Generally,retail investors don’t invest in stock market for longer term or start systematic investment for short term like 03 years and then won’t renew it. Not having a goal behind investments may be one of the important reason that prevents investors from staying longer term in the market.
Considering this, Reliance mutual fund will launch Goal based investment plans Viz.Reliance Retirement Plans with two variants :Wealth Creation through Equity and Income generation through aggressive debt opportunities.
Reliance Retirement Plan Wealth Creation : It will be Equity oriented scheme with exposure in Large and Mid Cap stocks along with fixed income instruments.
Reliance Retirement Plan Income Generation : It will be Debt oriented scheme.
Reliance mutual fund retirement fund is expected to open on January 22, 2015.
Exit Load: As this is Retirement plan there will be exit load to discourage investors from early exit from scheme. Scheme may apply exit load of 1% till investor attains age of 60 years.
Other mutual funds like HDFC or ICICI Prudential already have goal based products like childrens Care Plan but don’t have a great success in comparison with other general equity schemes.
Year 2014 was very good for equity mutual funds especially after underperformance for few years. There was broad based buying across all the sectors and funds including underperformed sectors like infrastructure have done well…if we consider market caps , small caps or micro caps have provided returns of more than 100% in last year.
But now one should be careful in 2015 about fund selection and mere past last one year performance may not help. Fund portfolio will be more important now rather than performance in last one year.One should not concentrate on small or mid caps just based on performance in last year.
Long term investor should continue with diversification strategy and can start investing in following funds:
- ICICI Prudential Focused Bluechip Equity fund (50%) : Large cap oriented fund which invests predominantly in established companies. Avg market cap of stocks held by this fun is more than 96,000crore.
- HDFC Mid Cap Opportunities(25%): This is Mid cap oriented fund and invests in quality mid cap stocks.
- Franklin India Prima Fund(25%):Franklin India Prima Fund is mid cap oriented fund which invests in quality mid cap stocks.
One can invest 50% in bluechip fund and 25% each in two mid cap funds. Means if any one is looking to invest Rs.10,000 per month then invest Rs.5000 in bluechip fund and Rs,2500 each in rest mid cap funds.
A long term investor can avoid investment in pure small cap fund. and rather prefer to invest in funds having some exposure towards small cap (market cap less than 5000 crore) like above mentioned funds.
IFCI Ltd – Institution promoted and controlled by Govt Of India has come up with Secured NCD issue which have opened on Jan 01, 2015.Issue offers two investment options Viz. for 05 yrs and 10 yrs period. IFCI is looking to raise Rs.250 crores through this tranche and can retain oversubscription up to Rs.790.813 Crores. Important details of issue are as follows:
- Issue Open Date: Jan 01, 2015.
- Issue Close Date: Feb 04, 2015.
Credit Rating :
BWR AA- (Stable outlook) and CARE A (Stable).
Annual Interest Payment Option:Cumulative and Annual Interest Payment option.
For Retail individual investors:
|Coupon Rate For HNI and Individual Investors
Considering low interest rate scenario ahead, above interest rates are still good considering period of 05 or 10 years for general public. One can think to invest some part in this issue from fixed income portfolio.