Sunday, February 27, 2011



Investing through SIP is advisable. Avoid LUMPSUM.

 Reliance has come out with a New Fund Offer, Reliance Gold Savings Fund.
Should you invest??. Let us check it out...

Reliance Gold Savings Fund is a Fund of Funds., meaning your money in this Fund will actually be invested in another fund, namely Reliance Gold Exchange Traded Fund. And, this Fund in turn invests in Gold.

An Exchange Traded Fund (ETF) cant be invested through Sip., and so is Reliance Gold ETF., and here's where Reliance Gold Savings Fund steps in.
You can invest as little as Rs.100 per month!!!

Positives :
No Demat Account.
Can invest as little as Rs.100 per month.
Long Term Capital Gains after holding period of 1 year compared to 3 years holding period in Physical Gold.
Very Liquid compared to Physical Gold.

Negatives :
Being a Fund of Funds, charges could be higher. Gold ETF charges 0.75% whereas Reliance Gold Savings Fund could charge upto 1.5%.
Equity has and will continue to outperform Gold in the Long Run.

While "experts" are shouting about Higher Expenses, one should not forget that the Expense is fixed at 1.5% by SEBI and moreover, your SIP investment would be working at Rupee Cost averaging and will actually help you gain more than Gold Returns. (Just like a equity sip would give you more returns than a Lumpsum investment).

Prudent Asset Allocation will tell you that you should have a 5-10% Gold exposure depending on your profile and based on this, you should decide how much you should invest in Reliance Gold Savings Fund (or whether you should invest at all).

People in India tend to invest in Gold not as an investment, but more for creating a corpus for their children's marriage, for them, this Fund is God send.
I would still stick my neck out and say that Equity is the Best Asset to Invest, especially if your Time frame is more than 5 years.

If you want to have a Gold Exposure, then investing through SIPs in Reliance Gold Savings Fund is the BEST way to do it.

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Saturday, February 26, 2011


 There is nothing new on offer in the NFO of IDFC Infrastructure Fund.

IDFC has surprisingly launched an Infrastructure fund when the entire sector is avoided like plague by Fund Managers and Investor alike.

Do the IDFC people found something that many have not been able to???
Well, only time will tell the answer.

But, their guts has to be appreciated to have bought out such a Theme Fund in these difficult times.

I met Mr.Kenneth Andrade recently and he explained, "Infrastructure stocks are valued attractively and Cash Flow visibility is very strong and Investors will flock to these very same stocks sooner rather than later. We want to be there earlier than others and give alpha returns to our investors".

Mr.Kenneth Andrade reasoned that the Infrastructure Stocks were over-hyped during the 2008 highs and and under-performing due to over skepticism and is overdoing by investors on both fronts.
He expects Infra stocks to bounce sharply and lead the Next rally, especially now that many of these infra projects are getting executed and should be monetized sooner.

Infrastructure Sector as a whole has been going tough times and the future does not look too bright with high inflation and hardening interest times.


A Sector Fund is a strict no-no, especially if you are investing in Lump-sum.
One bad policy decision, and lo, the entire sector looks down and out and you will be left holding a drowning boat.

And yes, there are more than a dozen infrastructure funds in the market today and there is no particular reason for you to pick this Fund over the others unless you have a leaning towards IDFC brand name or you love Mr.Kenneth Andrade.

However, to this Funds benefit, I must add here that Infrastructure Stocks constitute more than 50% of the Nifty, which makes this Fund more diversified than a pure play Theme/Sector Fund.


I would still say...

Go for Diversified Funds as there is nothing that prevents a Fund Manager in investing in Infrastructure sector if he finds the sector attractively valued.


By the way, I had this thought, that probably the AMC guys at IDFC thought they could piggyride on the IDFC Bond Ad wave which has been doing the rounds for more than 6 months now and would be easy to suck in gullible investors.

Maybe it also is that IDFC people are following the classic saying 'Buy when others are selling"!!  and launching Infra fund when other AMCs are wary of talking about their Infra funds performance.
Best of luck,
Srikanth Matrubai

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Monday, February 14, 2011


Srikanth Matrubai recently arranged a Investor Awareness Seminar at KSCA Chinnaswamy Stadium.

The Presentation was by Srikanth Matrubai and NJ South Zone Mr.Tushar Bhajantri.

The Meet was primarily targetted towards newcomers to the Investment World and was aimed to dispel myths regarding Mutual Fund Investment.

To begin with, Srikanth Matrubai spoke on the importance of saving and ensuring returns being above Inflation Rate at the Least.

He also emphasised the virtues of "Systematic Investment Plan" and extolled the investors to invest through SIP to 'SLEEP IN PEACE'.

He warned investors not to fall in the mode of 'INVEST AND FORGET".
Regular review of a Portfolio is a must, even if the Fund has a 5 star rating.

Click here…

Thereafter, Mr.Tushar took over and created a lasting impact with his interactive question and answer session. He emphasised that 'investors should have a Definite Goal and think only about Long Term".

To see the video click here…….

This was followed by an interactive session on mutual funds, insurance, savings and other avenues.

The Experts, besides Mr.Srikanth Matrubai and Mr.Tushar, included representatives from Birla Mutual Fund, DSP Black Rock Fund, Religare Mutual Fund, Axis Mutual fund, Escorts Mutual fund, HDFC Mutual Fund, L&T Mutual Fund, DWS Mutual fund, etc.

The Event was a grand success with a Full House of over 75 attendees.

In between, in his true witty style, Srikanth Matrubai held a Quiz contest on general investment matters like Inflation, etc  and "Prizes" were given to winners. 

After the meet, investors enjoyed the Dinner.

Video link…

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