I have a few friends, cousins, etc. who ask me BEFORE THEY INVEST…here is an email that got forwarded to me saying…sounds too good to be true, want you to say my decision of saying NO is correct…

I have reproduced the mail here..was sent by a National Level Distributor (not a bank) …clearly violating SEBI norm of not indicating returns. My goodness that I am not reproducing the name of the product, the name of the ND..

Quote starts here:

Please be informed about the launch of the NFO “XXX – 3 Years Plan “. If you will be happy with around 12 to 13% returns per year this is the right product you are looking for.
Offer period: abc  – def…..

A simple product alternative to FMPs, Bank FDs and MIPs. Considering the equity market being volatile and short term interest rates holding at historic highs, this debt product will a best option for resident individuals, HNIs and NRIs to invest for a period of 3 years.

Quote ends here.

My take: I will be surprised if this fund after expenses but before tax yields in excess of 10% p.a.

Well buyer beware? Caveat Emptor ??

What about those people who first invest and then ask? Well God bless them also!

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  1. Subra,

    Good point. But help understand, how do you temper the greed – a) of the investor , b.) of the distributor

  2. OK you are right. Pl advise me whether I shall invest in Gold ETF or buy in physical form from the market? Gold ETF in India have expense ratio of 2.5% as against 0.6% in USA. Also non of them invest 100% in Bullion. On the other hand though Banks are reliable, they sell Gold coins at 10% higher than the market and do not buy back! I don’t fall in Wealth Tax category and have a locker in Safe Deposit Vault.

  3. Nikhil avoid Gold. Let me repeat avoid gold. However if you must invest in gold buy Gold bees – by benchmark mutual fund – if you have a brokerage account.

    If you do not have a brokerage account, buy a biscuit and keep it in the locker.

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