Invested in equity mutual funds in recent time and the values are now down, here are few observations:

Short-Term Perspective (Less than 6 months)

1. Avoid Panic Selling: Refrain from selling investments during a downturn, as this can lead to locking in losses.

2. Stay Invested: Ride out the volatility, and consider the current downturn as a temporary correction.

Medium-Term Perspective (6 months to 2 years)

1. Rupee-Cost Averaging: Continue investing a fixed amount of money at regular intervals, regardless of the market's performance.

2. Rebalancing: Review the portfolio and rebalance it to maintain the original asset allocation.

Long-Term Perspective (More than 2 years)

1. Time in the Market: Remember that equity investments are long-term in nature. Historically, equity markets have provided higher returns over the long term.

2. Rupee-Cost Averaging: Invest a lump sum amount in a staggered manner to reduce the impact of market volatility.

3. Tax Efficiency: Consider the tax implications of selling investments. If the investment is held for less than a year, the gains will be subject to short-term capital gains tax.

Additionally 

1. Review and Adjust: Assess the investor's risk tolerance, investment horizon, and financial goals. Adjust the investment strategy accordingly.

2. Diversification: Ensure the portfolio is diversified across asset classes, sectors, and geographies to minimize risk.

3. Professional Advice: Consult with a Mutual fund distributor, financial advisor or a registered investment advisor to get personalized advice.

By following these observations, investors can navigate the current market downturn and make informed decisions to achieve their long-term financial goals.

Please Note Views are Personal

I am here to assist you with all your mutual fund investment service needs. 

Please feel free to contact me.

Regards,

Ritesh Sheth CWM®

(Chartered Wealth Manager)

Amfi registered Mutual fund distributor under 

ARN-0209 EUIN- E030691.

ARN Date of initial registration - 16-AUG-2002 Current validity of ARN up to - 01-Oct-2027.

Disclaimer:

Mutual fund Investments are subject to market risk please read the offer documents before investing.

The schemes/services/offers/products provided on this message do not constitute an offer to sell or buy of mutual fund for units/products to any person. It shall be the sole responsibility of the person to verify genuinely of such information whether the usage of this and/or availing the services/facilities/products is in conformity with personal understanding.

Stay Ahead of Market Volatility with SIPs & Additional Purchases

"Ride the Market Waves with SIPs"

When markets dip, don't lose your grip,

Your SIP (systematic investment plan) invests, and your wealth starts to rip!

Each month's low, a smart buy for you,

More units gathered, less volatility to pursue.

When markets soar, units may be few,

But past investments shine, with returns anew!

Old purchases, now a treasure to see,

Compounding wealth, in a grand legacy.

Falling trends? A hidden opportunity,

Long-term SIPs, a promise of prosperity!

Patience and faith, your guiding lights,

Market dips, a stepping stone to new heights!

So invest steadily, don't let fear take hold,

History proves, markets rebound, young and old!

With SIP's steady hand, and a wise, long-term view,

Your wealth will rise, and your dreams come true!

Seize the Opportunity

When markets are low, consider investing a lump sum to maximize your returns. This strategy can help you:

- Buy more units at a lower price

- Reduce your average cost per unit

- Potentially earn higher returns in the long run.

Happy Investing!

Start your SIP journey today or invest a lump sum to make the most of the current market conditions. Contact me to learn more about SIPs and how they can help you achieve your financial goals.

Best regards,

Ritesh Sheth

CWM® (Chartered Wealth Manager)

Amfi registered Mutual fund distributor

ARN-0209 | EUIN- E030691

Disclaimer

Mutual fund investments are subject to market risk. Please read the offer documents before investing. The schemes/services/offers/products provided on this message do not constitute an offer to sell or buy of mutual fund for units/products to any person.

Please verify the authenticity of this information before taking any investment decisions.

The Union Budget 2025

The Union Budget 2025 aims to accelerate growth, secure inclusive development, and invigorate private sector investments. The budget focuses on seven key areas: agriculture, MSMEs, investment, exports, villages, youth, and women.

*Key Highlights:*

- *Agriculture*: The government plans to increase agricultural productivity through the Prime Minister Dhan-Dhaanya Krishi Yojana, which will cover 100 districts with low productivity.

- *MSMEs*: The investment and turnover limits for MSMEs will be enhanced to promote growth and employment.

- *Investment*: The government will invest in people, economy, and innovation, with a focus on education, healthcare, and infrastructure development.

- *Exports*: The government aims to promote exports through various initiatives, including the establishment of a National Manufacturing Mission.

- *Villages*: The government will focus on rural development through initiatives such as the Jal Jeevan Mission and the Rural Prosperity and Resilience programme.

- *Youth*: The government will invest in education and skill development initiatives to promote youth employment and entrepreneurship.

- *Women*: The government will promote women's empowerment through initiatives such as the Bharatiya Bhasha Pustak Scheme and the National Institute of Food Technology, Entrepreneurship and Management.

Additionally:

- Increased Basic Exemption Limit New Tax Slab.

- Standard Deduction Increase.

- Increased Tax Rebate Limit.

- Direct tax code.

- Boost to Consumption.

The Union Budget 2025-2026 should improve economic and market sentiments in an uncertain global order and boost investor confidence. Despite short-term market volatility, robust fundamentals make India a promising opportunity for long-term investors. 

Introduced policies designed to promote long-term growth and sustainability in critical sectors such as agriculture, infrastructure, energy, healthcare, and technology. 

By aligning with these growth themes, investors can potentially benefit from rising opportunities in the stock market and mutual funds providing lucrative options for investors seeking exposure to India’s evolving economic landscape.

*Aggressive equity fund Investors* : may look to mutual funds focusing on small-cap and mid-cap funds as well Sector funds like infrastructure, clean energy, FMCG,banking and financials are expected to outperform.

*Moderate equity fund Investor*: may look to mutual funds focusing on Flexicap funds and multicap funds with a mix of sector funds.

*Conservative equity fund Investor*: may look to mutual funds focusing on Dynamic asset allocation funds with mix of large cap funds , large and midcap funds and flexicap funds 

*Please Note Views are Personal*

I am here to assist you with all your mutual fund investment service needs. Please feel free to contact me.

Regards,

Ritesh Sheth CWM®

(Chartered Wealth Manager)

Amfi registered Mutual fund distributor under 

ARN-0209 EUIN- E030691.

ARN Date of initial registration - 16-AUG-2002 Current validity of ARN up to - 01-Oct-2027.

Disclaimer:

Mutual fund Investments are subject to market risk please read the offer documents before investing.

The schemes/services/offers/products provided on this message do not constitute an offer to sell or buy of mutual fund for units/products to any person. It shall be the sole responsibility of the person to verify genuinely of such information whether the usage of this and/or availing the services/facilities/products is in conformity with personal understanding.

What is the benefit of staying invested in the long term?

Invest for long term – an advice routinely given by many Mutual Funds distributer like me, This is especially true in case of certain Mutual Funds – such as equity and balanced funds.

Let us understand why the professionals give such advice. What really happens in the long term? Is there a benefit of staying invested for long term?

Consider your Mutual fund investments as a good quality batsman. Every good quality batsman has a certain style of batting. However, each good quality batsman would be able to accumulate lots of runs, if he continues to play for years.

We are talking about the record of a “good quality” batsman. Every good batsman would go through some good and poor performances. On average the record would be impressive.

Similarly, a good Mutual Fund would also go through some ups and downs – often due to factors beyond the control of the fund manager. An investor would benefit if one stays invested through these funds for long periods of time.

So, as long as you can afford, stay invested for long periods of time – especially in equity and balanced funds.

How am I reading the situation?

I have been expecting volatility in the markets. In the last 6-8 months, i have been advising to be cautious with our asset allocations while i am keeping a razor sharp focus on improving the overall quality & risk-reward of our investment portfolio.

Markets are never static and always have a significant emotional quotient. I understand that and try to navigate risk and returns continuously across the continuum of the cap curves and sectors available. 

Young investors entering the equity markets for the first time also heightened the bullishness in the market. 

Mutual funds have been asked to monitor the liquidity profile of their portfolios carefully and come up with strategies to counter sudden liquidity

issues that may arise.

Macro backdrop for corporate India has never been more favourable. With India’s fiscal deficit and current account deficit under check, capital

costs continue to remain benign.

Corporate India has a good balance sheet and with the Make in India campaign, we are witnessing a recovery

in manufacturing, which favours midcaps and small caps more as they tend to supply global vendors from here. 

Multiple indicators were endorsing the fact that from a medium-to-long-term perspective, value stocks, which had so far traded in the neglected territory, will now be market outperformers in absolute as well as relative terms. any further up move and this outperformance would eventually signify preference for value stocks. According to my reading multiple indicators are now pointing to an amplification of the value thesis at a much larger scale as we are at an inflexion point. I am now seeing that the stocks in admired territory are undergoing a correction, while stocks in neglected territory are seeing a rise in valuations.

My understanding is emphasizing that this trend will perpetuate going forward.

I would like to

⇨ Add more to the investments during corrections as it helps in higher returns, when market (/ Portfolio) recovers.

⇨ During corrections, instead of Timing the Low, which is near impossible, plan your investments in a staggered manner for certain %-age of correction.

⇨ Keep a SIP … it really helps in building your goal-kitty and wealth over years.

⇨ Asset allocation plays a vital role in the larger scheme of things.

⇨ Rebalance the allocation in times of need (like a sharp rally in equities, deep correction in markets, other assets, etc).

Please call me for detailed discussion and investment opportunities.

*Views are personal & not for any recommendation/endorsement.*

Happy investing!!

Regards,

Ritesh Sheth CWM®

(Chartered Wealth Manager)

Amfi registered Mutual fund distributor under ARN-0209 EUIN- E030691.

ARN Date of initial registration - 16-AUG-2002

Current validity of ARN upto - 01-10-2029

*Mutual fund Investments are subject to market risk please read the offer documents before investing.*

Investments in India for NRIs in USA/ CanadaIndian

NRIs based out of US and Canada can invest in Indian mutual funds. However, AMCs do not have a uniform policy to deal with US and Canadian clients.

Currently, close to 14 fund houses receive investment from investors based out of these two countries and another five AMCs receive investment only from US.

Broadly, there are two categories of fund houses here - where investors are not required to physically present in India and vice versa.

Here is the list of fund houses where investors are not required to be physically present in India:

Aditya Birla Sun Life Mutual Fund

Nippon India Mutual Fund

Quant Mutual Fund

Sundaram Mutual

UTI Mutual Fund

Interestingly, these fund houses allow such NRIs to invest in their MF schemes without any restriction that too through online transaction.

Let us look at the fund houses which insist NRIs to be physically present in India:

360 One Mutual Fund

Axis Mutual Fund

DSP Mutual Fund (Only lumpsum)

ITI Mutual Fund (Only lumpsum)

Kotak Mutual Fund

Navi Mutual Fund

NJ India Mutual Fund

PPFAS Mutual Fund

SBI Mutual Fund

Taurus Mutual Fund

White Oak Capital Mutual Fund

Similarly, here is the list of fund houses, which receive money only from US investors:

Bandhan Mutual Fund (Only US)

Edelweiss Mutual Fund (Only US)

HDFC Mutual Fund (Only US)

ICICI Mutual Fund (Only US)

Motilal Oswal Mutual Fund (Only US)

Please note that all these fund houses receive investment only through physical mode. 

Also, these fund houses insist NRIs to submit application form along with a declaration form indicating their residential status.

NRIs residing in US and Canada will have to share Foreign Account Tax Compliance Act (FATCA) details and tax identification number (TIN) along with KYC details.

FATCA declaration form captures information like type of address (residence, business, registered office etc.), country of tax residence, tax identification number, Global Intermediary Identification Number (GIIN) and seek investors consent for sharing the information with relevant tax authorities.

For KYC, 

NRI needs to be physically present in India for KYC.

here is the list of valid KYC documents:

PAN card

Overseas address proof

Passport

Passport size photograph

OCI Card (In case of foreign passport holder)

For transaction, an NRE (Non-Resident External) or NRO (Non-Resident Ordinary) account is a must.

Hope i have addressed Common questions/query receivedfrom US and Canadian NRI. 

Please note this blog is on the basis of best efforts basis. Request reader please connect with your financial advisor or mutual fund companies for proper guidance.

Regards 

Ritesh Sheth CWM®

Disclaimer:

The views are for personal use and for educational propose only. Ritesh Sheth & Family or Tejas Consultancy does not guarantee the accuracy, adequacy or completeness of any information in this emailer and is not responsible for any errors or omissions or for results obtained from the use of such information.

This BLOG is addressed to and intended for the investors of Ritesh Sheth & Tejas Consultancy only. You are advised to contact Ritesh Sheth & Tejas Consultancy to clarify any issue that you may have with regards to any information contained in this blog. Ritesh Sheth & Family or Tejas Consultancy does not have any liability to any person on account of the use of information provided herein and the said information is provided on a best effort basis. In case of investments in any of our schemes, please read the offer documents carefully before investing. 

Exit strategy is a less discussed topic for mutual funds

While investing in Mutual Funds, Investors take various factors in consideration, like when to buy, what to buy, how much to buy etc. However, a less discussed topic is an exit strategy. 

Ideally, an investor should exit mutual fund investments on completion of financial goal apart from that, there are four other scenarios when an investor should exit MF investments.

In fact, for long-term investments, he/she should start exiting equity-linked MFs when the goal is still 2 to 3 years away and shifting the funds to safer investment options. 

But things don’t always happen, the way they should. The same is true for investments and hence, one needs a well-sounded exit strategy. 

Apart from what one should do in an ideal situation, four other scenarios when an investor should exit MF investments:

• When the mutual fund deviates from its stated mandate and takes undue risks that it is not supposed to take.
• The mutual fund is unable to deliver consistent fund performance over a full market cycle of under five years.
• When your asset allocation merits you to rebalance between asset classes.
• When you need money.

In such cases, here are the exit strategies an investor should follow:

When the mutual fund deviates from its stated mandate and takes undue risks

A classic example for this would be Franklin Templeton. The company had to wind up 6 of its mutual funds in debt category in April last year simply because it took more risk than its stated mandate. 

The AMC took exposure in bonds with high credit risk to generate high return. As much as this strategy might work wonders for longer term investments, the company took this risk for short-term debt funds. 

Though these funds were able to provide high returns before the pandemic based on this strategy, in the post-COVID era, as redemption requests increased and the bonds became illiquid, unable to manage the pressure, the AMC had to wind up its funds. 

The mutual fund is unable to deliver consistent fund performance.

A fund can be called as an underperformer if it has delivered say 5% or 6% in 2-3 years. “It may be that the market too delivered the same. Not your fund’s fault. 

Also, if a fund has been steadily behind the benchmark for 3 or more quarters by 3-6 percentage points or more, it is again an underperformer.

Then, you need to see if this has to do with the theme/strategy itself. For example, a value fund might not be performing well in the Nifty 50 but, the situation might be as such that other value funds are also at the same level. In that case, compare it with similar funds to know if your fund is a poor one among the other underdogs. “It is a different call if you choose to exit a strategy. That is more about your portfolio requirement and less to do with the performance of the fund."

What should be the exit strategy for the above-mentioned cases.

If your fund has been underperforming or shifted from its stated mandate, you should first stop the SIP. And, start the same in similar funds in your portfolio or choose a better one. 

“If you simply stop with the above, it is likely that over a period, you will be left with an unwieldy portfolio."

When your asset allocation merits you to rebalance between asset classes. 

For an effective investment plan, one needs to rebalance his/her portfolio periodically. It is done by selling/exiting investments in overpriced asset classes and investing in underpriced ones. Rebalancing portfolio helps the investor to generate higher return and at the same time de-risk the assets.

How to decide which funds to sell?

When you are rebalancing and you have multiple funds from the same category or style, exit the funds that are performing average first, if there are no funds that are underperforming. 

Reinvest in funds that you like/favour in your portfolio and if there are none, the nearest fund in terms of risk profile. 

For example, if you had a large and midcap fund and you would rather exit it to consolidate, you can well consider investing in a multicap fund. It may be marginally less aggressive but there’s no point adding a new fund since your aim is to consolidate. Else, split it between a multicap fund and midcap fund that you already hold.

When you need money.

No matter how prepared you are for the rainy days, there can be emergency situations when you might need to sell your mutual fund investments from the long-term portfolio.

How to decide which funds to sell?

Under such circumstances, the funds in the underperforming and performing average categories should be your first choice.

Many of you use the argument that you will book profit in the performing fund first. But you need to remember that MFs are not stocks. A stock that has gone up becomes expensive. A mutual fund that has returned well, may continue to return well as it rejigs its portfolio to find newer opportunities. Track record of consistent performance is more important. The exception to this is sector/theme funds.

However, there is no one correct answer to when one should exit a mutual fund, it depends on various factors.

 “It's a function of investor time horizon, risk appetite and the purpose of investment." 

An Investor Education & Awareness Initiative

          Mutual Fund investments are subject to market risks, read all scheme related documents carefully.