UNLOCK 1.0

Unlock 1.0. Here are things Investors should do

When you face with Fracture in your leg and after due treatment doctor advises you to live normal life as before!! Will you be careful and gradual in getting back to normalcy or just do everything you do otherwise, from next day?

You are likely to behave responsible!! You will gradually move to lead normal life which will take another 2 weeks for you to walk fast and may be a month more to run! Basically, here, doctor shifted responsibility of prudence on you!!

Same will be the case in UNLOCK 1.0 for you! Central has allowed many things to open and operate with final directives left to state and local administration. So now citizens are made to behave responsibly!! Government will not intervene in micro life management.

Before you start to live normal life, examine below:

1)      Has anything changed for good in last few days?

2)      Has Covid 19 cases reduced to zero?

3)      Are cases reducing in my locality and city?

4)      Have I got any Vaccine to save from Covid 19

5)      Is medicine being found?

6)      Has the infection rate and strength reduced?

7)      Hotels and restaurants will open, will you go?

8)      Religious places will open, will you go to worship?

9)      Malls will open, will you go shopping?

10)   Trains will ply, will you take travels or avoid as far as possible?

If answer to all the above is not Yes, you know what you must do!!

Unlock 1.0 is manifestation of the erstwhile Green and Orange zone concept. Administration wants citizens to use prudence and chart their daily life. Almost everything will be open but should you splurge will be your own decision!

Coming to Investing now. That’s what you look up to me for😊

Market may scale up in next week, cheering Unlock 1.0. Market will view it as light at the end of tunnel and will start factoring in end of Lockdown sooner or later.

My suggestion would be to stay on course with your investment. Do not jump into investing aggressively. Spread Investing across 5-6 month time frame. Do not worry if market goes up substantially. Market is yet to find many answers before it could take direction. In fact, I am of the opinion, if market goes up, I would rather ease my equity holding and build cash buffer to take opportunity/bottom fishing. I am sure market will present opportunities surely😊

Top 5 states with respect to number of cases are also economically important for our GDP growth. These top 5 states are Maharashtra, Tamil Nadu, Delhi, Gujarat and Rajasthan. UP is largest labour supplier state is at number 7 but likely to feature in top 5 very soon.  

Fundamentally, market will seek clarity on

1)      Exit of Lockdown. Opening of entire supply chain.

2)      3^rd Phase of infection and response to it.

3)      Ramping up number of tests

4)      Possibility of return of 2^nd wave of Covid 19. We will learn from global peers.

5)      Demand outlook of consumers

6)      Solvency of enterprises

7)      Job loss numbers and salaries

8)      Return of labour to industries.

9)      Global demand and economic outlook

10)   Geo political development.

11)   Possibilities of Global recession

Do connect with me if you wish to know, what is our investment strategy for you!!

If you find our blogs helpful, please do like, share and comment

Author –

Bhavesh D Damania

Founder & Chief Care Taker - Wealthcare Investments

EduPrenuer, TV show panellist and Blogger

You can reach him at 9833778887 and wealthcarein@gmail.com

"Risk comes until you know what, where and why you are Investing”

 

 

What should fully Invested person do Now?

3 things that fully invested person can do!!

Most of the investors who are fully invested, were found to be in 100% equity only. Very few fully invested people are in debt or Asset allocator funds etc. Our all clients have either Asset allocator funds, Arbitrage fund or Liquid fund in their portfolio. The allocation is ranging from 20-40%.

Today, I will talk about the 3 things that such investors (fully invested equity Investor) can do!!

1)      Review your portfolio – Equity market has bounced back quite a bit now. Quickly reach out to your advisor, Wealth Manager of Relationship manager (if he hasn’t reached out to you yet) and take action relevant to portfolio. It could be wise to generate some cash balance. Those who think, I am long term investor and market will revive sooner or later, may not be able to take advantage of current market. If your advisor, WM or RM hasn’t approached you yet, don’t hesitate to approach him. It’s your money and you need to be vigilant, he may not care as much as you care about your money😊.

2)      Prepare strategy to take advantage of the crisis- If your advisor is not reachable/capable to prepare strategy, you need to do it yourself (unfortunately though). You will have to make scenario analysis and the actions thereof. Example – What if market falls another 10%, What if market rises another 10%, how I should re-align my portfolio into Debt + Equity + Gold and further allocation to large/mid/Small in equity side and duration/credit risk etc. on debt side. If you don’t have plan in place, when markets will throw up challenge or opportunity, you will not be able to act decisively.

3)      Be systematic and committed- Coming 12-18 months are going to be testing time for Investors. You will not be able to exit the equity market due to its brighter outlook, and not be able to weather the volatility of the market. Many questions are to be answered and trends needs to be observed after world exits lockdown. What/ how and how much things will change are Guesstimation at the moment. So time will be trying and you got to be committed to the plan. If you leave half way, you will be at disadvantage.

I must also mention here that if you are not confident on your advisor/RM or WM and if you are not willing to stick to his/her plan, than adopt status quo!! Reason of saying this is, a seasoned hand is likely to do wonderful job and make good use of the once in decade opportunity. And if you are going to behave volatile, than the entire strategy may not be advantageous.

 

Do connect with me if you wish to know, what our investment strategy is for you!!

If you find our blogs helpful, please do like, share and comment

Author –

Bhavesh D Damania

Founder & Chief Care Taker - Wealthcare Investments

EduPrenuer, TV show panellist and Blogger

You can reach him at 9833778887 and wealthcarein@gmail.com

"Risk comes until you know what, where and why you are Investing”

 

 

 

Kya Mutual fund sahi hai?

Mutual Fund sahi nahi hai

Mutual fund sahi hai aur Investor shahid hai

I usually do not write ill about any other product but I am seeing attacks on the Mutual funds since the Franklin Templeton winding up of schemes. Suddenly the competition industry - Insurance (especially Zindagi ke baad wale) and Real Estate guys are trolling the Mutual Funds.

Social media flooded with Anti mutual fund campaign!! And surprisingly, even the informed and educated investors got either confused or convinced by these messages.

I thought to write today as since I am firm believer of Mutual fund as method of investing across the asset classes viz Equity, Debt, Gold and Property ( Yes Mutual funds have products with Gold and Real estate investments also). As a responsible player in the industry, it’s my duty to demystify some of the messages and hype around it and help educate the investor community at large. No offense meant to any industry, product or investor

I believe all products have to be part of the asset allocation of the Investor’s basket. What I have seen is Equity is the most under-invested asset class among 80 - 90% of Indians. Therefore I endeavour to drive equity cult among Indian investors. But I also behave responsibly when the valuations are not conducive. Since over 2yrs, I also mentioned that gold is likely to do well. My view on real estate was negative since long which also got vindicated. Our existing investors can vouch for my claims.

Let me share the basics of mutual fund today. It could be new for many and brush up for many!!

Mutual funds stands for

1) Simple

2) Transparent

3) Professionally managed

4) Tax efficient

5) Offers diversification

6) Can give better risk adjusted returns v/s benchmark

7) Offers liquidity

8) Highly regulated

9) Easy to manage and maintain

10) Track record of 25 years in India. Most preferred investment vehicle for Investors across the world

Whatever negative you have come across in past one month about the mutual funds, I would like you to evaluate the Mutual funds in light of below mentioned pertinent points.

1)      Transparency issue – No one can deny the fact that Mutual fund are tightly regulated (may be over regulated). Can anyone give example of full proof product/service or industry which has no grey area? In the Investment world, is there a product which is so transparent? Disclosure of portfolio, Valuation, Expenses, many disclosures and undertaking which investors are not even aware of!!

2)      Quite risky – Again can anyone tell me which investment doesn’t have risk involved? FDs, Property and Gold has no risk? Kindly also note that besides risk of return and or capital, risk are of different types. Example – Risk of capital not beating inflation in FDs, risk of title, ownership, litigation, encroachment in real estate/land etc. Risk of purity and genuineness in gold etc. 1)      In fact Mutual fund carries the disclaimer (which no one carries) "Mutual fund Investments are subject to market risk"

3)      Liquidity and or permanent loss – With winding up of 6 schemes (among thousands of mutual fund schemes) of Franklin Templeton, entire mutual fund industry cant be painted with the same brush!! This is one of event in the history of Mutual fund existence barring few schemes during subprime crisis!! Please consider, world is going thru a unique situation of lockdown thru out for nearly 2 months. Never in history, whole world was in lockdown and that too at the same time. You will see your buyer may not be paying you, your employees may not be paid, your salary may not be paid, you may lose your job. Many businesses will go bankrupt in times to come. In this context if part of your investments is locked in, is it really all that bad?? Not disregarding the anxiety and pain of investors. The endeavour is to give logical guidance.

4)      Less than FD returns in last 5 yrs – Since last 5 yrs, preserving asset (Debt and Gold) gave better returns and growth asset (Equity and Property) gave less return in comparison. Investor usually follows herd mentality and invests in product which has given great returns in past. Wise investors does SWOT analysis and look for opportunities. I would urge you to think, if equity has given lower returns for long period of time, what is the outlook of future? Equity is ownership in business! If you think business don’t bounce back or create wealth, than you will not agree with me. Couple it with fact that, world thinking of revival of growth at any cost, would mean what to equities?? Equity will revert to mean therefore, equity should deliver better returns, sooner than later. Vichaar kare.

5)      Agent, Wealth Managers, Bankers are mis-selling – Each and every industry will have element of mis-selling and/or have incapable operators. Some institution/outfits/agents will not put Investors interest before theirs. Some players are not contacting Investors or not taking their calls. Some players are not experienced/capable enough to gauge market trends etc. Bluntly speaking, Investors will have to do that hard work to find out experienced and trust worthy person who can manage Investments better. That’s the least investors can do to safeguard own interest.

Mutual funds have been giving benchmark beating returns since decades and will do it future also. World over, Mutual funds has proved to be preferred investment vehicle for HNIs, Middle class and retail investors.

In case you need to know more? Please feel free to speak to me on 9833778887 or write to me at wealthcarein@gmail.com. I will be happy to help you without obligation.

If you find our blogs helpful, please do like, share and comment

Author –

Bhavesh D Damania

Founder & Chief Care Taker - Wealthcare Investments

EduPrenuer, TV show panellist and Blogger

You can reach him at 9833778887 and wealthcarein@gmail.com

"Risk comes until you know what, where and why you are Investing”