mantras for investment

Mantrasfor

Investment

Ventura Securities Ltd.April 2016

Why do I need to do Investment

Planning?

I’m young and want to enjoy

my life!

I don’t have any spare money to invest or save!

I’m already investing in Bank FDs!

The ET WEALTH Retail Investors' and

Consumers' Survey 2015-16

The survey was carried out among 10,000 consumers and was spread across metropolitan cities, tier-2 and tier-3 towns.

Only 3% of the respondents says they can achieve all GOALs

What are these goals?

Phase I Phase II Phase III

Child’s Education

Child’s Marriage

EducationEarning Years Post Retirement Years

Age- 22 yrs Age- 60 yrs

Marriage

Child birth

Housing

22 yrs 38 yrs 15- 20 yrs

Non-Earning Years

Common Reasons

� Savings Vs. Investment

� Time Value of Money

� Investors ignore Real Return

� Inappropriate Investments� Inappropriate Investments

� Long term invest into Debt (PPF; FDs; Tax free bonds etc.)

� Short term invest into Equity

Savings Vs Investments

�Short-term goals

�Manages

�Long term goals

�Normally, for a

You decide

Savings Investment

�Manages

immediate

liquidity needs

�Earn small

amount of

money

�Normally, for a

longer duration

�Usually earn a

larger amount of

money

decide what is good for

you…

Time value of money

Impact of inflation on monthly expenses of Rs. 30,000 today

Decreasing Value of Rs. 100,000 over time

62,368

79,599

100,000

78,353

At inflation of 5%

30,000

38,288

62,368

Today 5 years 15 years 20 years

48,102

37,689

Today 5 years 15 years 20 years

Hence objective of any investment is to beat inflation

Investors ignore Real Return

Actual

Return –Tax

Applicable

Post Tax

Return

––InflationReal Return

Real Returns….

Date Bank FD^ PPF Gold Sensex

Nov-90

9.00% 9.00%

3200 1196

Mar-16 29,766 24,646

XIRR (%) 9.21% 12.69%

^Weighted average rate for last 25 years

**Weighted average inflation for the past 25 years

*Assuming the investor is in Rs.10 lacs and above tax slab who is taxed at 30.90%

XIRR (%) 9.21% 12.69%

Real Return (%) -1.78% 1.00% 0.26% 4.69%

Post Tax Returns 6.22% 9.00% 8.26% 12.69%

Inflation (%)** 8.00%

Today’s value of Rs. 1 lakh invested in different asset

classes 15 years back

10.00

12.00

14.00

Am

ou

nt

Rs.

Lak

hs

Performance of Asset Classes

13.59

8.14

3.64 4.180.00

2.00

4.00

6.00

8.00

10.00

Equity Gold Bank FD PPF

Am

ou

nt

Rs.

Lak

hs

Equity Gold Bank FD PPF

Select Proper Asset Class

� Define your goals between Short term & Long Term

Invest into Debt Instrument Invest into Equity Instrument

Million Dollar Question

Equity seems to be attractive… but I don’t have

much knowledge

Kaise invest karu?

Kaunseshares buy

karu?

much knowledge about it

Systematic Investment Plan

Benefits of SIP!!

1. Rupee Cost Averaging

2. Power of Compounding

3. Investment Convenience

4. Disciplined Savings

5. Flexibility

SIP Journey of Ramesh

� Ramesh is a 45 years old married man and has been investing Rs. 5000 per month in Equity Mutual Funds via SIP Mutual Funds via SIP since age 25 .

� Let’s take a look of his SIP Journey….

“Start Early” for the extra zero

“The Power of compounding is the Eighth wonder of the world”

- Albert Einstein

“Start Early” for the extra zero

At the Age 60

Ram’s Corpus

The Difference due to early

start of 5 years.

Investment Ram’s Corpus

Rs. 3,22,00,000

Shyam’s Corpus

Rs. 1,75,00,000

Rs.

1,47,00,000

Does that sound BIG enough?

Investment

Period

35 years

Investment

Period

30 years

Scheme Performance

SIP returns on monthly investment of Rs. 5,000/-

Tenure 5 Years 10 Years 20 Years

Investment amount (RS.) 300,000 600,000 1,200,000

Scheme Name

Present

value(Rs) XIRR(%)

Present

value(Rs) XIRR(%)

Present

value(Rs) XIRR(%)

Franklin India Prima Fund 529,085 23.60 1,509,574 17.81 20,622,702 24.17Franklin India Prima Fund 529,085 23.60 1,509,574 17.81 20,622,702 24.17

SBI Magnum Multiplier

Fund 453,500 17.07 1,213,947 13.70 9,233,046 17.99

Birla SL Advantage Fund 460,578 17.72 1,135,105 12.43 9,432,650 17.93

SBI Magnum Equity Fund 409,735 12.82 1,109,186 11.99 7,900,892 16.50

Reliance Growth Fund 409,724 12.82 1,097,148 11.78 20,444,586 24.10

Benchmark Index

NIFTY 50 356,993 7.12 885,062 7.66 4,511,563 11.91

Returns as on 7th April, 2016

Recap..

1. Set your Financial Goals.

2. Start Early.

3. Target Real Returns.

4. Do not ignore EQUITY as an asset class.4. Do not ignore EQUITY as an asset class.

5. Adopt disciplined way of SIP.

Thank you!Email: mfcustomercare@ventura1.com

Time is ticking and every second counts….START

INVESTING NOW….ITS NEVER TOO LATE !!