Manufacturing demand: Mutual fund

I had done a post on manufacturing demand…..all industries follow the same process…see how it works..

 

1. Create a scare:

MF Industry: Mr. Subra i hope you invest in mutual funds….

Subra: No..i invest in direct equities..

MF: But sir Direct equities is risky, is it not?

Subra: hmm…welll…er…it has worked for me…

MFI: Sir maybe you were plain lucky…but you do admit it is a difficult job. Sir you could lose money…afterall u do not have so much money to build a big portfolio, you do not have the brains, you do not have a team,……….blah blah…

Subra: but I am a CA / a decent stint in an Ivy League school /, a degree in law /..a few accounting exams passed…

MFI: Sir that was long ago sir…now the markets are far more difficult….

I am sure you get the hang….

2. Seduce the investor:

MFI: Sir over the past 212 years we have given a return of 13% p.a.

Subra: Wow! that is awesome, indeed…I am impressed…tell me more.

MFI: Sir even though the next year may not be the same as last years, over long terms of time, it holds true…so blah blah blah…

3. Throw tax benefits

4. Talk about time availability

and hey you have created a market, right?

for good fund managers and bad fund managers. Or like a friend says for bad fund managers and worse fund managers.

If there are good fund managers also see how much of inside information they deal with.

If you have no access to inside info and other corrupt (but money making opportunities) best is to follow and become one of the 40 thieves.

You only hope that an Alibaba does not come along and break your business.

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5 Responses to “Manufacturing demand: Mutual fund”

  1. “past 212 years” – did you really mean that? was it 2 1/2 years instead?

  2. “Follow and become a thief” as in tracking holdings based on disclosures?

  3. But Subra sir, you keep saying “Invest SIP in MF”.

  4. EV absolutely yes. If you do not learn how to cook, you need to eat in a hotel or hire a cook. I do not find anybody willing to invest in LEARNING.

  5. Could you answer Mira’s question?

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