Vishal Merchant, Partner C1 Advisors, IFA from Surat
Outlook for equities and debt market for 2012 – He feels that equity market may not correct as it has almost reached historically low valuation and the major concerns from inflation also look under control.
He is very optimistic about the Indian equity market at these levels also and believes that anyone who invest at these levels and holds for three years, will get above average return.
He sees a good opportunity in debt market too because if the interest rates start reducing, it will impact prices of bonds and long-term G-sec funds. “It is a good time to get into the debt market because if someone invests at these levels, he will surely get good returns if he holds the investment for two years.”
Broad Asset allocation – He maintains an 80 (equity) – 20 (debt) asset allocation. In the current volatile market, he has not made any changes to his portfolio. In fact, if given a chance to make any changes, he would increase his allocation to equity.
He describes himself as an aggressive investor who holds his equity investment minimum for 10 years, as all his investments are linked to his goal. He reviews his portfolio every six months in a stable market and quarterly in a volatile market. “I believe in investing through SIPs and have been doing it for long. I have never stopped my SIPs, no matter what the market conditions are. In fact, I have increased it whenever my cash flow increased,” says Vishal.
Do’s and Don’ts for investors:
Do
- Investors should focus on long term goals
- Investors should have SIP in their portfolio because SIPs will create tremendous amount of wealth over a period
- They should talk to the advisors and educate themselves;if they do so, they will never make impulsive decisions
Don’t
Surendra Kumar Bagaria, IFA from Kolkata
Outlook for equities and debt market for 2012 – He believes in not predicting anything about the equity market because he says that everyone is clueless about its movement. “It is very difficult to say which way the market will move. But we need to believe that just as the market has gone down, it will come up.”
He feels it is a good opportunity to invest in debt market to fulfil relatively short term goals.
Broad Asset allocation – He is a hardcore equity investor and parks 100 percent of his investment in this category in a bull run, but withdraws some cash during volatile market and puts into debt. He changes his strategy according to market movements but he follows his financial goals.
He is an aggressive investor and believes that only equity investment can give high returns provided they are held for a long period. “You should not panic when the market is low, because during a bull run the equity investments will give you tremendous returns. I constantly invest in equity and do not believe in timing the market to invest.”
Bagaria reviews his portfolio every month to note the performance of his investments.
Do’s and Don’ts for investors:
Do
- They should not go after products which promise huge returns in a short time
- Do not ignore inflation while planning for long term goals as it will result in erosion of capital
- Never ignore one goal in life – retirement planning
Surendra Kumar Bagaria, IFA from Kolkata
Outlook for equities and debt market for 2012 – He believes in not predicting anything about the equity market because he says that everyone is clueless about its movement. “It is very difficult to say which way the market will move. But we need to believe that just as the market has gone down, it will come up.”
He feels it is a good opportunity to invest in debt market to fulfil relatively short term goals.
Broad Asset allocation – He is a hardcore equity investor and parks 100 percent of his investment in this category in a bull run, but withdraws some cash during volatile market and puts into debt. He changes his strategy according to market movements but he follows his financial goals.
He is an aggressive investor and believes that only equity investment can give high returns provided they are held for a long period. “You should not panic when the market is low, because during a bull run the equity investments will give you tremendous returns. I constantly invest in equity and do not believe in timing the market to invest.”
Bagaria reviews his portfolio every month to note the performance of his investments.
Do’s and Don’ts for investors:
Do
- Continue your investments according to your financial goals
- Invest through SIP and increase its percentage whenever you have disposable income
Don’t
Rajaraman Kumbeswaran – IFA from Chennai
Outlook for equities and debt market for 2012 – He feels that the Indian markets will remain volatile as we are dependent on FII investment. “Our economy is dependent on foreign investments, therefore we need to wait and watch how the global markets move.”
Short term debt funds will perform as they did last year. Interest rates won’t be going down soon, he feels; therefore he sees a good opportunity lying in this segment for the next six months.
Broad Asset allocation – He usually allocates his assets in equity (60percent) and debt, gold (40 percent). He believes that people should have debt class in their portfolio because it helps them to earn regular income.
He has a moderate risk appetite because of his age but he reviews his portfolio once in six months. He has continued all his investments in this volatile situation.“This is a golden opportunity, so I have continued my investments and even made fresh investments in the last three months.”
Changes in your strategy in the current situation – “I am a global investor; I am shifting my money from developed countries to developing countries. Besides that I haven’t made any other changes.”
Do’s and Don’ts for investors:
Do’s
- Do not try to time the market
- Don’t be sentimental in taking investment decisions, be logical
Rajaraman Kumbeswaran – IFA from Chennai
Outlook for equities and debt market for 2012 – He feels that the Indian markets will remain volatile as we are dependent on FII investment. “Our economy is dependent on foreign investments, therefore we need to wait and watch how the global markets move.”
Short term debt funds will perform as they did last year. Interest rates won’t be going down soon, he feels; therefore he sees a good opportunity lying in this segment for the next six months.
Broad Asset allocation – He usually allocates his assets in equity (60percent) and debt, gold (40 percent). He believes that people should have debt class in their portfolio because it helps them to earn regular income.
He has a moderate risk appetite because of his age but he reviews his portfolio once in six months. He has continued all his investments in this volatile situation.“This is a golden opportunity, so I have continued my investments and even made fresh investments in the last three months.”
Changes in your strategy in the current situation – “I am a global investor; I am shifting my money from developed countries to developing countries. Besides that I haven’t made any other changes.”
Do’s and Don’ts for investors:
Do’s
- You should divide your financial goals into two categories – short term and long term
- For short term investments, park your money in fixed deposits, bonds and debt market; for long term, you should go with equity and real-estate; If you are not too comfortable with equity, use SIP as your weapon to enter the market
- You need to believe in equity market because there is no other product which can beat inflation and give you returns
Don’ts
Outlook for equities and debt market for 2012 – As far as debt market is concerned, interest rates are expected to come down as there is a good probability that inflation rates will move southwards.
In terms of equities, he feels it is a buy year and investing with a five year horizon is a very good bet.
Broad Asset Allocation – His investments are based on his financial goals. If they are long term in nature, he invests in equity. He makes changes in his strategy if there are changes in goal, income and expenses. “I don't make amendments in my strategy based on short term market conditions.”
He is a systematic investor and invests in a disciplined manner for goals above five years. For short term goals, he sticks to pure debt products. Mukund invests regularly irrespective of market movements. He says, “I believe every time is a good time. It is not timing the market but the time in the market which matters.”
When asked about his risk appetite, he says, “I fear when others are greedy, and greedy when others fear.”
Do’s and Don’ts for investors:
Do's
Thanks,
Gaurav Agarwal
Head Dealer
DENIP Consultants Pvt Ltd
- Don’t put all your money in equity because you should have some spare cash to invest in the market when it is low
Outlook for equities and debt market for 2012 – As far as debt market is concerned, interest rates are expected to come down as there is a good probability that inflation rates will move southwards.
In terms of equities, he feels it is a buy year and investing with a five year horizon is a very good bet.
Broad Asset Allocation – His investments are based on his financial goals. If they are long term in nature, he invests in equity. He makes changes in his strategy if there are changes in goal, income and expenses. “I don't make amendments in my strategy based on short term market conditions.”
He is a systematic investor and invests in a disciplined manner for goals above five years. For short term goals, he sticks to pure debt products. Mukund invests regularly irrespective of market movements. He says, “I believe every time is a good time. It is not timing the market but the time in the market which matters.”
When asked about his risk appetite, he says, “I fear when others are greedy, and greedy when others fear.”
Do’s and Don’ts for investors:
Do's
- Involve family in financial planning – The entire family together needs to work towards their financial goal, it’s a team effort
- Be clear about your goals – Returns is not the sole reason for investing;what people need to know is what has to be done with those returns
- Do avoid loans as much as possible – the debt trap is the worst kind of trap one can fall into;EMIs may end up being very burdensome. So it’s important that one does a good amount of savings before and pays off existing loans using a fixed return debt instrument so that he is loan free and can manage finances better
- Don’t time the market – investments have to be continuous
- Don’t save for tax benefit alone – investments done with the sole purpose of getting tax benefits cannot help achieve goals;exemptions and tax benefits are designed keeping the advantages of the country at large and not you in specific
Thanks,
Gaurav Agarwal
Head Dealer
DENIP Consultants Pvt Ltd
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