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  • Category: Miscellaneous

    "Sensex scales a new high by crossing 35000 mark."

    The Sensex today crossed the 35000 mark for the first time. It surged by 310.77 points to close at 35081.82. The Nifty also increased by 88.1 points to close at 10788.55. I have invested Rs 700000/ in mutual funds sometime back. With a lot of expectations, I checked the portfolio and found that Rs7563/ were lost on this day. What is the lesson that is to be learned from this?
  • #623306
    The Sensex has touched record heights. The investors are very happy. I have also invested some money in MFs. after seeing this post just I have contacted my financial advisor and checked the MF values as on today. They are all good and they are all on positive side only. While investing in mutual funda we should see and select good funds for investing. I don't know in which MFs the author has invested. Of course, there will not be any problem they will also pick up. When we select the funds we will have to have look at its performance and the investing pattern of the fund. They will play an important role and always we should have a watch the values and see whether we have to shift the fund to another portfolio. It requires some help from the people who are in the line and whom we know very well and who are expected to be our well-wishers. If we take these precautions there will not be any problem for our investment.
    drrao
    always confident

  • #623307
    I have invested in HDFC, ICICI Balanced funds, DSP Black Rock Tax Saver fund, and others funds as per the advice of a consultant. I am surprised that on a day when Sensex created history, I lost some money. This will be covered very easily but what the fund managers are doing? Maybe there is much selling pressure on the stocks in which they invested on our behalf.
    " Be Good and Do Good "

  • #623313
    Mr. KVRR has raised some legitimate questions. I am trying to reply these questions with my limited knowledge.

    (a) Although the equity market is gaining new heights almost every day, the bond market is going down. The exact reason for the bond market going down is not known to me because I don't track bond market. Perhaps the continuous decrease of interest rate has some role in this regard. As a result, the balanced funds (which keep around 35% of the total asset in bonds) are losing money. I have a good amount in HDFC Balanced Fund, but it is also losing money.
    (b) Secondly, as the equity market is gaining new heights, cautious investors are transferring money from equity funds fearing sudden downfall. Due to redemption pressure, the equity funds are showing a marginal loss.

    Beware! I question everything and everybody.

  • #623318
    This is the classic scenario wherein Warren Buffet has said have fear when everyone is greedy. have caution when the markets are soaring high.

    The market is high doesn't apply to every stock or mutual fund. For instance today some stocks like Zee entertainment have lost about 3.5% of their value.So, if the mutual fund you have invested in has some stock that is in the phase of decline or in the phase of recovery from a recent decline then it would reflect on the fund you hold.

    I'm glad you've raised this question because there are people who invest in mutual funds and plan to encash just before a major commitment. Many advise caution against this practice as in your case Rs 7L you invested may be at a peak or at the bottom, so if you have a mandatory comittment then it is better to encash a few months earlier and put it in a fixed return, risk-free instrument.

    With regards to the bond market, China has apparently made some statements to the effect that it would not invest in US bonds.

  • #623322
    Mutual funds update their NAV late night on a particular day. So what loss you are seeing in your portfolio is from yesterday and not from today. Check your portfolio in morning tomorrow.

  • #623325
    I maintain the portfolio on Moneycontrol web site. All the Mutual funds in which I invested, balanced funds, and equity funds all showed loss today. Maybe what you said is correct. I will watch tomorrow. What was the position of the stock markets yesterday?
    " Be Good and Do Good "

  • #623328
    I do not have a portfolio of investment. Whatever saved money I have , I just keep in bank.
    However whatever theoretical awareness I have from reading on the matter and hearing from others, I can say that it needs smartness, sometime quick decision ,sometimes much patience and some luck to make money from financial market.

    Mutual funds asset valuation depends on the spread of the investment made by a fund. In the stock index each share has a certain weightage. Not all listed shares have effect on the index also. The basket of investment in stocks by the Fund may be such that a few would have sen rise in prices and more would have seen fall in value. So the fund will show only the net asset value. To know the referred stock index rise and its effect on a particular fund, we have to know the correct component of investment by that fund and their quantum.

    Additionally, MF NAV are not changing hour by hour or minute by minute like the stock exchange prices. The stock exchange fluctuations may get reflected next day or two. The funds also do some reactive sell or buy and only after closing these the valuation can be arrived.
    In MF there are certain expenses too which also will reflect in the value.
    So one should not expect the same rise and fall in the stock markets.

    All said and done, stock market and organised investment sector has its own syndicates and inside players. The small investor is always at their mercy and gets only the residual left out after the big sharks have extracted their profit.

  • #623337
    This is a very interesting discussion indeed. I see there are folks at ISC who invests in Stock Markets and Mutual Funds.

    Everyone is correct in their sense.. Mutual Funds are not to track on daily basis. One should invest in Mutual Funds with a long term view..

    To go deep into the Market analysis, Sensex / Nifty have been making new Highs this year. Every alternate day, the focus is moving from one sector to other sector.

    Those invested in Mutual Funds, No need to worry as they are long term oriented.

    Long Term investors (into stocks), If you are sitting with good amount of profits, It is suggested to book some profits and continue to hold the rest in case the underlying stock is Fundamentally strong. Accumulate more quantity in case if the stock corrects between 10 - 15% from the tops.. As the overall sentiment is positive, even the small cap stocks whose balance sheet is not good are also moving very fast. But one need to be very cautious in these counters. They need to book profits and stay away.

  • #623364
    Ankit, you are correct. Today morning checked the portfolio on the Moneycontrol web site. It showed a profit of Rs 1723/.
    " Be Good and Do Good "

  • #623538
    The other simple point to add is most investors invest and view the graphs or values very few months etc. There would be fluctuations but if you look at the large picture the investment would certainly grow barring a major crash or global depression. For instance, one can check the sensex graph over a 10 year or 20 year period, then one can see the growth.


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