BAD Equity SIP Returns VS FD Returns

Dear All,

This is an interesting read by ET Wealth. I think during such troubled times they're trying to educate investors to stick with their SIP's instead of stopping them and to have faith in the Equity Markets over the long term. 

I totally support this process and believe that investors should show a little more faith in the time frame and the performance of the fund manager. Although the short term / near term for the Equity Market looks to be terrible, over the long run your Systematic Investments will work out just fine. 

A 27% return CAGR over 10 years is pretty impressive where clearly Rs. 1.2lakh was returned as Rs. 12.79lakh. 

Our view at DENIP is that we anticipate at least a 10% - 15% fall in the indices (BSE Sensex & NSE Nifty) over the next 1 quarter. We believe that all long term investors should look to add a Gold SIP to their Equity SIP portfolio as a hedge to the oncoming fall since in the worst case inflation linked returns around 6% will  persists and during such turbulent times (2008 crisis, 2011 EU crisis) higher returns to the tune of 20%+  can be expected. Following is an email we had sent to a client on the 31^st of October 2011 who had started investing recently:

Scheme Name	Folio No.	Amount Invested	Current Value	No. of Units	Current NAV	Profit / Loss	P/L %
HDFC Top 200 Fund	7228258/61	15,000.00	14,099.14	73.953	190.650	(900.86)	-6%
Reliance Regular Savings Fund	404120184465	5,000.00	4,744.64	171.952	27.593	(255.36)	-5%
DSP Black Rock Top 100 Equity Fund	2496587/94	10,000.00	9,298.50	102.142	91.035	(701.50)	-7%
Kotak Gold Fund Growth	1913261/95	10,000.00	12,415.69	959.859	12.935	2,415.69	24%
	Total	40,000.00	40,557.97			557.97	1%

The whole portfolio was saved only because of investments in a Gold fund. If you work on proper asset allocation, the return game changes completely.

Do get in touch with us if you're interested. You can call us on (022)40156688/99 or 9320496699/9320196699.

Thanks,

Dewang K. Mehta

DENIP Consultants Pvt. Ltd.