Rediff.com« Back to articlePrint this article

Budget is over, what investors should do now?

July 08, 2009 18:01 IST

Are you always at a loss while planning your finances?

Are you aware of the investment options available in the market? How best can you plan your finances?

What are the crieria for evaluating an investment option?

Are mutual funds profitable investment options? When and how should one buy mutual funds?

In an hour-long chat on rediff.com on Wednesday financial planning expert Sailesh Multani offered some valuable tips. Here is the transcript:

Sailesh says, Hi, goodafternoon everyone, lets start the chat session.


ria asked, which is the best saving option amont MIS and NSC so that i can get cash for my monthly expenses during my retirement.?
Sailesh answers,  at 2009-07-08 12:29:50hi, for monthly income Post Office MIS is one of the option but there is a limit of Rs 9 lakhs. Besides MIS, you can consider options like FDs with monthly / quarterly income plan. For e.g. HDFC Ltd fixed deposit offers the monthly income plan
mike asked, Which is better for investment, gold fund or gold ETF? What percentage of portfolio one must have and for how long one should remain invested? Thank you for your advice.
Sailesh answers, hi, Gold ETF is better alternative to physical gold. There is a ease of investing as far as ETFs are concerned. Also there is no botheration regarding the safe keeping of physical gold. In my view you should have atleast 10% allocation to Gold. Ideally the investment in gold should be held forever.
Udayan asked, Hi, I need to understand I am 27 and I have a cash balance of arnd 10 lacs and anrd 10 in equity and MFs I have Booked a under construction flat of 50 lacs where i have to arrange the money in next 3 yrs in phased manner, I am currently earning and 11 lacs per anum. Please advice selling timing for selling stocks and getting loans.
Sailesh answers, hi, if the money to be paid for construction of house is currently invested in equities, then you should start the exit immediately. As and when you get good opportunity, I recommend that you exit. You have 3 years to go before the money is to be paid. 3 years should be long enough to help you exit equities completely
bharatbalani asked, Sir, i want to invest 50000 rs every month. Where should i invest for long term
Sailesh answers, hi, by long term if i assume 5 years and more then I would recommend that you consider investing major portion of your savings in equities. Equities are volatile but over the long term they can give you returns in the range of 12-15%
thirumalai asked, hi i am 33 years old i want to retire at age of 50, kindly advise which mutual funds i should invest to get retirement amount of 2 crores & 25 lakh for my son education, i am based in dubai.
Sailesh answers, hi, since your retirement is 17 years away, I would recommmend that you consider equity funds for your retirement plan. Ideally you should invest in well managed diversified equity funds with minimum track record of 3 years to show for. Also, when you make you plan aim for returns in the range of 12-15% from equity. IF you aim for higher returns, you will run the risk of missing the retirement age. Simialr strategy for your son's education
Manoj asked, Hello sir, I am a new invester.Need to invest.Starting with 50K,can you please suggest me wat will be good to invest?should i invest in share?or in MF.Please suggest. Thanks.
Sailesh answers, hi, since you are new to the world of investments, I suggest that you take help of an honest and competent investment advisor. Get an investment plan made for your various life goals like retirement, education, marriage, property, etc. The plan will suggest how much investment should be done in equity/debt/gold etc. In my view MFs are the best way to build your investment portfolio.
rajrishi asked, Is retirement plans a good option or mediclaim is?
Sailesh answers, hi, retirement plan will take care of your post retirement expenses. These will include your day to expenditure and major expenditure like travel etc. Regualr medical expenses can be take care of by the retirement fund. To insure against any major medical cost like hospitalisation, etc medicalim is the best route.
Atul asked, i have 50000 now to invest, shd i invest in this market?
Sailesh answers, hi, if you are looking at investing in equities from long term perspective then you should go ahead and invest. For investors with long term view of more than 5 years, short term trends of stock markets should not matter. Given the current scenarios stock markets look poised to give you returns of about 15% over the next 5 years.
vishalpai asked, Hello,How should one calculate how much insurance is enough?I am 27 with coverage of 40L in LIC through a money back policy.I have dependent parents.Should i go for more insurance?
Sailesh answers, hi, to know the amount of insurance cover one should take, you shlould calculate the Human Life Value. To calculate your human life value you can use the HLV calculator on www.personalfn.com by click the link:http://www.personalfn.com/calc/hlv.html
asdqq asked, plz suggest best ELSS fund for 3 yr horizon????
Sailesh answers, hi, you can consider funds like Franklin India Taxshield and Fidelity Tax Advantage Fund among others
vishalpai asked, Hi Good morning,What is the best option to invest now -plain vanilla funds,infrastructure/sectoral funds,bluechip funds?
Sailesh answers, hi, I am of the view that investors should always invest in well managed diversified equity funds. Sector/Thematic funds should be avoided as the performance of these type of funds is dependent upon the performance of the underlying sectors. The entry and exit from the sector has to be timed well to benefit from invest in sectoral/thematic funds
MMM asked, i want to invest in balance fund. Which are top 3 in above category?
Sailesh answers, hi, among the balanced funds you can consider funds like HDFC Prudence and DSP BR Balanced Fund
sethi asked, invested sip rs4000 in hdfc top 200 , rs 200 sip in hdfc equity. i have incureed heay losses by investing in funds like tata indoglobal , jm agri infra , ing fof , reliance diversified , icici pru infra and now want toknow what should i do
Sailesh answers, hi, you have invested in secotral/ thematic funds. These funds ofder high risk high return proposition. In my view you should exit these schemes and invest in diversified equity funds like the ones you currently hold - HDFC Top 200, HDFC Equity
deepak23460 asked, Sir,I want to secure future of my child. he is 01 yr. I would like to invest 25000/- should i invest it in MF or ULIP or Shares..
Sailesh answers, hi, in my view build a portfolio of mutual funds for your child. Consider having 4-5 best mutual funds schemes. I will not recommend ULIP as an investment option.
sanjay19 asked, should a new investor use this correction in equities to invest now?
Sailesh answers, hi, if you are long term investor then the current fall in the stock markets should be considered as an opportunity to invest. The short term trend should not deter you from investing in equity as long as the long term trend is upward which it currently is.
UPENDRA asked, WHAT IS BEST INVESTMENT ROUTE FOR LONG TERM (10-15 YEARS).
Sailesh answers, hi, the best investment option for 10-15 years would equities. Even property will be a good option but then for property the initial investment amount required will be comparatively large.
gireesh_27 asked, Hi Sailesh, I am a Doctor and working in Gulf earling nicely, but it will not long last, may by 2012 I will back to India, by that time I will have around 1 crore in my hand presently I am having 65 L with me, I am 32 yr old what are the options for investment for me, Thank you
Sailesh answers, hi, consider making an investment plan for yourself. The plan should help you achieve the various life goals you have set for yourself. Once you have the plan in place, it will be easy for you to determine the asset allocation and the investment instruments (mutual funds/ shares/FDs)
investforfuture asked, When Equity based Mutual funds also follow the direction of market, then why would one need to invest in mutual funds at all. We can as well directly invest in equities. Your thoughts ?
Sailesh answers, hi, to invest in stocks directly you need to research the company's performance and the future growth prpspects. The common investor may not have the necessary tools to analyse the company's financials. He may have to rely on his borker/friends. Mutual funds are managed by professional fund managers. They have the necessary skill sets and tools to understand the perofrmance of the company and its future prospects.
investforfuture asked, How much of one's portfolio should be in equity ?
Sailesh answers, hi, the thumb rule is that 100 minus one's age should be in equities. The logic behind this is that as you grow in age the risk taking ability goes down. As one progresses near retirement, more money should be allocated to safe instrument like fixed deposits etc. The thumb rule is just the starting point and may not always offer the best asset allocation mix. Also the investor's risk profile should be taken into consideration.
rrrrr asked, hi sailesh, iam investing 5000 rs every month in various mutual fund now 3rd year is going on but due to recession iam unable to pay this amount every month what to do? when can i withdraw this? and how much i will be benefited?
Sailesh answers, hi, if you are not able to continue with the SIPs then you can stop till your cash flow improves. However, as soon as you are in a position to invest again please do start. The benefit of SIP investment will be visible only after 5 years when you have invested through various market cycles.
Sanat asked, Hi Shailesh. I wanna invest Rs. 10K/month regularly for atleast next 48 months. Can you pls advice me suitable SIP(s)? Thanks in anticipation of your reply. Cheers!!
Sailesh answers, hi, consider funds like franklin india bluechip fund, hdfc equity fund and dsp br equity fund to start with.
dev1 asked, Hi Sailesh I m 30 and need to invest in a good Unit linked pension plan. Can you suggest which is the best plan to invest 5k/month as sip.
Sailesh answers, hi, in my view do not go for ULIP. ULIP combines investment and insurance . for investments you should build a portfolio of equity and balanced funds. For insurance the best option is to take a Term plan to cover the risk in case of any eventuality
gaurangpatel asked, hi, i want training regarding options....can u suggest any book or any person/institutions giving systematic knowledge of options regarding indian market.?
Sailesh answers, hi, you can attend trainining sessions conducted by Bombay Stock Exchange.
juhi asked, Hello Sir, When u say invest in equities for long term more than 5 years... do you think one should book profits at regular interval or keep on investing systematically without any withdrawals regardless of what is happening in stock market? Thanks in advance for clearing my confusion. Regards
Sailesh answers, hi, yes if your returns are way ahead of the expected returns then you should certainly book profits. For e.g. if your expected return from equities is 15% and your returns are say 30%, then you should book profit by taking the excess 15% of the table and invest in low risk instruments like FDs/ Gold
singhs asked, Hello Mr Sailesh, I tried asking you the same question while you were online last time, but could not get any answer. Hopefully this time... I am investing 40000 annually in the Money Plus Growth Scheme of LIC since 2007 which has a locking period of 3 years. What should i do? Keep investing or opt out after this years premium? Thanks in advance!
Sailesh answers, hi, you should invest for the mandatory period of 3 years. After the mandatory period is over you should stop paying further premiums
kshiv asked, Dear sir Invested in sbi contra,hdfc top 200,dsp 100 & reliance growth through sip.how do u see my portfolio in longterm?more than 5 yrs.thanks
Sailesh answers, hi, except for SBI Contra, all your funds are good. Continue you investments in the same.
einvestor asked, hi, what about investing in Quantaum FoF offer?
Sailesh answers, hi, its a good investment proposition given the fact that the investor does not have to build and manage his equity fund portfolio. The Quantum FoF will invest in equity funds of other mutual funds
riya asked, Hi......I am 32 now and have 10L savings till now out of which 6L are in FD's at 8.5% which will due in middle of 2010 and 3L in MIS which will due by 2009 dec and i have 1 L in equity whose value is 40k now. So what should i do with FD's and MIS , should i reinvest them or move some more amount in equities. thanks
Sailesh answers, hi, the answer to your question lies in determing the final need for the money which you have saved. In my view you should make an investment plan for yourself and then decide the asset allocation and investment options.
Sailesh says, hi, thank you all for participating in the chat session. If you have any further queries, please feel free to mail me at : info@personalfn.com