3 Best International Mutual Funds to Invest in India

(Published on 17-Oct-2020)

Many readers are asking about International Mutual funds and some good International Mutual funds to invest. International Mutual funds are one category of Mutual funds which primarily invest in stocks of companies listed outside India. These funds are high risk in nature, however for portfolio diversification purpose, one can look into these Mutual funds. Based on the risk appetite and time horizon, one can invest into these International Mutual funds accordingly. Because of the volatility in Indian Markets, the International Mutual funds came into focus and becoming attractive among the investors.

What are International Mutual funds?

International Mutual fund is one category of Mutual funds which invests in companies located out side India. These are high risk Mutual funds and are suitable for the investors who are having high risk profile. Hence, this is suggestable for younger generation and who are looking for better portfolio diversification. As these funds are investing in companies located out side India, the risk exposure is high, but at the same time one can expect the chances of higher returns. As the increase in awareness of Mutual funds, the International mutual funds are getting popular among young generation whose risk profile is higher than an average Investor.

Why International Mutual funds?

1. For tapping the earning opportunities out side the country
2. For portfolio diversification
3. For long-term alternative investment
4. For hedging against rupee depreciation

3 Best International Mutual Funds to Invest

1. Motilal Oswal NASDAQ 100 FoF:

This is one of the best performer of International Mutual fund category. This fund has been yielding 20% + profits consistently from the last 7 years. Last 1 year the yielding's crossed 50%. Around 99% of its portfolio consists of Equity exposure and the remaining in Cash and money market securities. Top 5 sectors of its portfolio consists Technology, Cons durables, Services, Communications and Healthcare. Apple, Amazon, Microsoft, Facebook, Alphabet are some of the companies in its portfolio. This fund is suitable for high risk appetite investors and who wanted to invest for long term in SIP approach.

2. Franklin India Feeder Franklin US Opportunities Fund:

This is also one of the best consistent performer of its category. Yielding 25%+ from the last 3 years. Total 100% of its portfolio consists of Equity based. Hence, it is riskier when compared to Motilal Oswal NASDAQ 100 Exchange Traded Fund. It is a fund of funds investing predominantly in units of Franklin U.S. Opportunities Fund, an overseas equity fund. It invests in US companies through Franklin U.S Opportunities Fund. This fund provides long term capital gains. The ideal investment horizon is 5 years or more. As it is fund of funds, taxation will be similar to a debt fund instead of any equity fund. In equity funds less than 1 year is classified as short term, while in debt funds less than 3 years it is counted as short term capital gain.

3. DSP US Flexible Equity Fund:

This is one of the good International Mutual fund which invests mainly in companies outside India. This fund will also invests in the units of other similar overseas mutual funds. Around 95% its portfolio constitutes Equity exposure and the remaining in Cash and money market securities. From the last 5 years, the fund is being yielding inflation-beat returns and is most consistent performer in its category. Investors who wanted to take high risk and better diversification can look into this Mutual fund.

Points to Remember While Investing in International Mutual Funds:

1. These funds are best suitable for High Risk appetite investors only.
2. Investors are suggested to invest with long term time horizon and through SIP approach only
3. As these are classified as fund of funds, the taxation will be similar to a debt fund instead of any equity fund.
4. These funds are suitable for portfolio diversification and should not be more than 10% - 15% of your total investment portfolio
5. It’s always better to invest with some professional guidance in the funds which is right for you and not just merely on last year’s performance to make quick bucks.

Disclaimer

This data is for Academic purpose only. The data published on this post is just my opinion based on my own research and analysis and is provided as a general market commentary. As it does not take into account of your personal circumstances, please do not invest based solely on this information. By Viewing any material or using the information within this post you agree that this is general education material and you will not hold any person or entity responsible for loss or damages resulting from the content or general information provided here.

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6 Best High Dividend Paying and Growing Stocks to Invest in India:

(Published on 25-Sep-2020)

Many conservative and Moderate investors generally look for regular income from the stocks. They cannot take high risk and cannot bear the volatility in the Market. For these investors, the dividend paying stocks are the good bet to invest into the stocks. Generally the investors think that the regular dividend paying companies are healthy in terms of finance as well as management. Can we consider all dividend paying companies are healthy? What are the factors we need to look before investing into Dividend stocks? Which are the best dividend paying stocks to invest?

What is Dividend?

Dividend in simple words is the money shared by a company to its share-holders on a frequent intervals based on their profits earned during that time intervals. Dividends can be paid out of the profits earned by the company in the relevant year or previous year. Some times the dividends may include capital profits. It means the sale of assets of the company and these asset profits can be used for paying the dividends.

Why to Choose Dividend Paying Stocks:

1. One can earn regular income from the stocks apart from the value appreciation of stock value.
2. Paying regular dividend is one of the measure of positive health condition of a company.
3. For diversification of one's investment portfolio.

Factors to Consider Before Investing into Dividend Paying Stocks:

1. Not all the companies paying dividends are really good healthy profits. Some companies may borrow the money to pay the dividends.
2. Need to look for the past 5 years dividend track record.
3. Need to check the growth rate and cash flows of the company.
4. Need to check the Line of Business and its future prospectus
5. Need to check the fundamentals and technical analysis factors of the company

6 Best High Dividend Paying and Growing Stocks to Invest:

There are many companies which are paying regular dividends to the share holders. However, we cannot say all these companies are healthy companies. Some of the companies may pay high dividend in the previous year and pay less in the current year. Because of the turbulances in the businesses, their profits may vary every year. Some companies will pay the dividends by borrowing the money from other financial resources. For some companies' Line of Business may not attractive in near future. So, we need to avoid all these factors and to come up with companies which not only having good dividend track record but also fast growing leaders in their respective sectors.

Based on my analysis, the following companies are good for investing which are leaders in their sectors and having good track record in paying high dividends. 

(*CMP as on 25-Sep-2020)

Conclusion:

Investors with long time horizon can invest into the above mentioned stocks through systematic approach. You even reinvest the dividends received from the respective companies to enhance your capital and to meet your financial goals.

Disclaimer:

This data is for Academic purpose only. The data published on this post is just my opinion based on my own research and analysis and is provided as a general market commentary. As it does not take into account of your personal circumstances, please do not invest based solely on this information. By Viewing any material or using the information within this post you agree that this is general education material and you will not hold any person or entity responsible for loss or damages resulting from the content or general information provided here.

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3 Best Mutual Funds to Invest for Children Higher Education

(Published on 16-Sep-2020)

The most important financial goal for every parent in India is children't higher education. Parents dream to see their children on top position in their education as well as their career. So, to give the best facilities like schooling, colleges, materials etc., every parent needs to plan to accumulate large amount of money. Today, there are many child investment plans available in the Market. One such good investment plan is investing in Mutual funds. The traditional investment plans like Bank FDs, Endowment Insurance policies etc. are considered to be safe investment plans, however these investments will not yield inflation-beat returns and may not meet the future expenses for your child's education. If any parent looking for Inflation-beat returns in the long run with calculated risk, then Mutual funds are the best answer.

Which Mutual Funds are Best for Children Education:

During these pandemic situation, the inflation impacted not only on the food and medical expenses, but on the education also. The education expenses has been abnormally increasing 15% - 20% every year, which is higher than the country's inflation. Hence, it is advisable to invest a portion of your investible money in good Mutual funds to beat the inflation and to meet your children's future education expenses. The following 3 are the best Mutual funds for your children's higher education expenses:

1. Mirae Asset Emerging Blue chip Fund:

This is one of the best Large & Mid cap equity fund with consistent inflation beat returns from the last 5+ years. If your time horizon is more than 5 years and you have long-term financial goals like Children's education, then you can think of investing into this Mutual fund. From the last 7 years, it has given 24.84% average returns and it has been in 1st rank in its category from the last 10 years. More than 50% of its allocation is in Large-cap companies and 35% in Mid-cap companies and the remaining small portion in Small-cap companies. Hence, the risk will be comparatively less and stable in long term. The top 5 industries of its portfolio consists of Finance, Technology, Energy, Auto and FMCG.

2. SBI Small Cap Fund:

Though it is more risky fund when compared to Mirae Asset Emerging Fund, but it has been giving decent and consistent returns from the last 10 years. Hence, I selected this fund for any long term financial goals like Children education. As the name suggests, its major portion of assets will be invested in good small-cap companies (67% of total assets) and the remaining in Large & Mid cap companies. Because of the high risk in nature, I suggest this fund to the investors who can have time horizon 7+ years and risk appetite is more. Top 5 sectors consists of Engineering, Services, Chemicals, Consumer Durables and FMCG.

3. HDFC Children's Gift Fund:

This is an aggressive hybrid equity fund, which invests 65% - 80% in Equity and the remaining in bonds. Because of this, the returns are less when compared to the above 2 funds. It has been giving inflation-beat returns since last 10 years. The only disadvantage is, it has 5-years lock-in period for any fresh investments. But, this gives the flexibility to the fund manager to allocate the funds into different portfolios. Those who are having 5+ years of time horizon with moderate risk appetite can look this fund. But if your time horizon is 7+ years with high risk appetite, go for any of the above 2 funds.

Factors to Choose these Mutual Funds:

• All the above Mutual funds are selected with 10 + years of consistent track record
• All the above Mutual funds are giving inflation-beat returns since 10 + years
• All the above Mutual funds are from reputed fund houses
• All the above Mutual funds are suitable for Systematic Investment plan (SIP) approach
• All the above Mutual funds are in 4-star or 5-star rating from the last 10 + years
• All the above Mutual funds are equity diversified mutual funds

Conclusion:

Investments for Children education is one of the most important financial goal for a parent. Hence it is always advisable to look for long term perspective. If you need inflation-beat returns then go for any of the above 3 Mutual funds and invest in Systematic approach for a minimum period of 5 + years.

Disclaimer:

This data is for Academic purpose only. The data published on this post is just my opinion based on my own research and analysis and is provided as a general market commentary. As it does not take into account of your personal circumstances, please do not invest based solely on this information. By Viewing any material or using the information within this post you agree that this is general education material and you will not hold any person or entity responsible for loss or damages resulting from the content or general information provided here.

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7 Useful Money Making Tips to Use this Year

(Published on 12-Sep-2020) 

The recent stock market crash of 2020 had initially put investors in jeopardy and projected an economy where making money would become severely challenging. However, since April 2020, SENSEX had started to move north, indicating a turn. Currently, the market is somewhat at a volatile stage, and investors need to be cautious while investing. 

Several individuals are, thus, on a quest to know how to make money this year and minimize losses. There are several investment avenues that new investors can tap into and expand their savings, irrespective of what their goals are. 

Here Are Few Tips That can Aid in the Process –

Tip 1: Consider Objectives and Goals

Before investing, individuals need to assess their objectives and goals. Some prefer to simply grow their wealth while others invest to meet expenses in the future, like children’s education or wedding, buying a car, down payment for a home, etc. 

Having a set objective and goal enables investors to plan accordingly – they can opt for low-risk schemes for growing their savings, or those with high returns to meet future expenses.

Tip 2: A Certain Degree of Risk is Necessary

Investment options, like deposit plans bearing zero risks, have recently considerably lowered their interest rates. For instance, bank fixed deposits are averaging a rate of interest of 5%. 

As such, for making money this year, individuals need to undertake a certain degree of risk.

Investing in regular or direct mutual funds can be an ideal option in this case. These enable an individual to invest in two ways –

1. Lump-sum – This involves a one-time investment of a sizable amount.
2. Systematic Investment Plan (SIP) – A particular amount is deposited every month.

In this regard, investing in mutual funds bearing moderate to moderately-high risk levels may prove to be lucrative. Large-cap and Bluechip funds can also be the options to go for since these invest in large Indian companies that are financially stable and have not been drastically affected by the recent downturn. 

Investors who want to invest in equities directly, can also look for fundamentally strong stocks. However, in order to invest in stocks investors need a trading and Demat account, which can be created through new age investment platforms like Groww.

Tip 3: Avoid High-Risk Investments

High-risk investments may offer high returns. However, it is advisable to avoid such schemes in uncertain times like these. 

Such investments must only be considered when investors have built a substantial quantum through low or moderate risk products and possess optimal knowledge of the market.

Tip 4: Opt for Short-Term Fixed-Income Schemes

Fixed-income schemes like bank FDs are currently offering some of the lowest rates. As such opting for such plans is surely not one of the brightest ideas to make money under the current scenario. 

However, individuals can easily invest in such schemes for short-term as an alternative to a savings account, which currently offers an average interest rate of 3%.

For those looking to know how to make money investing in fixed-income schemes can opt for corporate FDs. These are offered by financial institutions (other than banks) and companies. One of the drawbacks of corporate FDs is that the minimum investment is usually high.

Few corporate FDs that are offering the highest rates (as of August 2020) now are listed below –

 

Product	Minimum deposit amount	Annual rate of interest
Bajaj Finserv FD	Rs.25,000	6.90%
PNB Housing Finance FD	Rs.10,000	6.65%
LIC Housing Finance FD	Rs.20,000	6.00%

 The above is the minimum rate of interest for cumulative fixed deposits. Non-cumulative FD rates may be lower for monthly, quarterly, and half-yearly pay-outs. 

Tip 5: Review your Investments Frequently

It is essential to keep reviewing the performance of an investment, provided it is market-linked. 

Doing so is particularly necessary in case of stock trading. Stocks may be one of the simple ways to make money online, but investors have to remain cautious at all times.

Individuals will have to remain abreast of the company’s recent developments. Any major changes can affect its stock prices.
Hence, when learning how to make money, it is quintessential to keep reviewing and planning ahead to avoid losses.

Tip 6: Diversification is Essential

Diversifying investments essentially means to invest in several avenues. Doing so is necessary to maintain a balance between risk and return. 

One of the ideal ways to diversify is to invest in –

1. FDs for short-term.
2. Mutual funds and stocks for medium-term.
3. Other fixed-income plans (like PFF) for long-term.

Distribution of money across investments of different risk levels can help individuals to maximize their wealth.

Tip 7: Check the Charges before Investing

This tip may not directly be linked to making money, but it is essential to follow. When buying stocks or investing in mutual funds, investors may need to utilize the service of a stock brokerage company. Such companies usually charge a fee, which may be based on transactions. There might also be other charges involved. Hence, it is necessary to check all the charges of a brokerage company before going forward with it. Keeping all these tips in mind will help those looking to know - how to make money. It is recommended that beginners start small, especially in the case of investments that involve some risk. 

Disclaimer

This data is for Academic purpose only. The data published on this post is just my opinion based on my own research and analysis and is provided as a general market commentary. As it does not take into account of your personal circumstances, please do not invest based solely on this information. By Viewing any material or using the information within this post you agree that this is general education material and you will not hold any person or entity responsible for loss or damages resulting from the content or general information provided here.

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Looking for a New Investment Option - Thought about Leasing vehicles or electronics

(Published on 17-Aug-2020)

If your investment portfolio primarily includes mutual funds, stocks and bank deposits, don’t be surprised, you are not the odd one out but infact 99.7% (Source: Karvy India Wealth Report 2019) of Indian wealth is held in just a handful of investment options. Diversification is a well recognized investment philosophy and now new-age investment platforms are enabling access for everyone to what you may consider very traditional but attractive alternative investment options.

Looking for a New Investment Option - Thought about Leasing vehicles or electronics?

Leasing is one such investment option that provides a great opportunity as you evaluate returns, risks and protection:

1. As an investor i.e. the leasor, you own the physical asset, whether it is a vehicle, a laptop or a machine. Hence in case of any unforeseen event, you can sell it or re-lease it to recover atleast part of your investment
2. You receive monthly income from leasing which means that every month your capital outstanding is reducing. Most likely in the first year itself, 40% of your capital will be returned to you via monthly lease income. You can also reinvest this capital into other investments to earn more returns.
3. The company taking the physical asset on lease also pays you a security deposit before the start of the lease. This is normally 10-15% of your investment and further protects your capital.

What is also important is to evaluate is the company you are leasing to. Some of the questions you may like to get answers to include: 

• (a) how much cash reserves do they have, 
• (b) are their revenues growing, 
• (c) do they have a lot of loans to repay, 
• (d) do they have strong investors backing the company?

Based on our survey of the market and understanding of leasing opportunities currently available, investors can make as much as 20% IRRs on a pre-tax basis. This combination of high returns with managed risk, makes leasing definitely an interesting option for savvy investors to consider.

We know what you are thinking - this sounds great, but won’t finding such opportunities be a lot of effort and won’t the required investment be large? This is where fintech platforms like Grip Invest are changing the landscape and allowing investors to choose their desired investment amounts and follow a completely online and seamless investment process. Some of the largest and fastest growing companies both globally and in India are seeking to lease assets - Ola, Uber are leasing cars, Rentomojo and Furlenco are leasing furniture, Bounce and Zypp are leasing bikes. Such companies are partnering with different online investment platforms and hence are now within your easy reach.

If you end up trying this - write back to us and share your experience! 

Disclaimer

This data is for Academic purpose only. The data published on this post is just my opinion based on my own research and analysis and is provided as a general market commentary. As it does not take into account of your personal circumstances, please do not invest based solely on this information. By Viewing any material or using the information within this post you agree that this is general education material and you will not hold any person or entity responsible for loss or damages resulting from the content or general information provided here.

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5 Fundamentally Strong Stocks to Buy on Good Monsoon Predictions in India for 2020

(Published on 11-July-2020)

The India Meteorological Department (IMD) announced that it expects monsoon rainfall to be normal this year, 2020. The rainfall as a whole is likely to be in the range of 96% to 104%, which is normal rainfall according to IMD. The AccuWeather Senior Meteorologist also predicting the normal monsoon season in India this year.  A good monsoon creates positive perception about the economy among investors, including foreign institutional investors, as a large part of India depends upon agriculture for sustenance. This is definitely a positive sign to some sectors and stocks. Because of the good rains, the rural incomes will rise and create demands to some specific stocks. Though the entire country is facing several issues like Corona, China war, unemployment etc., the Agriculture sector will boost other sectors also. We will see what are the best monsoon stocks that are fundamentally strong stocks to invest for long term.

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4 Best Crowd Funding Platforms in India

Crowdfunding sites are proliferating in India and helping not only the poor but also small scale companies or startups with innovative ideas. These sites are raising the funds on behalf of these Individuals / companies by raising money through bank loans, venture capital, and angel investors involve complicated procedures. These Crowdfunding sites in India are helping innovators launch ideas, social entrepreneurs bring social change and startups raise funds. Most startups, small enterprises, and individuals avoid complex methods of raising funds. Moreover, before raising money, startups have to take into account the different funding stages to decide the mode of raising funds. Crowdfunding is a far easy and less complex model.

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