[chennai-indian]

Originally Posted by digitalnirvana

Thanks for the kindness.


The modest wealth that I create will be for my retirement, if I am able to ever meaningfully retire, and for the next generation.

If this helps anyone, I only wish to have not done those mistakes and stayed the course for 18 long years.

It is never too late. I'm 52 and an "IT Coolie" too. Invest as much as you can, and cut down unnecessary expenses. Build an emergency fund. All possible. Invest in Index funds.
I did it by starting my investment journey 7 to 8 years back - I'm not financially independent now, but I have a substantial cushion.

[deepakshenoy]

Originally Posted by spookey

Deepak is also a fellow Team - Bhpian can't recollect his handle here though. On a twitter engagement some years ago i had casually enquired his absence here and he acknowledged it due to pre occupation with Capital mind.

I'm here

Thanks for the mention, and I'll try to be around more (now that we have a mutual fund thread here!)

Happy to answer any questions and would love to hear from all of you on what you miss and want in the MF industry.

Also, a proud owner of a Slavia 1.5 and an XUV 7OO Ax7L, and still have the S-Cross Diesel. (Our customers have the Mercs and the Audis, and it's probably better that way!)

[DigitalOne]

Originally Posted by deepakshenoy

Thanks for the mention, and I'll try to be around more (now that we have a mutual fund thread here!)

I truly can't believe my eyes. As I wrote just yesterday, I have gained immensely from your blogs and newsletter. I started investing in Momentum MFs (though very late and missed most of the 2022-23 gains) after reading blogs in CapitalMind.

Wish you and your team the same kind of success in the MF space, that you got with your Portfolio management services.

Originally Posted by DigitalOne

Wish them the very best!! Deepak Shenoy/CapitalMind runs a fantastic blog. I give a nod of thanks whenever I pass their office in HSR layout .

Regarding your MF venture, please do only Active (focused) fund management . There are just too many passive funds or index huggers. Also, if you are eligible, please start a Strategic Investment Fund (SIF).

[SoumenD]

Originally Posted by digitalnirvana

Thanks for the kindness.

To be honest, I am 18 years too late. Burned my funds in GFC 2008 and then sat out of the greatest wealth creation period of my age.

Now dipping my toes back in, far far too late. I'm 41 now and as an IT coolie the runway is very limited.

The modest wealth that I create will be for my retirement, if I am able to ever meaningfully retire, and for the next generation.

If this helps anyone, I only wish to have not done those mistakes and stayed the course for 18 long years.

Wow that's eerily similar. Am an IT coolie too aged 40. I did crash out of markets in GFC and didn't return for more than a decade myself after the horror.

Restarted only around 2020 with index funds primarily and have continued since then. We can barely do much about the lost time, so just follow the process. I don't do SIPs anymore, its all manual investing every month.

As I don't have the luxury of time by my side am making sure of investing 50% or more atleast religiously every month. 40+ in IT is a tricky phase, specially in India.

[handsofsteel]

My perpetual doubt, and one that I haven't gotten around to resolving. I have been investing regularly in MFs since 2011/12 through SIPs/ lumpsum purchases. My modus operandi was elementary, scour financial literature once a year, shortlist 5 funds which were rated 5 star by at least three different outlets and start a SIP with these. Forget all about them till the next annual review. Over a period of time, these generated good returns. During the next annual review came the doubt - some of these funds had slipped from the 5 star rating. I maintained existing SIPs even if they became 4 star rated. If they slipped further, paused these and started a new SIP with another 5 star rated fund.
If they slipped further below 3 star or seemed like slipping, checked the ROI of these and sold them (as long as it was over 15% return).

Now, what do you do with the realised profit assuming you do not have an immediate requirement and want to maintain the equity component of the investment? In a rising market, the realised amount would fetch me lesser units than what I sold. So if I am buying into another fund, am I not, in effect, getting lesser for my buck? For want of a better thing to do, I kept doing this (or letting it remain in the original fund where it was still showing me a decent profit), but can't help shake off the feeling that I could've done much better. Now, with the capital gains tax kicking in, I really do not know if the corpus will not take a heavy hit during redemption whenever I need the money.

[xcentrk]

Originally Posted by SoumenD

Wow that's eerily similar. Am an IT coolie too aged 40. I did crash out of markets in GFC and didn't return for more than a decade myself after the horror.

Restarted only around 2020 with index funds primarily and have continued since then. We can barely do much about the lost time, so just follow the process. I don't do SIPs anymore, its all manual investing every month.

As I don't have the luxury of time by my side am making sure of investing 50% or more atleast religiously every month. 40+ in IT is a tricky phase, specially in India.

Exact same scenario, only that I am an IT freelancer since 2019. 39 years old, started investing from 2014 but withdraw it around 2019 due to various reasons. I still regret it because the gains were excellent during those periods.

Again started investing from 2021 and gradually started putting 30% of earning and now putting 70% of my earnings into savings. Because of less time window for retirement.

Also, PF in IT companies are a joke. Most of the companies hike salaries in other components and let the Basic Pay to stagnate to avoid paying PF. Of 12 years of service, the total PF amount I have now is around 6L. Pathetic! Private employees are one of the most vulnerable ones.

[kavensri]

Originally Posted by xcentrk

Also, PF in IT companies are a joke. Most of the companies hike salaries in other components and let the Basic Pay to stagnate to avoid paying PF. Of 12 years of service, the total PF amount I have now is around 6L. Pathetic! Private employees are one of the most vulnerable ones.

Just want to comment on the PF part.
There is a new policy which mandates 33% of your base pay to be Basic. And as you know, PF depends on Basic. This is being religiously followed in our company. I have checked with couple of my friends and this is being followed in their companies as well.

[sagarpadaki]

Originally Posted by xcentrk

Also, PF in IT companies are a joke. Most of the companies hike salaries in other components and let the Basic Pay to stagnate to avoid paying PF. Of 12 years of service, the total PF amount I have now is around 6L. Pathetic! Private employees are one of the most vulnerable ones.

You can add additional amount into PF by means of VPF. But yes, the interest earned on any contribution above 2.5L to PF(incl VPF) is taxable. So you can do some math and see how much extra you can contribute so that Company deducted PF+ VPF <=2,50,000 per year. This is what I do. Of course, beyond a certain salary, the PF contribution itself will cross 2.5L/Year without the voluntary VPF and will have tax implications. Cannot help much in that case. But until that ceiling is hit, you can add VPF from your end

[xcentrk]

Originally Posted by kavensri

Just want to comment on the PF part.
There is a new policy which mandates 33% of your base pay to be Basic. And as you know, PF depends on Basic. This is being religiously followed in our company. I have checked with couple of my friends and this is being followed in their companies as well.

Originally Posted by sagarpadaki

You can add additional amount into PF by means of VPF. But yes, the interest earned on any contribution above 2.5L to PF(incl VPF) is taxable. So you can do some math and see how much extra you can contribute so that Company deducted PF+ VPF <=2,50,000 per year. This is what I do. Of course, beyond a certain salary, the PF contribution itself will cross 2.5L/Year without the voluntary VPF and will have tax implications. Cannot help much in that case. But until that ceiling is hit, you can add VPF from your end

Thanks for the information. But I quit full-time and started full time freelancing. So no PF hassle and I can invest wherever I need. I invested in FD, SGB, Gold, MF, Stocks, Post Office and some more for my kids. Hoping to continue the same for as long as I can work. Let's see how that goes.

[prajwalmr62]

Originally Posted by gischethans

Momentum investing is their stronghold, and with the mutual fund approval, they are looking to launch active mutual funds for investors. The first NFO is a few months away, tweeted Deepak.

I'm currently investing in Parag Parikh Flexi Cap fund and Quant Small Cap fund in 80-20 ratio. I was exploring momentum funds to diversify a bit and hopefully to get a better return.

I'm a very passive investor and do have a long time frame for equity. I re-balance funds once a year, and do not monitor fund performances frequently. I'm thinking of using momentum funds for shorter duration, preferably 3 year time frame for re-balancing. Would you suggest momentum funds for someone like me? If so, what is the ideal percentage according to you?

[SoumenD]

Originally Posted by xcentrk

Thanks for the information. But I quit full-time and started full time freelancing. So no PF hassle and I can invest wherever I need. I invested in FD, SGB, Gold, MF, Stocks, Post Office and some more for my kids. Hoping to continue the same for as long as I can work. Let's see how that goes.

PF actually is a solid debt instrument. 8% + tax-free ROI is equivalent to ~10% taxable MFs without the volatility. The compounding effect is super solid at the later part of your career. A colleague of mine who is a few years senior mentioned his annual interest is way more than his own & company contribution combined & its not like he has some crazy salary like 70/80LPA.

I understand in your case its not really relevant but in general whoever has an option and wants debt allocation, it can be a great option.

[xcentrk]

Originally Posted by SoumenD

PF actually is a solid debt instrument. 8% + tax-free ROI is equivalent to ~10% taxable MFs without the volatility. The compounding effect is super solid at the later part of your career. A colleague of mine who is a few years senior mentioned his annual interest is way more than his own & company contribution combined & its not like he has some crazy salary like 70/80LPA.

I understand in your case its not really relevant but in general whoever has an option and wants debt allocation, it can be a great option.

Let me see if I can invest in PF. Thanks for the clarification. Yes, tax-free does make it an attractive investment option.

[kavensri]

Originally Posted by SoumenD

PF actually is a solid debt instrument. 8% + tax-free ROI is equivalent to ~10% taxable MFs without the volatility. The compounding effect is super solid at the later part of your career. A colleague of mine who is a few years senior mentioned his annual interest is way more than his own & company contribution combined & its not like he has some crazy salary like 70/80LPA.

I understand in your case its not really relevant but in general whoever has an option and wants debt allocation, it can be a great option.

I belong to the same category. Though I missed out on investing in equity till 2021, what I did religiously was to invest additional 28% in VPF. I did this for more than 20 years, till they brought in the restriction of 2.5l.
Now, my PF interest for last FY was more than double the contribution amount. The compounding effect has really kicked in for me.
So, my PF balance would become a substantial part of my retirement corpus in the future.

[Fx14]

Originally Posted by deepakshenoy

I'm here

Also, a proud owner of a Slavia 1.5 and an XUV 7OO Ax7L, and still have the S-Cross Diesel. (Our customers have the Mercs and the Audis, and it's probably better that way!)

Reminds me of the following quote

Warren Buffett — ‘Wall Street is the only place that people drive to in a Rolls Royce to take advice from people who ride the subway.’

[DigitalOne]

Originally Posted by handsofsteel

My modus operandi was elementary, scour financial literature once a year, shortlist 5 funds which were rated 5 star by at least three different outlets and start a SIP with these....

Now, what do you do with the realised profit assuming you do not have an immediate requirement and want to maintain the equity component of the investment?

Give yourself due credit and a pat on your back . You have a rock-solid process to select the good performers and weed out the bad performers, yet keeping fund churning to a minimum.

On your question, you seem to have the misconception that funds with low NAVs are value buys? The most fundamental concept of the mutual fund investing is that absolute NAV doesn't matter. Just the growth/decline percentage of the NAV. As long as the equity allocation is maintained, and you have weeded out the non-performers, you are good.

We all get these self-doubts and regrets in our investing journey. Mine is that I invested very little in small cap funds, though I could have taken the risk.

Originally Posted by prajwalmr62

I'm currently investing in Parag Parikh Flexi Cap fund and Quant Small Cap fund in 80-20 ratio. I was exploring momentum funds to diversify a bit and hopefully to get a better return.

Quant AMC itself tends to follow a high churning, highly active investment philosophy. Momentum factors are inbuilt into their stock selection models. Hence, I would not suggest adding a specific momentum fund.

Parag Parikh Flexi cap on the other hand has a buy-and-hold philosophy. So these two funds complement each other perfectly well. The 80%-20% mix is also the right blend of safety + risk for the long term. Just keep a watch on the Quant Small Cap fund and keep book profits if it runs up high.

Kudos to you on the choice of funds .