Systematic Investment Plan - 280408

8/8/2019 Systematic Investment Plan - 280408

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Have you savedenough for a

rainy day?


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Presentation points

What are savings?

Have you saved enough for a rainy day?

A Smarter Way to Save

Inflation The Silent Assassin Principal Systematic Investment Plan (PSIP)

Advantages of PSIP

Any Day SIP from Principal

How to make PSIP work for you?

PSIP in our schemes


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What are savings?

Saving is what we retain from our income after all the expenditureshave been taken care of

Savings = Income Expenses

Expenses more often than not are never ending and comes out of

money set aside for monthly savings

This acts as a vicious cycle forcing one to play catch-up with thetargeted savings amount


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Have you saved enough for a rainy day?

Requirement Period to Expense

Annual Holiday Every 1 2 years

Own a Car (Capital Asset) After 2 3 years

Own a House (Capital Asset) After 5 years

Childs Education After 15 20 years

Childs Marriage After 25 years

Retirement Corpus After 30 years (Recurring)

Contingency (Illness, Accidents) Recurring

The list is endless!!


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ASmarterWay to Save

Rearrange the priorities by putting savings before expenditure

Save at the beginning of the month and spend out of whatremains

A change in equation

From

Savings = Income Expenses

To

Expenses = Income Savings


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Inflation The Silent Assassin

Inflation silently eats into our savings

Most people discount the effect of inflation while

planning for future needs

To put things in perspective lets assume an average

inflation of 6.5 % for the next 30 years


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Understanding Inflation

Rs 10,000 today will be worth.

Rs 7,299 in 5 years

Rs 5,327 in 10 years




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Tips forSmart Investing

Disciplined Investing Invest regularly and systematically

Invest in Instruments that beat Inflation

Start Investing as early as possible


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Welcome to the World ofSystematic Investing

Presenting

Principal Systematic Investment Plan (PSIP)


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What is a Systematic Investment Plan (SIP)?

Invest Rs 2000 on the 10th of every month in a Principal equity

scheme

Units are allocated as per the NAV on that date

Invest a fixed amount

Every month

at the NAV on a specified date


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Advantages of investing using PSIP

Easy to understand and operate Simply fill up an application formalong with an Auto Debit Form (ECS) / Cheques and attach PAN proof

Allows investments of small amounts - Invest as low as Rs 500 every

month

Instills investment discipline Forced saving and investments aremade in all market scenarios

Also

Rupee Cost Averaging (Buy less when markets are up / Less when

markets are up)

Power of Compounding (Your investments compound along with the

returns over the years)

Convenient to build a corpus for future requirements


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Rupee Cost Averaging

Investor As SIPInvestment Investor Bs Lumpsum Investment

Month NAV Amount (Rs) Units Amount (Rs) Units

April 1 10.50 3000285.71 36000 3428.57

May 1 10.65 3000 281.69

June 1 10.05 3000 298.50

July 1 9.75 3000 307.69

August 1 9.60 3000 312.50

September 1 9.50 3000 315.79

October 1 9.25 3000 324.32

November 1 9.05 3000 331.49

December 1 8.90 3000 337.08

January 1 8.75 3000 342.86February 1 8.50 3000 352.94

March 1 8.80 3000 340.91

TOTAL 36000 3831.48 36000 3428.57

Investor As SIP Investment has accumulated 3831.48 units whereas Investor

Bs Lumpsum Investment has accumulated 3428.57 units

Note: The figures of NAV are hypothetical and are for illustrative purposes only.


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Power of Compounding

No. of

Years

Amount

Invested (Rs)

Rate of Returns

8 % 10 % 15 % 20 %

5 60,000 72,945 76,561 86,331 97,216

10 1,20,000 1,80,214 1,99,864 2,59,973 3,39,119

15 1,80,000 3,37,606 3,98,444 6,09,229 9,41,053

20 2,40,000 5,68,999 7,18,259 13,11,707 24,38,856

25 3,00,000 9,08,991 12,33,325 27,24,642 61,65,871

30 3,60,000 14,08,551 20,62,843 55,66,559 1,54,39,875


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Power of Compounding

Regular Investments in an instrument giving 8 % returns would

have compounded to Rs 14, 08,551 vs. investments giving 15 %

returns compounded to Rs 1, 54, 39,875!!

If you wait to invest after 5 years in an instrument giving 15 %

returns then you are already behind Rs 86,331 in returns compounded.


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Start Early - Save for your future

Starts investing at age 30 Starts investing at age 40

Rs 1000 every month in an

instrument which grows @ 10 % p.a.

Investor Xs investment = Rs 20.62 lacs

At Age 60

Investor Ys investment = Rs 7.18 lacs

Investor Xs Actual Investment = Rs 3,60,000 Investor Ys Actual Investment = Rs 2,40,000

Investor X Investor Y

Investor Xs investment would have more than doubled

just by starting earlier than Investor Y


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How does PSIP work?

Select a scheme and decide an amount to invest (after all mandatoryexpenses & bills are paid)

Fill up an application form along with an Auto Debit Form (ECS) for the

period you would like to invest systematically

Submit the forms along with an initial investment cheque and submit

additional cheques (if not using Auto Debit facility) and a PAN proof

For every SIP investment, additional units will be added to your folio

(as per the prevailing NAV) at regular intervals

A statement confirming transaction and allotment of units will be sent

periodically (as per SEBI Mutual Fund Regulations 1996)


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Any Day SIP from Principal

SIP can be started on 1st, 5th, 15th and 25th of every month

SIP instructions to be given atleast two working days prior to the

chosen SIP date

First cheque submitted with the SIP form should be of the samebank as the one through which ECS is to be carried out

The Investment in the next month would be the nearest SIP date

i.e.1st,5th,15th or 25th of a month.

For example:

If the cheque date of an investor is 16th October07. Then he

will get the NAV of the same day and his SIP date will be of

25th November07.


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How to make PSIP work for you?

Set your financial goal Why are you investing?

Identify the scheme Invest in a scheme as per your objective /

risk appetite and long term performance

Decide the SIP Amount How much you would like to invest

monthly / quarterly?

Long term commitment PSIP is most effective in the long term

Aim for the big picture Invest regularly! Market fluctuations are

way of life do not get distracted.

Start Investing Take the 1st step! After all the planning go

ahead and finish the formalities and make PSIP to work for you.


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Performance of some of ourSIPs


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PSIP in Principal Large Cap Fund

Note: SIP Amount of Rs.1000 per month. Returns as on March 31, 2008

Last SIP Date = March 5, 2008, Inception Date = November 11, 2005

Returns are calculated on compounded annualized basis. Past performance may or may not be sustained

in the future.

SIP Period

GrowthOption

SIP returns

(%)

S&P Nifty

SIP Returns

(%)

Investment

Amount

(Rs.)

Value of

Investment in

Large Cap Fund

SIP

(Rs.)

Value of

investment in

S&P Nifty

(Rs.)

1 year - 13.82 -2.30 12,000 11,104 11,854

Since inception 15.65 17.94 28,000 33,474 34,312


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PSIP in Principal Personal Tax Saver Fund

SIP Period

Personal Tax

Saver Fund

SIP returns

(%)

BSE 100

SIP Returns

(%)

Investment

Amount

(Rs.)

Value of

Investment in

Personal Tax

Saver Fund SIP

(Rs.)

Value of

investment

in BSE 100

(Rs.)

1 year - 7.76 -5.45 12,000 11,502 11,651

3 years 26.24 23.69 36,000 52,546 50,673

5 years 33.90 31.08 60,000 1,36,972 1,28,515

Since

inception32.32 20.13 1,43,000 11,71,576 5,18,993


Last SIP Date = March 5, 2008, Inception Date: April 12, 1996

Returns are calculated on compounded annualized basis. Past performance may or may not be

sustained in the future.


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PSIP in Principal Tax Savings Fund

SIP Period

Tax Savings Fund

SIP returns

(%)

S&P Nifty

SIP Returns

(%)

Investment

Amount

(Rs.)

Value of

Investment in Tax

Savings Fund SIP

(Rs.)

Value of

investment

in S&P Nifty

(Rs.)

1 year - 13.63 - 2.30 12,000 11,116 11,854

3 years 24.50 24.26 36,000 51,236 51,065

5 years 36.48 29.93 60,000 1,45,425 1,24,817

Since

inception29.85 19.24 1,37,000 8,73,731 4,44,258


Last SIP Date = March 5, 2008, Inception Date: March 31, 1996

Returns are calculated on compounded annualized basis. Past performance may or may not be sustained in

the future.


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PSIP in Principal Resurgent India Equity Fund

SIP Period

Resurgent India

Equity Fund

SIP returns

(%)

S&P CNX Nifty

SIP Returns

(%)

Investment

Amount

(Rs.)

Value of Investment

in Resurgent India

Equity Fund SIP

(Rs.)

Value of

investment

in S&P CNX

Nifty

(Rs.)

1 year - 16.35 - 2.30 12,000 10,935 11,854

3 years 19.19 24.32 36,000 47,624 51,107

5 years 29.96 29.94 60,000 1,24,919 1,24,859

Since

inception35.81 26.31 92,000 3,77,842 2,60,100


Last SIP Date = March 5, 2008, Inception Date: June 30, 2000

Returns are calculated on compounded annualized basis. Past performance may or may not be sustained in

the future.


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So now whats stopping you from reaching out for your dreams?

Start a PSIP today!


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Thank You


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Statutory Disclosures & Risk Factors

Statutory Details: Principal Mutual Fund has been constituted as a trust with Principal Financial Group (Mauritius)

Limited, Punjab National Bank and Vijaya Bank as the co-settlors. Sponsor: Principal Financial Services Inc., USA.Trustee: Principal Trustee Company Private Limited. Investment Manager: Principal Pnb Asset ManagementCompany Private Limited. Risk Factors: Mutual funds and securities investments are subject to market risks and therecan be no assurance and no guarantee that the objectives of Principal Mutual Fund can be achieved. As with anyinvestment in securities, the NAV of the units issued under the scheme(s) can go up or down, depending upon the

factors and forces affecting the capital markets. Past performance of the Sponsor/ AMC/ Principal Mutual Fund/ PunjabNational Bank/ Vijaya Bank does not indicate or guarantee the future performance of the Schemes of Principal MutualFund. Principal Tax Savings Fund (An open-ended Equity Linked Savings Scheme; Investment Objective: To build ahigh quality growth-oriented portfolio to provide long-term capital gains to the investors. The scheme aims at providing

returns through capital appreciation.); Principal Personal Tax Saver Fund (An open-ended Equity Linked SavingsScheme; Investment Objective: To provide long term growth of capital. The Investment Manager will aim to achieve areturn on assets in excess of the performance of BSE 100 Index.), Principal Large Cap Fund (An open-ended EquityScheme; Investment Objective: To provide capital appreciation and /or dividend distribution by predominantly investingin companies having a large market capitalization. For the purpose of this Fund, Large Cap Companies are defined asthose having market capitalization greater than Rs.750 crore as on the date of investment (or any such amount as may

be specified by India Index Services Ltd (IISL) from time to time) being the upper limit of market capitalization as acriteria for inclusion of a company in CNX Midcap 200 Index. However, should IISL come out with a definition of 'LargeCap companies', the same will be utilized.) and Principal Resurgent India Equity Fund (Investment Objective: To

generate long term capital appreciation by investing in equity and equity related securities of Indian companies that areperceived to be potential growth stories.) are only the names of the Schemes and do not in any manner indicate eitherthe quality of the Schemes or their future prospects or returns. The Sponsor is not responsible or liable for any lossresulting from the operations of the Mutual Fund beyond the contribution of an amount of Rs. 25 Lakhs towards settingup Principal Mutual Fund. Investors in the scheme(s) are not being offered a guaranteed or assured rate of return ormonthly or regular/periodical income distribution, and the actual returns and/or periodical income distribution of aninvestor will be based on the distributable surplus. For scheme specific risk factors, terms of issue etc. investors are

urged to read the Offer Document carefully and consult with their legal/tax/investment advisor before they invest theScheme. Copy of offer document of the scheme(s) can be obtained at the investor service centers of AMC and our Toll

Fee No: 1800 22 5600 and Website: www.principalindia

.com

Documents

Systematic Investment Plan - 280408