National Savings Certificate (NSC) is one of the investment options the Government of India offers. NSC investments are received and serviced by the National Small Savings Fund, managed by the government through the interface of post offices.
A type of mutual fund or exchange-traded fund, index funds are designed to follow certain pre-set rules. They are passive strategies, wherein the objective of the fund is to replicate the performance of underlying indices such as the Sensex, Nifty 50 or Nifty Next 50.
Investing may be considered more of an art than a science. Amidst a wide range of investment options, products may be selected basis individual risk profiles, financial goals and investment horizons. Within an investment portfolio, the focus should also be on diversification and optimal asset allocation.
Diversification of investment portfolio across different asset classes
Make volatility help you create wealth
The long journey to major financial goals like buying a home, children’s higher education and retirement, is comparable to a long distance flight or a sea voyage. In Air travel you sometimes experience uncomfortable air pockets and choppy seas in case of sea travel. Of course, we don’t interrupt or abandon those journeys because turbulence is a part and parcel of them.
As we enter the month of December we become just that bit more aware of ticking of time. The change of year beckons. It is customary to reminisce over the events of the year gone by. But remember that while value compounds over time; the actual passing of a year or a quarter matters very little if at all in the markets. This has been a good year for equity investors around the globe. The MSCI* All Country World Index is at a lifetime high.
I was told I could address any of the following four questions in my article. But why stop at one if you can go for all four? Especially if all four are linked inexorably in some form.
The questions and the corresponding answers are below -
As the parent of two teens I have seen them evolve over time. From the joys of the new born who holds you tight it is quite an eventful journey till they get to adulthood and spread their wings. Having just been to my elder child’s graduation (12th standard) and with adulthood now just a few days away it has been quite a satisfying journey.
UTI Equity fund has a strong predilection towards investing into businesses that have strong and steady profile of free cashflow generation, high RoCEs through the cycle and a high visibility of long term growth.
“Change is the only constant” is an adage which applies perfectly to not just the macroeconomic environment but also to the equity markets in general. Behind every ‘fall in the market’ there will always be some events just as behind every ‘rally in the market’ there will be other events. It is the circle of life for markets. At some point the markets will get over-valued, events seen as negative will happen; resulting in markets getting “de-rated” and dropping into the “cheap” zone.
Asset allocation: The on-going equity market drop once again highlights the need for investors to follow a prudent asset allocation strategy. Every asset class goes through cycles. Equities are a volatile asset class with attractive long term returns. Similarly fixed income returns can be attractive over shorter time periods though over the longer term it typically lags equities. This reinforces the need for asset allocation in order to manage risk and optimize returns.
