Very soon, Mr.BELIEVABLE also died. 

His wife, as per his last wish, did not write his name on the graveyard but did write something which mean the same as his name.....BELIEVABLE

She wrote...

“Here lies a man who became very WEALTHY by

a) Investing in Equity Mutual Funds

b) Taking only Term Insurance

100. Most importantly, having SRIKANTH MATRUBAI (SRIKAVI WEALTH) as his advisor!!!!”

Whoever passed by the grave and saw the wordings could not but exclaim “its BELIEVABLE”

So, this way, Mr.BELIEVABLE 's last wish was fulfilled.

This, my friends, is the story of Mr.BELIEVABLE and MR.UNBELlEVABLE.

Regards,

Srikanth Matrubai

https://soundcloud.com/srikanth-matrubai/story-of-mr-unbelievable-mr

Also visit http:/http://https://t.me/MutualFundWORLD/

WHY MR.MAHAVEER SRISRIMAL IS MY BEST CUSTOMER

I was asked to name MY BEST CUSTOMER by a Platform recently and I could think of none other than MAHAVEER SRISRIMAL.

Why MAHAVEER SRISRIMAL?
He doesnt have the Highest AUM
He doesnt have the Highest SIP
Then why him??

Let me show you why only him and not anyone else.....


THE BACKGROUND FIRST..

The Heart issue in March sealed the fact that I had to take it easy in life from now on. 

So I not only decided to move to a new bigger office but close down the existing 2 small offices.
I had to stop running around too

The only itch was I was very new to a SETTING UP OF A OFFICE…

I mean…the Carpenter, the Painter, the Electrician but I knew I had to take the plunge. It was a case of NOW OR NEVER

So after 3 months of thorough search…I zeroed on a location and decided to move there. 

The office was a OPEN HALL and I had to set it up in a scratch.

The search for the good electrician, carpenter, painter, was the biggest pain.

I just couldn’t zero in on the right persons.

FINDING A RIGHT PERSON TO SET UP A NEW OFFICE IS AS TOUGH AS FINDING A GOOD FINANCIAL ADVISOR!!!

I had almost decided that I would have to compromise either on price or quality, when one of my oldest investor MAHAVEER SRISRIMAL came as a messiah.

He came to know about me setting up of new office and dropped in to have a look.

As soon as he came to know about the issue troubling me….he volunteered to STAND FOR ME AND LOOK AFTER THE SETTING UP OF THE OFFICE.

Now....not only he took active interest in the design of the Office, but he made sure that the Carpenter, the Painter, the Electrician, the Cable Guy & every one else were selected based on fulfilling all parameters like Price, Quality, Experience, etc

And, as an icing on the cake, he even selected the design of the Chairs, the Colours of Paint, etc

Another thing which was bothered me was the NEW office was the distance from my residence.
It would take half an hour one way amid chaotic traffic and I had to compromise on my business too.

But, yet again, I was saved from this work as Mahaveer ensured that I could concentrate 100% on my business and MAHAVEER SRISRIMAL would come to the NEW office to keep an eye on the Work being done at least 3 times a day.
He would call me every time he came....sent me Whatsapp image and even videos to keep me updated.

In fact, I was so FREE that I even went ahead going to MFRT conference in New Delhi as I knew that MAHAVEER SRISRIMAL is there to ensure that my office is coming up exactly as I want.

Its rare to find a TRUE FRIEND.
Its rarer to find an INVESTOR / CLIENT who becomes a TRUE FRIEND and even more than that.  

He kept a Eagles eye on the work in progress in my new office

Every change in office he would send me a photograph and  video and asked me for my opinion on that

It was as if another SRIKANTH MATRUBAI was looking after the NEW OFFICE.

When I moved in, I felt like moving into a PLUG AND PLAY Office!!

WHY HE HELPED ME??
This question is pretty natural.
Let me put things straight.
About 10-11 years back, when I first met MAHAVEER (he was not my friend...but my brother's friend) & I discovered that he had virtually ZERO investment and no future goals.
We used to meet regularly for a cup of coffee at the SLV HOTEL, in Chickpet and over the steaming hot cup of coffee, I explained to him the benefits of

1. Having a Plan for future
2. Planning for his children's eduction
3. Planning for his children's wedding
4. Planning for his own retirement.                    He was bowled over by the simplicity of what I explained and started with a small of Rs.1000 a month gradually scaling up to more than 25,000 per month

Cut to  present2 of hi, s children's marriage is over and he did have to take outa SINGLE RUPEE from his business.
EVERYTHING WAS FUNDED BY HIS INVESTMENT IN MUTUAL FUNDS.

For this 3^rd child's marriage also, the amount is READY!!!

To show the gratitude, MAHAVEER felt this is the best way and I would vouch this is  INDEED the BEST WAY.

I helped him in PEACE OF MIND for his kids marriage

He helped me in PEACE OF MIND for my office.
For me, his help was bigger!!

And finally, I would say I AM MORE IN GRATITUDE towards him ….simply because of the Mental, Physical trauma I was going through.

Thank you MAHAVEER SRISRIMAL.
Will be ever indebted to you and proud to have you as my Investor and most importantly as my FRIEND now. 

You, MAHAVEER SRISRIMAL are not amongst my Top 10 Investors in terms of Either Lumpsum or SIP. 

But, you are amongst the TOPMOST Investor in terms of GRATITUDE that I have.

YOUR BEST CUSTOMER IS

NOT THE ONE WHO GIVESYOU SALE or REVENUE??

THE BEST CUSTOMER IS THE ONE WHO HAS GIVEN YOU PEACE OF MIND.

YOU, MAHAVEER SRISRIMAL HAVE SHOWN YOU HAVE A HUGE HEART & EMPHATY

I WOULD PROUDLY SAY YOU, MAHAVEER SRISRIMAL, IS MY BEST INVESTOR AND I AM PROUD TO BE YOUR FINANCIAL ADVISOR.

WHAT BETTER DOES A FINANCIAL ADVISOR THAN A INVESTOR LIKE MAHAVEER SRISRIMAL. 

Regards,

Srikanth Matrubai

Also visit http:/http://https://t.me/MutualFundWORLD/

CORRECTION IS TEMPORARY, GROWTH IS PERMANENT

We are in similar position to what we were in 2013!!!
yes....By the looks of it....we sure are.
But are we??
Maybe yes.....Maybe no

If one studies the market level between 2014 and 2017, and look at both the ABSOLUTE returns as well as as the CAGR, at the index level...........then, we discover that SMALL CAP INDEX has delivered 30% CAGR.....YES!!! You read it right.....it is 30% indeed

Many fund have delivered even more than 30% in the Mid Cap Space itself

Many who saw the 2013 levels and selected the Large Cap funds to “PLAY SAFE” got sub-optimal returns than those who were BULLISH on the Mid and Small Cap space.

DATA IS TO INTEREPRET AND UNDERSTAND …..AND TAKE ACTION TO MAXIMISE WEALTH

Personally feel that the next 4 years will be go either the same way or infact much higher as far equity returns are concerned.

As usual, Mid and Small Cap Lovers will make tons of money.

TREAT EQUITY LIKE YOU TREAT LAND AND GOLD

The biggest issue with Indian Investors that when

1. GOLD prices fall, their first reaction is....GOOD.....Now I can buy more
2. 
   
3. When Land Prices fall, their reaction is ….CHALEGA....I AM HOLDING FOR LONG TERM

But when the same investors's mutual fund or equities fall, their reaction is....

IS THE END OF STOCK MARKETS....
Has my money gone??
Let me Take out whatever is left!!

When anyone is looking at selling off Real Estate and the land rates have fallen by 30%, their ONLY reaction is.....”WHY SHOULD I SELL NOW?? ITS DOWN BY 30%....i WILL WAIT”
but, the same investor, will not even blink when it comes to selling Equities even at a loss!!

DO NOT ALLOW YOUR NOTIONAL LOSS TO TURN INTO PERMANENT LOSS!!

History has proven to us that Gold and Real Estate take many many recover from a Bearish run and History has also proven to us that Equities take very little time to not only recover but also deliver superior returns than these 2 asset classes.

Even today, more than 130 LAKH CRORE money is SLEEPING in FIXED DEPOSITS which clearly shows that Indian investors do not understand the DEVIL OF INFLATION and still prefer the “assumed” SAFE investment....that is FD.

If Inflation is considered, then FD has generated NEGATIVE returns.

REMEMBER THIS....
When we are investing in Stock Markets...either directly or through the Mutual Fund route, the simple fact is we are INVESTING IN A BUSINESS.
Business is FOREVER and always has its ups and down.

No business, will do well all the time.

During Tough periods, either they reinvent or re engineer for the next stage. Business people WILL NEVER QUIT due to the downturn in their business and prepared to ride the volatility.

31^st January 2018 is the date which every investor will be looking at almost always.....as that is the day that Long Term Capital Gain Tax is applicable from.

Yes....your portfolio would have come down about 10% to even maybe 15% from that date.

But, this has happened many times before and Markets have bounced back with a vengeance every time.

And this kind of falls will again happen in future too. Its inevitable.

THE 2008 FALL!!!
EVERYONE TAKES ABOUT THE 2008 FALL

Many keep asking me....."is this the repeat of 2008 Fall"??

THE SENSEX FELL FROM 20873 ON 8TH JANUARY ALL THE WAY DOWN TO 8160 ON 9TH MARCH 2009

…..

..

…

BUT, IT ROARED BACK TO 21,000 BY 5TH NOVEMBER 2010.
It was down by almost 61% but ROARED BY BAY 157%
The Bounce Back is sharper and BIGGER each time!!!

Nothing is permanent in Life. The Markets have their own minds and keep going through these phases of volatility.

And sadly, many investors (especially,, actually STOP their SIP during these falls. Absolute Foolishness!!!
SIP is exactly designed to create Wealth from these kind of falls.

In fact, if possible, YOU SHOULD ACTUALLY INVEST LUMPSUM OR INCREASE when these kind of falls happen.

These are Opportunities to be used. SIPs are actually more Beneficial in a Downward Market than in a Upward Market!!

Stopping SIP and worse, Redeeming at this point of time will only convert your temporary Notional Loss into a PERMANENT REAL LOSS!!

In investing as in auto racing, you don't have to win every lap to win the race, but YOU ABSOLUTELY DO HAVE TO FINISH THE RACE. 

You, my dear investors, belong to that RARE AND UNIQUE 5% of the Indian Population who believe in the Power of Equity and the India's Growth Story and most importantly, you understand that the MUTUAL FUND route is the BEST way to achieve all your LONG TERM FINANCIAL GOALS.

Now, it sure is a TESTING TIME and yes, it sure is a difficult to digest to see portfolio value coming down almost on a daily basis

As your Well Wisher, I can assure that this too is a passing phase and the Equity Returns will bounce back and bounce back with a vengeance.

As your Well Wisher, I keep a close eye on your portfolio and will keep you posted on all updates as usual. 

YOU CAN BE 100% SURE THAT YOU ARE IN SAFE HANDS.

And, just like GOLD and Real Estate, your Equity Mutual Fund investment too needs to be nurtured for LONG TERM.

Nobody likes to see their portfolio going DOWN but its essential to remember that these are NOTIONAL LOSS.  But Creating Wealth requires patience and only those who pass this test will get rewarded and rewarded handsomely!!

Patience is not the ability to wait but the ability to keep CALM WHILE WAITING!!

AND FINALLLY, 

Face the Right Direction, and Keep Walking

“If we are facing in the right direction, all we have to do is keep on walking,” goes a Buddhist proverb.

So, when the Direction is right....in this case...our Direction is Wealth Creation and our vehicle also right...that is the EQUITY MUTUAL FUNDS...then there is absolutely no need to keep looking at the NAV on a daily or even a Weekly basis.

Sometimes it makes great sense to be like an Ostrich and ignore the noise all around.
I will be like a SWAN and ensure that you invest only in the RIGHT funds.....Funds that suit your profile and horizon.

1. Dont watch your NAV/Portfolio Daily

2. Dont listen to CNBC/ETNOW experts. They find pleasure in making you nervous. 

3. Take the Advise of a Good MFD/Advisor who will guide you after looking at your Goals.

4. If the Horizon is Long term, treat the Falls as an Opportunity to buy Quality Funds at lower rates and reduce your overall Cost of Purchase.  

All the very Best,
Regards, 

Srikanth MatrubaiCEO, SRIKAVI WEALTHWealth Architects

Also read

http://www.goodfundsadvisor.in/2017/08/learnings-from-sudden-fall-in-markets.html

http://www.goodfundsadvisor.in/2018/07/markets-at-all-time-high-but-my-mutual.html

http://www.goodfundsadvisor.in/2018/07/read-and-understand-this-before.html

 #goodfundadvisor
#srikanthmatrubai
#goodfundsadvisor

Also visit http:/http://https://t.me/MutualFundWORLD/

WHY SHOULD I SAVE MONEY?

Well Wishers, 

My 1st attempt at writing in KANNADA was successful due to your wishes. 

The same was published in the magazine PROFIT PLUS

Lots of non-Kannada people wanted a translation and here it goes. 

Hope you like the article. 

Ask any financial planner, the first thing he tells you is INCOME minus Savings should be your SPENDING

 Which obviously means the focus on SAVING

The question comes WHY SHOULD WE SAVE MONEY?
Why?
Let me enjoy LIFE now....who knows what’s in the future?
That’s exactly my point.
No one knows what lies ahead in the future.
You may lose your job, your income....the income/salary may not be enough, and many such reasons.

Let’s find each one by one

1. INFLATION

The Bigger reason is the SILENT KILLER called Inflation. The value of our money keeps decreasing day by day. The Rs.100 you had last year is not worth the same today. Ex: Fruits, Vegetables, Clothes which were available at a certain price is definitely not as same as last year and has increased.

A kilo of Apple, for example, which was Rs.100 last year, is now Rs.110 which means the price has gone by 10% and your income if it hasn’t grown that much will mean that you are becoming poorer and poorer slowly. Hence you NEED TO SAVE MONEY

http://www.goodfundsadvisor.in/2018/05/beware-of-lifestyle-inflation.html

http:/http://https://t.me/MutualFundWORLD/

2. EMERGENCY BACK UP

There could be a situation where in you may lose your job and may not find a similar salary paying job immediately. It may take anywhere between 1 month to 3 months to get a job and during this interval, you cannot ignore your Food, Gas Bill, Rent and HAVE to pay. An Emergency Backup will help you cope with such a situation and hence YOU NEED TO SAVE MONEY.

http://www.goodfundsadvisor.in/2017/05/why-liquid-funds-when-to-use-them.html

3. BUYING A CAR/ A DREAM HOME

Everyone dreams of a BETTER LIFE. To upgrade your vehicle from an Activa to a Car or to move from your Rented House to Your OWN House...you NEED TO SAVE MONEY

https://www.goodfundsadvisor.in/2016/11/read-this-before-buying-car.html

https://www.goodfundsadvisor.in/2015/10/do-you-really-need-own-car.html

4. MARRIAGE & KIDS EDUCATION

A marriage in the house requires HUGE Money and so does the Education (especially Higher Education) which can create HUGE HOLE in your Wealth.
Many families consider celebrating a GRAND Marriage as a PRESTIGE ISSUE and do not shy away from taking a Loan.
To avoid taking LOAN (or at least take a lesser loan) YOU NEED TO SAVE MONEY

 

5. RETIREMENT

Post retirement, you cannot depend on PENSION money (and if you are in a Private Company even this is not available) and most importantly the EXPENSES will not stop.
Pension Amount, if any, will not grow as fast as Inflation ultimately leaving you at the mercy of your children. 

Expenses does not become ZERO once you retire....It will get reduced for sure but expenses will be there and unavoidably, it will only GROW. To provide for these expenses YOU NEED TO SAVE MONEY’

6. HEALTH

During times of Medical emergencies, a HEALTH INSURANCE would of great help but not all diseases are covered by Health Insurance policy and small diseases like a Fever need to be supported by your money. 
And, God Forbid, if for some reason, your Health Insurance Company rejects your claim, your entire LifeTime Savings could go for a toss. 
Its always better to have a Health Insurance, an Emergency Fund and of course, SAVE MONEY!!

And of course, to have a GOOD LIFE and most importantly, HAVING PEACE OF MIND!!

Thus, dear readers, it is inevitable for you to SAVE MONEY to continue enjoying life long after your salary stops coming.

 

Request all my Kannada readers to consider subscribing to the magazine PROFIT PLUS....it should be very beneficial. I have attached the Subscription details

Also visit http:/http://https://t.me/MutualFundWORLD/

MARKETS AT ALL TIME HIGH BUT MY MUTUAL FUND NAVs IS DOWN!!

Whenever there is a sustained FALL in Markets...almost all Advisors start getting calls/mails from their investors.
Thankfully, due to constant mentoring and education, the regular sharing and mentoring is to ehlp my investors face periods of negative returns. 
99% of my investors understand the POWER OF COMPOUNDING is via LONG TERM and Volatility is a part and parcel of the Investment Cycle

However, some 1% of my investors (almost all NEW, who recently started investment through me) start showing their FEARs and ask for my guidance.

Here is one of my NEWER investors who started investing less than a year back and obviously needs lot of HAND-HOLDING.
He sent a screenshot of his investment and expressed his concern at the FALL.
Natural reaction and very understandable.

Here is my reply to him

Dear Investor,

I completely understand your concern on the fall in your Portfolio.
Nobody likes to see their portfolio going DOWN but its essential to remember that these are NOTIONAL LOSS. 

Though I keep communicating over Whatsapp, Facebook, Twitter, Email...still there this input is to instill more confidence about the Wealth Creation via Equity Mutual Funds

Face the Right Direction, and Keep Walking

“If we are facing in the right direction, all we have to do is keep on walking,” goes a Buddhist proverb.

So, when the Direction is right....in this case...our Direction is Wealth Creation and our vehicle also right...that is the EQUITY MUTUAL FUNDS...then there is absolutely no need to keep looking at the NAV on a daily or even a Weekly basis.

Sometimes it makes great sense to be like an Ostrich and ignore the noise all around.
I will be like a SWAN and ensure that you invest only in the RIGHT funds.....Funds that suit your profile and horizon.

The October 2017 circular which required grouping their Schemes under Specified Categories like Large Cap, Mid Cap, etc based on Market cap of the underlying stocks called the CATEGORISATION & RATIONALISATION OF MUTUAL FUND SCHEMES took the wind out of Midcap/Small Cap Rally.

Not just that...it resulted in a near CARNAGE as Fund after Fund dumped all their non-Large Cap holdings and increasing their exposure to Large Caps

Of course, the SEBI circular only acted as a trigger for the sell off as almost the entire Midcap and Small Cap space was extremely overvalued.

So....boom....the Large Cap Funds went UP

So....it is clearly evident with these numbers
FROM JAN 2018 TO JULY 2018...

Sensex UP by 10%

Large Cap Index UP by 6%

Mid Cap Index DOWN by 11%

Small Cap Index DOWN by 14%

 

Even in Sensex/Nifty, the Rise has been restricted to largely only 5 stocks. It has been that CONCENTRATED! 

When the variation is so drastic....there WILL be variation in your Funds and the Sensex

Your fund will not be mirroring the Sensex ...right??

Our Funds are neither in Sensex or Nifty!! Nor do our funds any significant stocks which make up the Sensex/Nifty and its neither a surprise nor a shock that your Mutual Fund NAV is down and down quite significantly.

The Sensex had a BIG RALLY from 3000 levels to 21000 levels between 2003-2007. However, the rise was not at all linear.

The Sensex fell more than 10% for 13 times in this period and out of which 1 time it was a 23% fall and another time it was a 29% fall.

Just imagine if you had WITHDRAWAN your money from the Markets when these fall happened.
You would have missed the 700% RISE for panicking after a 10% fall!

These falls of 10% are an opportunity to invest rather than getting panicky. And, you as an Accumulator for funds should actually be HAPPY if the NAV is coming down.

BUT WHAT IF THIS BECOMES A REPEAT OF 2008 FALL?

Very valid question and quite understandable.  NO one has the answer for this.

In the last 10&half years, the market has moved UP by only 77% compared to the 700% rise in the 2003-2007 Bull Run. My interaction with Fellow Advisors, Fund Managers and my experience says that the 2008 Fall WILL NEVER get repeated as at that time the Markets had rallied ABNORMALLY.

Still, if it happens, Markets would have reached Bubble stage and could be easily identifiable and I will definitely GUIDE AND HELP you to protect your Wealth.  RELAX!!

And, of course people talk about 2008 fall of 52% plus but no one talks about the BOUNCE BACK OF 81% the following year in 2009!!!

SO, WHAT SHOULD I DO NOW?

The Midcap Fall and the Small Cap Fall does not mean that these companies are selling lesser number of Soaps, lesser number of Clothes.
Focussing on Businesses instead of Stock Prices and NAVs is a good thing, especially in Bearish Times. 

Focus on the BIGGER PICTURE....Your Goals. 

When Situations Change, nobody knows how to respond. Thankfully, being in Equities for the last 27 years has helped me understand how to respond to this type of situation exactly as this happened many number of times in my professional career.  

STOPPING Your SIPs at this point of time would nothing short of a Disaster. It will hamper your Wealth Creation Hugely.

Yes....I AM BAISED towards SIPs. But there is no other EFFECTIVE method of investing in Equity Markets which has the capability to deliver you ABOVE AVERAGE RETURNS.

And, my dear friend, SIPs are actually more BENEFICIAL IN A DOWNWARD MARKET than in a Upward Market.

Stopping Sip and worse, REDEEMING at this point of time will only convert temporary Notional Loss into a PERMANENT REAL LOSS! 

Firstly, understand why you had invested in the particular fund.....
Does it still make sense to continue?

Has my Asset Allocation altered?
Have my goals been reasonably provided for?
Are my goals still far off?

The change is a fundamental change to the fund but not to your GOALS.
If your goals are still far away...it still makes sense to continue to stay invested (and in fact, add more) Small Cap and Mid Caps.

The History has proved time and again that Midcaps and Small Caps have given GREATER returns than Large Caps.

The volatility will only increase in the NAVs from here on.
But, you need to think LONG TERM and worry least about the fluctuations.

These fluctuations and falls of 10% plus are actually a great time to INCREASE your Equity Exposure if your Goals and Asset Allocation allows you to.

As your well-wisher, I would ensure that you stay the course and get out of this Temporary Blip without you suffering a stroke and create REAL WEALTH.

If your goals are quite far...CONTINUE to STAY INVESTED.
If your finances allow, do SIP TOP-UP and even consider investing a One Time Lumpsum.

And, finally, at the cost of repeating, let me reiterate....
1.       Fluctuations are inevitable and is a part and parcel of Equities as with any other Business2.       Equities is NOT for Short Term. Never Was. Never will be3.       Positive Growth is a Given. Equities have outperformed all other Asset Classes by a Reasonable Margin consistently. The only problem is the accompanying FLUCTUATIONS. You have to Bear with it.
4.       Constantly looking at your NAVs on a daily/weekly basis will not make the NAVs go Up but your BP will definitely go UP for sure.....Avoid looking at the same on a day to day basis5.       Stick to Asset Allocation. Stick to Good Quality Funds. Invest with a Goal in Mind and in Funds which align to your Goal.
6.       Dont listen to CNBC/ET NOW experts. It will only make you nervous.
7.       Treat the Falls as an Opportunities to buy more units of Good Quality Funds at Lower Rates and reduce your Overall Cost of Purchase8.       Continue to have a Advisor who will Hand Hold till you reach your Goal.

9. No Pain No Gain is definitely true for Wealth Creation, especially Equities. 

10. Falls are an Opportunity. Profit from it. In fact, you should pray for the Markets to fall if your Goals are far. 

   Equity is not to get rich fast. It is just that equity compounds wealth at a higher rate than other assets. Be ready to get rich slowly.

Also go through some of my previous articles on this Fluctuation Subject which I have dealt with
https://www.goodfundsadvisor.in/search?q=fall
https://www.goodfundsadvisor.in/search?q=fall

http:/http://https://www.goodfundsadvisor.in/search?q=fall/

Video on PITFALLS OF SIP SHORTAGE https://bit.ly/2vn6Ll3 https://www.youtube.com/watch?v=wXkbkID12UI http:/http://https://https://https://www.youtube.com/watch?v=wXkbkID12UI/

 

Best of luck,

Srikanth Matrubai

SriKavi Wealth

Also visit http:/http://https://t.me/MutualFundWORLD/