NEW DELHI: Short-term returns of India’s equity-linked mutual funds are anything but positive currently. Smallcap, midcap, ELSS and multicap fund categories have fallen 3-10 per cent in last one year and by a similar percentage in last three months, underperforming the Sensex, which has declined 5 per cent in last three months after climbing 7 per cent in last one year. This has made some investors wonder whether one should dump their fund managers and make their own portfolio of diverse stocks. Industry veteran Prashant Jain of HDFC Mutual Fund says these short-term hiccups should not deviate investors from their long-term goals. “Mutual funds allow better handling of non-systematic risks and quality of diversification for retail investors,” Jain said. Buffett or Bogle? There are two contrasting views: One by John C Bogle, founder of the Vanguard Group, who believes in index funds, which are a passive form of investing; while Warren Buffett advises value … [Read more...] about Prashant Jain on why most retail investors can’t outperform MFs
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By Dhirendra Kumar It’s hard to recognise something that does not follow an expected pattern or fit a conventional template. For investors and analysts, this is the exact case while observing the wave of reforms that is happening in the Indian economy. These changes on Indian businesses are deep and hugely impactful but since they don’t fit the established ‘reforms template’, all of us talking heads sometimes fail to recognise them. Last week, I had an opportunity of participating in an interesting discussion organised by S&P Dow Jones Indices. While listening to the astute insights of the speakers, I realised that, to some extent, we are all prisoners of what we think is implied by the word ‘reform’. Most of us have this conventional idea in our head as to what ‘economic reforms’ are. Mostly, it’s the 1991 template that was first created by the PV Narasimha Rao government. Lower tariffs, no licensing, foreign ownership, free … [Read more...] about What’s an economic reform, as we know it?
In stock market, be fearful when others are greedy and greedy when others are fearful — Warren Buffett Going by this piece of wisdom from the legendary investor, it seems time is ripe on Dalal Street to build portfolios, as most market participants have turned cautious on worries over trade war, rising oil prices and ahead of general election, 2019. Market creates opportunities to buy stocks at lower levels. Investors just need an eagle eye to hit the right spot. The BSE smallcap and midcap indices are down in double digits for this year after rallying more than 70 per cent between January, 2015 and December 2017. When individual stocks have tumbled up to 90 per cent so far in 2018, it is time to build portfolios. The biggest alpha creators will come from these stocks. But be careful, ignore the low-quality stocks. “Small and midsized companies would grow slightly faster than their larger peers. I think if you are diligent in your stock research and balance sheet … [Read more...] about Be greedy when there is fear: Tips to bag big alpha generators
NEW YORK: MacKenzie Bezos, soon-to-be ex-wife of Amazon founder Jeff Bezos, has promised to donate half her fortune to charity, joining the ranks of the world's ultra-wealthy philanthropists, the Giving Pledge has announced. The charitable organisation, founded in 2010 by Warren Buffett and Bill Gates, listed MacKenzie Bezos, an American, among 19 new signatories of the pledge from China, Switzerland, the United Arab Emirates and Britain. She instantly became one of the world's wealthiest individuals in April, gaining a net worth estimated at $36 billion after finalising the terms of her divorce with Jeff Bezos, the world's richest man. MacKenzie is going to be amazing and thoughtful and effective at philanthropy, and I’m proud of her. Her letter is… https://t.co/YoohADeiiG— Jeff Bezos (@JeffBezos) 1559050724000 "In addition to whatever assets life has nurtured in me, I have a disproportionate amount of money to share," MacKenzie Bezos said in a letter … [Read more...] about Jeff Bezos’s ex-wife MacKenzie joins billionaire philanthropist club, pledges $13 mn to charity
Aditya Narula, an eighth class student from Meerut, forced his father to go for Marvel Studios’ latest superhero film, Avengers: Endgame in the very first weekend. Such was the rush for the movie when it opened on April 26 that some theatres operated 24x7, tickets got sold out a week in advance and in some places grey market ticket prices soared up to 10 times. The trigger for the rush was not really the superheroes, but what stock analysts call FOMO or fear of missing out – a behavioural response that leads to herd mentality in stock investing. Aditya fears missing the movie viewing experience and being left out when his classmates and peers discuss the movie the next day. “The desire to be first to earn bragging points (greed, in stock market) often comes at an additional cost,” says Jiten Parmar, co-founder, Aurum Capital. Financial markets are full of such instances, when investors ignore valuations to run after a trending theme, even if it means … [Read more...] about Went for Avengers in first week? You are at risk of losing money in stocks