Comments on: Mutual funds ha!

By: Ashok

Ashok — Wed, 09 Jan 2013 03:49:52 +0000

The “direct” plans seems to have started without fanfare. An SIP investment made in IDFC MF shows me as “IDFC-SEF-DIRECT-Growth”. Previously it was just “IDFC-SEF-Growth”.

And looks like as predicted all old “direct” investors like me have to explicitly switch to this.

Will we have a STCG impact if we switch?

Ashok

By: Karthik

Karthik — Wed, 14 Nov 2012 06:34:46 +0000

Dear Subra sir,

Thanks for the insight.I would like to know if you can advice a method for starters inorde to invest directly in the markets.Would picking the top 10 stocks in the portfolio of well managed large cap funds (good track record for more than 10 years) and choosing few common stocks across mutual funds and investing directly in these stocks be a good idea??

It would be very helpful if you can comment on this as I do not have the expertise or the time to analyse each stock.

Can you give us a broad guideline to invest directly in stocks as I have most of my investments in Mutual Funds and understand that the costs are pretty high.

By: vignesh

vignesh — Sat, 10 Nov 2012 07:51:58 +0000

sai

U continue SIP . Direct equity investment can be done only once u are able to come to take a decision on seeing the company reports.

That tkes time:)

Nothing to confuse.

Subra tells here —> Direct equity cost you less than ur SIP.

You need to take this in that manner

By: sai

sai — Thu, 25 Oct 2012 08:11:57 +0000

subra sir,by reading your blog,i started sip and now this article confused me a lot.Direct equity is always difficult for me.what should i do now?

By: subra

subra — Thu, 25 Oct 2012 03:12:28 +0000

Love you Ashok…i hope u keep taking home loans from Hdfc (after all real estate gives >18% returns and home loan costs about 11% pa.), deal with Hdfc bank, and trade through Hdfc securities.

thanks for investing in Hdfc mutual fund too…

as a shareholder of Hdfc Ltd what more can I want? thanks once again. You are right.

By: Ashok

Ashok — Wed, 24 Oct 2012 14:04:19 +0000

>> if u are good enough to qualify as an Engineer, MBA, CA, Doctor, what makes you a moron while investing

Subra sir,

I have made a similar comment before and I will make it again now.

Do you drive your own car or do you have a driver? As for me (when I get higher up my organisation and can afford it) will go for a driver. Since the time and stress in traffic jams, I can do a better job as an engineer. My 2 hours everyday will be worth more than the 8K I pay to the driver, right? ( Yes, it will be… I know my billing rates ).

Why should I spend my weekends studying reports and statements? I pay Prashant Jain to do that for me.

By the way, HDFC Equity charges 1.78% only as AMC. And that has been a super super fund for all these years.

ps – I have been a MF investor for 9 years and a “direct” investor for 4 years. Total time taken for fund selection + SIP investments + tracking = approx 24 hours PER YEAR ( 2 hour per fund ).

By: subra

subra — Mon, 22 Oct 2012 21:01:32 +0000

subbu,

because if i know that a fund manager who achieved superior results over the past 14 years will continue to perform over the next 22 years, I do not need to worry. However that is a wrong assumption. NO MUTUAL FUND IN INDIA will be able to give you REAL returns along with a 2.8% albatross. Understanding reported results is of NO use, simply because ‘Past is NOT an indicator of the future’. The ONLY thing u can do as a customer is have a demonic control over costs.

By: Subbu

Subbu — Mon, 22 Oct 2012 17:48:36 +0000

Subra, I have a basic doubt. Could you please clarify me. Why should one bother about mutual fund fee, if that MF is able to give higher returns. For example, Fund A has 2% expense ratio and 15% returns, Fund B has 2.5% expenses ratio and 16% returns (Assume that same performance will continue in future also), should I invest in fund A or fund B? Here one of my major assumption is reported NAVs calculated for mutual funds are after deducting expenses. Please clarify if this assumption is correct or not. Thanks in advance.

By: Sanjay Singhaniya

Sanjay Singhaniya — Mon, 22 Oct 2012 14:23:04 +0000

Muthu Said:
Forget Nifty or Sensex, good funds have beaten their other benchmarks like BSE 100, BSE 200 and BSE 500 as well. Active management has worked so far in India. When the fact scores over the concept (of passive investing), it is better to go with the fact.

Muthu,
Always remember that while comparing with benchmarks, dividends of benchmark are not considered. Thats why comparison is lop sided. In fact, if companies stop giving dividends, you can see that many funds which beat benchmark regularly will start falling behind benchmark.

By: Mira D

Mira D — Mon, 22 Oct 2012 06:30:16 +0000

Subrabhai, thank you for this eye opener. for very long I have been dutifully putting money directly into 3 MFs, directly and sort of SIP like, but this is it.
Grateful.