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Volume - 20 Issue - 7 November 2018

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R. N. I. No. : MAHENG / 2000 / 1238 Postal Regd. No.:PCW/027/2018 - 2020Posted at "Market Yard PSO, Pune - 411037 Date of Publication & Posting 06.11.2018

Everyone would like to live life peacefully. One has to decide whether to depend on someone

or live without compromising your life style.

The important goal of retirement planning is to have a secure and financially independent

retired life. That is why it is advised to put your best efforts now and save more for the future.

Retirement savings is one of the toughest and most vital things you should do in your working

years, as you will have to save your children's education, children's marriage, home loans

and all other everyday costs.

Plan your retirement blockbuster picture

Your Future Cost of Living

Assumed inflation

at 7%

Wealth Creation Assuming 12% CAGR

Your Yearly Income After Retirement

Withdrawal @ 6% p.a. Assuming Life Expectancy 80 Years

Current Age Retirement Age

25 60 19,48,581 38,97,161 77,94,323 97,42,904 1,16,91,484 1,94,85,807 3,89,71,614 30 60 10,58,974 21,17,948 42,35,897 52,94,871 63,53,845 1,05,89,741 2,11,79,483 35 60 5,69,291 11,38,581 22,77,162 28,46,453 34,15,743 56,92,905 1,13,85,811 40 60 2,99,744 5,99,489 11,98,978 14,98,722 17,98,466 29,97,444 59,94,888 45 60 1,51,373 3,02,746 6,05,491 7,56,864 9,08,237 15,13,728 30,27,456 50 60 69,702 1,39,403 2,78,807 3,48,509 4,18,210 6,97,017 13,94,034 51 60 58,446 1,16,893 2,33,786 2,92,232 3,50,679 5,84,465 11,68,929 52 60 48,458 96,916 1,93,832 2,42,290 2,90,748 4,84,580 9,69,159 53 60 39,594 79,187 1,58,375 1,97,968 2,37,562 3,95,937 7,91,874 54 60 31,727 63,454 1,26,908 1,58,636 1,90,363 3,17,271 6,34,542 55 60 24,746 49,492 98,984 1,23,730 1,48,475 2,47,459 4,94,918

Monthly Investment 5000 10000 20000 25000 30000 50000 100000

Current Age Investment Years

25 35 3,24,76,345 6,49,52,691 12,99,05,381 16,23,81,727 19,48,58,072 32,47,63,453 64,95,26,907

30 30 1,76,49,569 3,52,99,138 7,05,98,275 8,82,47,844 10,58,97,413 17,64,95,689 35,29,91,377

35 25 94,88,175 1,89,76,351 3,79,52,702 4,74,40,877 5,69,29,053 9,48,81,755 18,97,63,509

40 20 49,95,740 99,91,479 1,99,82,958 2,49,78,698 2,99,74,438 4,99,57,396 99,914,792

45 15 25,22,880 50,45,760 1,00,91,520 1,26,14,400 1,51,37,280 2,52,28,800 50,457,600

50 10 11,61,695 23,23,391 46,46,782 58,08,477 69,70,172 1,16,16,954 23,233,908

51 9 9,74,108 19,48,215 38,96,430 48,70,538 58,44,645 97,41,075 1,94,82,151

52 8 8,07,633 16,15,266 32,30,531 40,38,164 48,45,797 80,76,328 1,61,52,657

53 7 6,59,895 13,19,790 26,39,580 32,99,475 39,59,370 65,98,950 1,31,97,900

54 6 5,28,785 10,57,570 21,15,141 26,43,926 31,72,711 52,87,852 1,05,75,703 55 5 4,12,432 8,24,864 16,49,727 20,62,159 24,74,591 41,24,318 82,48,637

Current Yearly Expenses 240000 300000 600000

Current Age Year to Retirement Expected Yearly Expenses at Retirement

30 30 18,26,940 22,83,676 45,67,353

35 25 13,02,583 16,28,229 32,56,459

40 20 9,28,724 11,60,905 23,21,810

45 15 6,62,167 8,27,709 16,55,418

50 10 4,72,116 5,90,145 11,80,290

51 9 4,41,230 5,51,537 11,03,075

52 8 4,12,364 5,15,455 10,30,911

53 7 3,85,387 4,81,734 9,63,468

54 6 3,60,175 4,50,219 9,00,438

55 5 3,36,612 4,20,765 8,41,531

Picture Abhi BaakiHai Mere Dost

Mutua Fund investment are subject to market risks, read all scheme related documents carefully.

November 2018 (2)

With global markets high, the geo-political climate

uncertain, and Indian markets in a spate of correction, the

times ahead seem interesting. The question most investors

are asking themselves is, “How do I protect my investments

in these uncertain times?” This article hopes to share

information on not only how to protect one's hard earned

assets but also about how make money in these uncertain

times.

First, let us answer the question — what is volatility? It is the

uncertainty that accompanies the outcome of investing in

non-assured products. In simple words, every time you

know that there is uncertainty with the outcome of a

decision, there is volatility associated with it. The retail

investor maybe already familiar with this concept, albeit

intuitively. When hewatches a Business TV channel that

shows the price of a stock moving sharply moving up and

down in a short period of time, then the investor is viewing

the volatility of the stock in question.

Traditionally, most investors in India have been risk-averse,

choosing to stay in asset classes which offer relative safety

such as gold and have steered away from asset classes that

are viewed as risky. However, this may be leading to lower

gains over the long term for them, and is the product of an

inadequately researched investment methodology. A well-

diversified portfolio with a long time horizon of investment

will not be affected by short term volatility, but will surely

appreciate over time. Here are a few strategies one should

consider:

Diversification. If you forget everything in this article,

remember this one word, you might be thanking us a few

years down the road. Try to buy different asset classes. This

means that if an investor owns 4-5 stocks/Funds in a

particular sector only in India, then he will have exposure to

a variety of sector specific risks. But, if the investor owns a

few stocks in different equity sectors across India, his risk

decreases.

Befriending Volatility and that is the reason why one should look at equities as a

long-term investment. However Indians investors tend to

look at equities as a short term investment.

But, a retail investor would find it difficult to undertake

research on a company. A typical research of a company

involves creating future assessment of the company's

prospects through earnings models based on various

assumptions, viz

the growth prospects of the economy,

of the sector that the company belongs to and that of the company,

growth in expenses and consequent growth in profitability.

That's where mutual funds come to the rescue. The retail

investor can get an exposure to a portfolio with even small

sums of money, instead of investing directly. One also needs

to remember that Mutual Funds are really collective pass

through investment vehicles and hence they would do as

well as the market. All that the Mutual Funds can produce is

an alpha on the underlying market. So if the underlying

market is negative (i.e. say the NIFTY or the SENSEX is

negative) then the mutual funds would also be negative.

We must understand that the volatility of equity markets can

also be partially overcome. This can be done by investing

regularly in the equities mutual funds through the

Systematic Investment Plan (SIP) route. Essentially when

one is buying into a portfolio through say a mutual fund, it's

better that one considers investing at various price points in

the market and the SIPs does achieve that objective.

In closing, successful investing requires will to save a

substantial sum; a long term investment plan; the diligence

to stick to, and modulate the plan according to times; to

invest across the asset classes; and to utilize the help of

professional and competent financial advisors. Therefore, it

helps to reassert that a disciplined and systematic approach

to investment will go a long way in fulfilling the aspirations of

life. Happy Investing.

Further, if Ramesh owns, other assets such as bonds and

cash equivalents, he can reduce his exposure even further.

Couple all of these with owning stocks in other countries as

well and this will make sure that regardless of temporary

market fluctuations, in the long term Ramesh will see

returns.

Long-term. If you find yourself saying a prayer every time

you look at the ticker tape, this is especially relevant. Short-

term trading is tremendously risky, attracts unnecessary

taxes.By thinking in the long-term, one avoids the temporary

risks in the market. If we are to view the returns on broad

indices over a long time horizon, we see that all investors are

rewarded for their patience.

Discipline. Sachin Tendulkar didn't make a century in one

ball, he had to play many defensive shots before hitting the

sixes. Having a Systematic Investment Plan (SIP) can help

an investor build discipline. This will allow him to forgo the

risks associated with timing the market and understand that

all corrections in the stock market are accompanied by

rallies. Plus, it benefits from Rupee cost averaging which

helps benefit from the volatility associated with the markets

Simple. Drinking chai at a tea stall may taste better than an

expensive coffee at a café. An investor doesn't need to

invest in leveraged strategies, derivatives and other

complex financial instruments to save enough money for his

future. Having a clear idea of one's risk profile and sound

knowledge of the companies that the investor chooses to

invest in can save him time and bring him money in the long

run.

Volatility may come and go. But, if you keep these tips in

mind, volatility won't be the tyrant who doesn't allow you to

sleep, but rather the friend who helps your stock gain value!The point is that one must look at equities as process of

actually buying a part ownership of the business,

Today the world across is talking a lot about women's

empowerment, gender equality and ways and means to

overcome challenges faced by them. The woman on their part

too have stood strong and made hugely successful strides

towards empowerment and excellence in various fields, from

fighting for the right to education, sanitation and many more.

The rise of Indian women can be seen in the field of sports as

well, be it cricket, badminton, tennis or totally male sports like

wrestling or boxing.

In the field of business, there are innumerable women who

have contributed significantly like ace bankers Arundhati

Bhattacharya (SBI), Chanda Kochhar (ICICI Bank), Shikha

Sharma (Axis Bank) and executives like - Kiran Mazumdar

Shaw (Biocon), Indra Nooyi (PepsiCo), ShobhanaBhartia

(Hindustan Times Group) or AshuSuyash (Crisil) among

many others. This list will be incomplete without the mention of

our stars in sports who have made this nation proud, despite

all odds like SainaNehwal, PV Sindhu, Mary Kom, Mithali Raj,

Sania Mirza and Geeta Phogat.

Traditionally, men have always been regarded as the 'head' of

the family, but when it comes to actual management of the

house –it's the women who steer the wheel– as they are the

ones who plan the monthly budget, manage day-to-day

expenses, look after kids while also taking care of daily chores

and are also able to secure small sums as savings for a rainy

day.

Women are natural investment decision makersBut can women also excel when it comes to investments? Is

the activity too 'complex' for them to participate actively? Is the

answer different for working women as compared to home

makers?

“There is no chance for the welfare of the world unless the

condition of women is improved, it is not possible for a bird to

fly on only one wing.” - Swami Vivekananda.

According to a survey conducted by Nielsen, a global

research agency, in the year 2016, a healthy 52% of the

working women took their own investment decisions. The

encouraging part was that, the ratio jumped from mere 37% in

2013 to 52% in just three years.

So as seen in the survey result, globally more and more

women are now taking investment decisions independently.

Attributes, which are the basic principles of being a successful

investor, are easily associated with the characteristics of

women.

Disciplined approach – Generally, women are instinctively

more disciplined than men as they tend to do right things at the

right time taking care of all finer details as well. When it comes

to investments, Systematic Investment Planning (SIP) is akin

to disciplined approach, wherein an investor invests a fixed

sum in schemes of mutual funds at regular intervals.

Patience – Taking care of children, handling various relatives

& friends, balancing work and family life and more such tasks

require endless patience. So, you know who has more

patience… For investing you need to be patient and remain

invested for long-term that could help to see your investments

translate into actual wealth.

Conservative Approach – According to Ameriprise 2013

survey, only 26% of women respondents stated that they

prefer “high risk and high return” when compared with 33%

male respondents. This means, women tend to avoid

unnecessary risks.

To safeguard your investments from volatility and cut down

the risk factor you need to be conservative and should

diversify your investments accordingly. Remember the age-

old adage – 'Don't put all your eggs in one basket’

Budget Planning – As mentioned earlier, man may be

regarded as the 'head' of the family, but in general it's the

woman, who not only participates actively, but steers the

wheel too. Knowing how much to invest is as important as

knowing where to invest, hence budgeting is one of the key

aspect of a successful investment plan. You should always

plan your budget keeping in mind both short-term and long-

term goals, never underestimating or overshooting them.

One can always argue that, running a house/family and

taking investment decisions are worlds apart, but the

characteristics required are inarguably the same and are in-

built in women.

Investment guru – Warren Buffet's investment style is said

to be feminine by co-author LouAnn Lofton in his book -

'Warren Buffet Invests Like A Girl – And why you should,

too'. The author emphasizes that Buffet's style of

investment basically highlights a calm, cautious, patient and

long-term (approach)… which in general are considered to

be the personality trait of women.

Given the fact that woman possesses such natural traits

which are said to be a perfect recipe to be a successful

investor, I wonder what stops her from taking her own

investment decisions? I firmly believe that 'She' should

actively participate in investment decision making. She has

the right natural talent and knowledge about concepts and

products that are now widely available. I would say to her –

Come on! You can do it! Take the financial baton in your

hand… and run.(Source SBI Mutual Fund)

(Source Kotak Mutual Fund)

Mutua Fund investment are subject to market risks, read all scheme related documents carefully.

November 2018 (3)

Liquid Mutual Funds = Stable returns + high liquidity + low risk

About 95% of Indian households prefer to deposit their money in savings bank account while

less than 10% choose to invest in mutual funds or stocks according to the latest Securities

and Exchange Board of India (SEBI) investor survey. Assured returns and instant liquidity

attract investors to bank accounts. While they can keep a portion of their money in savings

accounts based on their comfort level, they can consider investing in liquid funds which also

offer quick liquidity with stable returns

What are Liquid Mutual Funds?

Liquid fund is a open ended mutual fund scheme whose investment universe comprises

certificates of deposit (CDs), commercial papers (CPs) and government treasury bills (T-bills)

with maturities of up to 91 days. Maturity is mostly lower than that. The prime objective of

these funds is to seek optimal returns while maintaining safety and high liquidity.

Other key features

Liquidity in a day's notice and no entry & exit loads - Instant liquidity associated with savings

bank account lures investors. Liquid funds also offer instant redemption. However, capital

market regulator Sebi has put a limit of Rs 50,000 or 90% of folio value, whichever is lower, on such redemptions. Prior to the new regulation, investors had to wait for a

day to get their redemption money. For instance, the cut-off time on withdrawal from a liquid fund is generally 2 p.m. on business days. So, if an investor places a

redemption request by 2 p.m. on a business day, funds will be credited to his/her bank account normally on the next business day by 10 a.m. Further, most liquid funds

have no entry and exit loads which brings additional relief to investors.

Least risky among all debt funds – Liquid funds are not risk-free but are least risky among all debt funds as they invest in money market instruments with very low

maturity. Liquid funds reduce the risk by investing in high rated papers, thus building a safety net. An analysis of CRISIL ranked liquid funds showed these funds, on

average, held 79% of their portfolio in top rated money market instruments (A1+) in the year ended March 31, 2017. Before investing, investors should do due diligence

about the portfolio attributes.

Liquid funds vs traditional investment avenues such as savings account

Better yielding – In spite of deregulation of interest rates by the Reserve Bank of India (RBI) in 2011, most banks offer 4% on savings deposits. Though some banks offer

higher interest rates, they require higher minimum deposit amount. In comparison, liquid funds offer relatively higher returns. Liquid funds, exemplified by CRISIL –

AMFI Liquid Fund Performance Index, returned 7.26% in the one year ended April 30, 2017 (average one-year daily rolling returns). These funds have scored over

savings account in terms of both rolling one-year returns and point-to-point returns.

Suitability

Liquid funds are ideal for investors with a low risk-bearing capacity and short-term investment horizon. However, investors should note that returns of liquid funds are

linked to the prevailing money market yield and they do not guarantee

“It’s not your salary that makes you rich, it’s your

spending habits.” - Charles A Jaffe – American chess

master.

If I must sum the money cycle for most of the people in 3

words then it would be Earn, Spend and Save. Think

about it. You already have spends planned even before

that salary is credited to your account. How would

things look if you could change the cycle to Earn, Save

and Spend.

It will not be easy!

But how about inculcating a regular disciplined

approach towards savings and investing. It needs a

small step to work towards building future. To achieve

any goal in life, one needs to be disciplined and patient.

It is applicable for achieving your financial goals as well.

Its time to make this Salary Day - SIP DayWhat if you can automate this disciplined habit? How

easy it would be if you don’t have to push yourself to

save and invest. What if a fixed sum of money is

automatically deducted from your account when the

salary is credited?

Life would be a lot simpler then!

This is where Systematic Investment Plans (SIPs)

steps in. They are one of the simplest and easiest

mode of investments. One can invest a pre-

determined sum of money at regular intervals (can

be monthly, quarterly, etc.) for a specified period

keeping in mind the goal to be achieved.

Investing through SIP is taking the first step towards

potential wealth creation. The second important step

is to ensure that you are regular with your SIP

commitments. Through SIPs you can invest your

savings whether small or big and allow it to grow. As

the money is invested regularly in mutual funds

schemes, you automatically develop a disciplined

investing habit.

SIPs involve making regular investments in the

mutual fund scheme of your choice.

Units of the mutual funds schemes are allotted

based on the amount invested, thereby allowing you

to ride through the ups and downs of the markets

with great ease. As the markets go up, you earn

fewer units and when there is a decline,

comparatively more units are allocated. As a result,

you continue making investments over a period

(regardless of the market situations), and timing the

market becomes unnecessary. Once you have

registered for a SIP, skipping or missing is not a risk

that you run.

And you could achieve all of this if you register for

SIP on the salary day!

Remember – tomorrow never comes – If you wish to

achieve something big in life, do it today – Now is the

time. You can overcome investment challenges by

setting your ‘Salary Day’ as your ‘SIP Day’. By doing

so, you will neither miss or skip your SIP investment

nor do you run the risk of having spent your money

even before you planned to save.

One of the biggest advantage is that you are

investing in yourself, investing for your future self

through SIPs!

(source: SBI Mutual Fund)

Mutua Fund investment are subject to market risks, read all scheme related documents carefully.

Mutua Fund investment are subject to market risks, read all scheme related documents carefully. (source: SBI Mutual Fund)

November 2018 (4)

Our BranchesOur Branches

Smart Investorsstay invested

at all times &

Avoid timing the markets with Systematic Investment Plan

MonthUnit Price

(`)Amount Invested

(`)Units

Purchased

Rising Markets

MonthUnit Price

(`)Amount Invested

(`)Units

Purchased

Falling Markets

Mutua Fund investment are subject to market risks, read all scheme related documents carefully.