Mutual Funds Portfolio
Quarterly update: April 17th 2020
This space shall be updated every quarter with performance of mutual funds & suggestions. Follow on Twitter to get regular updates on issues of Economics & Investing.
This space shall be updated every quarter with performance of mutual funds & suggestions. Follow on Twitter to get regular updates on issues of Economics & Investing.
Portfolio Performance Review
Here is a review of the mutual funds we track & their performance updates. Pls invest according to your chosen strategy from the investment portfolio advice pack. Our suggested funds are marked in bold letters. At any time, pls don't invest in more than 2 to 3 funds under each category (a) Large cap funds (b) Multi cap funds, ELSS funds (c) Mid cap, Small cap & value funds & (d) Debt funds / Bank FDs / PPF. Restrict yourself to 2 funds per category for a portfolio below Rs 2 crores. Restrict total count to 8 funds at the maximum. Debt funds can be replaced by bank deposits or PPF. In view of the recent debt funds crisis, best is to stay away from debt funds & just prefer Bank FDs or PPF.
Benchmark Indices Performance
SIP Trends & Other Indicators
SIP inflows stayed steady at Rs 8200 plus crore levels which is helping the markets retain critical levels. Also indicates that retail investors are finally able to understand the importance of staying invested in the thick & thin or markets.
The overall equity MF flows are clearly unstable as bulk investors try to time the markets driven by short term pessimism or euphoria. This almost never ends well as we see from high inflows in early 2018.
Another promising sign is the high inflows in mid & small cap funds. These were under pressure since 2018 & represented value for those who have the appetite for long term wealth creation.
Final Thoughts
Are you worried about the slowdown ? You should not. More so when you are on SIP mode. This is the time when a SIP pays off. I would like to draw you attention to the following points:
- As you see in historical returns, every year is not a lottery. 2014 & 2017 have shown that equity behaves in a non linear fashion. Since market discounts the future today, the expectation get priced in fairly quickly. Post 2017, we were expecting to see a few dull years, more so as the earnings growth has still not picked up. But this is where you get your money's worth. You buy cheaper units in funds.
- Key sectors on Indian economy have hit an air pocket. And this was true even before the Covid-19 pandamic hit us. The virus makes it even worse in the short run. With financial services & autos in a slowdown, or so it appears, there may be some downward pressure. Again, this is not something that people knew & we are still discovering the depth of it. But few earlier warnings from my side were very clear about the heating up of certain stocks.
- However, there are some positives that give hope. There is a new government at the center that has returned with a stronger mandate. So bold decisions are expected & are happenning along the way. There is an underlying theme that this government follows. It likes to manage distractions & also controls the government machinery better than its predecessors. Now this may seem like a bad press to some but is largely good for the economy. Our country is full of contradictions & if we don’t have powerful center, it may not be good for the economy.
- Additionally the inflation is under control on a sustainable basis & that works for the economy in the long run. There is a RBI that is much more responsive & alert to the moving trends. This always works well for all major economies. Rupee may devalue as FII money flows out but that should not impact Indian investors.
- If you have some bulk money to spare, invest in bulk now in the large cap or multi-cap funds for long term gains. You'll be glad you took this decision, few years down the line.