Thursday, January 22, 2009

Student's investment query



-->Chet had a investment dilemma and queried :
hello sir,
myself chet and currently I have 25000/- rupees with me and i want to invest in SIP.

I am an engineering student and my age is 23. I also get a scholarship of 8000/- per month and will be continued up to may 2009 so the total amount will be upto 35000/- saving minusing the tuition fees and living expenses.


Currently i have got an RD of 1000Rs from post office.

Please sir suggest me which SIP i should go with and my plan is to invest 1000Rs per month or 1500/- and also suggest me the period of investment.


With Best Regards,
Chet

SRIKANTH SHANKAR MATRUBAI advised :
Dear Chet,
Even though you have age on your side, so I would advise you to go for Diversified Equity Funds, simply because Sector/Theme Funds tend to be volatile and you being a student, you may require money at a very short notice.
I advise you to Stop your 1000 RD in Post Office immediately, as these tend to give very low returns even eroding your investment value when you consider Inflation too. Unless this amount is for an Emergency, you should stop this RD immediately and switch the investment into Mutual Funds.
I suggest you to consider investing 1500 in 4 Funds as follows:
500 * 1 in DWS Tax Saving Fund (500) (You can avail Added Bonus of Free Life Insurance of 5 times your Investment)
500 * 1 in Fidelity Equity Fund (500)
250 * 2 in Reliance Growth Fund (500)
250 * 2 in Sundaram Select Focus Fund (500)
These Funds are low on Risk and Above Average on Returns and Should Serve you all.
Best of luck,
Srikanth Shankar Matrubai.
Also visit http://equityadvise.blogspot.com for an indepth Equity Analysis

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