2. MFs have convinced its target Audience through constantly repeating that they don't have KNOWLEDGE ; TIME, EXPERTISE & EXPERIENCE .
3. KNOWLEDGE : The typical target is a well educated, successful individual who is trying to explore alternative Investment Avenues other than traditional Bank FDs. He/she has investible surplus & has the capability of seeking knowledge easily during these times. Google, anyone ?
4.TIME : However busy anyone could be, surely they can spare half an hour /week to take care of their Investments. And its an exciting way to spend time, Right ?
5. EXPERTISE : There is no "expert" in a dynamic environment like the Capital Markets especially Equity. Expertise comes over time .
6. EXPERIENCE : Only by trial & error can one gain experience. If one needs to make less errors there is no dearth of Knowledge/Experience available on the Social media.
7. First a little bit of History : MFs started in India in 1963 through UTI , Nearly a quarter century later SBIMF came into being. Pvt Sector made its debut through Kothari Pioneer in 1993 & the foreigners came in through Morgan Stanley in 1994.
8. UTI ruled the roost in the early 90's, shady operators were beholden to the CEO (Pherwani), & was involved in the 1992 Scam. Did not learn its lessons & went bust in 1998 resulting in the arrest of the MD.
9. Kothari MF was rechristened as FT which gave the sheen of a Foreign Fund but which continued its shenanigans to this day. When the heat was on the CEO was transferred abroad & the current FM redeemed his family's holdings leaving the investors high & dry.
9. Kothari MF was rechristened as FT which gave the sheen of a Foreign Fund but which continued its shenanigans to this day. When the heat was on the CEO was transferred abroad & the current FM redeemed his family's holdings leaving the investors high & dry.
10. Even in the DOT COM Boom the MFs were in great demand among scamsters since it was easy money. Questionable practices abounded. One Star MF Manager bought K-10 stocks in his FMCG Fund and justified it saying HUL uses technology
11. Something similar to what some funds did in the ZOMATO case & probably are doing in other IPOs too. Zomato's misadventure was ok since it gave them an exit but what about other IPOs which are opening below issue price & what happens after lock in period if the price is lower?
12. While SEBI has been quite diligent in trying to reign in the skulduggery employed by these FMs, it too finds it difficult especially when you have a "Firang" name, they then would cock a snook since India needs FII Investment.
13. Not that everyone is indulging in these games, but there are enough to give the Industry a Bad name & make you feel " Mutual fund Sahi NAHIN Hain"
14. Take the case of NFOs. They convince the retail investor that the Fund is at PAR. This is rampant among Bank sponsored MFs, that investment would be at PAR, they would get better returns then their FD. Here is one example :
15. Remember Max NFOs come when Mkts are overheated
16. Have you ever seen an Insurance Agent aggressively selling Term Insurance or a MF advisor doing it for INDEX Funds. Very rarely, right ? Term Insurance & Index Funds are the most appropriate for an individual. Yet.
17. In terms of returns, studies have shown that most MFs ( 60-75 % ) do NOT BEAT the Benchmark Index. Here is some evidence:indexheads.substack.com/p/the-delusion…
21.DIVERSIFICATION: Studies have shown that an optimal portfolio should have between 15 -20 stocks. For instance Buffet has 82 % in his TOP 10 stocks & his TOP 20 has 93 % , whereas typical Equity MFs have between 50 to 60 stocks 😳. Why ?.
23. CONCLUSION: I was one of the first to get an ARN yet I have not recommended any Equity Funds, only pure Debt funds since DIY is difficult in India since we do not have a well developed Retail Debt market. My advice to prospects is JAGO GRAHAK JAGO . Thanks for the patience.
P.S. This just came in : Mutual Fund Sahi Hain ???
@Jai_hyderabad@vka27 . A thread on Health & Sport. "If I can do it, anyone can do it ". Just like the Stock Markets. Running a Marathon requires the same kind of skill sets as Investing in the Stock Market. Here I am just describing my Running Experience (1/n)
2. In early 2015, when I was around 54 years, the running bug bit me when I saw a friend of mine running on the Marina Beach. He introduced me to Marina Minnals one of the many running groups which are based out of Chennai.
3. In College I was into Sports, mainly short sprints having represented college in various Inter-Collegiate Meets, but anything above 400 m was Hell for me. In 2015 my Running group friends helped me to navigate Hell.
1.“The Dog that Didn’t Bark”
Gregory: “Is there any other point to which you would wish to draw my attention?”
Holmes: “To the curious incident of the dog in the night-time.”
Gregory: “The dog did nothing in the night-time.”
Holmes: “That was the curious incident.”
2.Since 2008, when FED started its QE there was a fear that the wall of Liquidity would lead to very high Inflation, bordering on Hyperinflation.
However, that did not happen flummoxed the best of the minds.
3. In the last one year due to COVID the concept of “HELICOPTER MONEY’ which was touted by Bernanke in the early 2000’s as one solution to take care of low growth. So how is Helicopter Money different from Quantitative Easing?.
1. MY BIGGEST REGRET : Recently on a CH session, a guy asked me whether I regretted my decision to accumulate Dec Put options in end July when Nifty was around 16k. My reply : I never regret my actions made after a great amount of study so long as only I lose money.
2. Regret happens when others take my advice & lose money or don't make money. However in the past have regretted since others took my advice & lost an opportunity.
3. July 2013. Had identified a stock after a great deal of Research, which then was the most hated. Had traded a long time b/w Rs.21-24 & rapidly fell to Rs.18 when it caught my attention. Immediately alerted everyone I knew that it was a bargain for LT. Most believed me & acted.
1. ONE LONE VOICE ...... Q: If a tree falls in a forest, and there’s no one around to hear it, does it make a sound?🙄 Another "rant" in 10 parts.
2. Yesterday, I ranted through 25 Tweets on the current market conditions. Going by the response, the above question assumes relevance. Adding another edition today in the fond hope that some of you may find meaning in what I tried/trying to convey.
3.Had made my observations of the market here on WhatsApp & CH discussions that while its futile to "Catch a top" in terms of Numbers, it may be still a good idea to "time" the market in terms of ... well "Time"
1.A series on 'Bullshit Gyan" spouted by Market Gurus Here is the first one: " Its time in the market that counts, not timing". Think about it : If you do not time the market properly enough, then your time in the market is likely to be not profitable
2. Just imagine buying "Hot Stocks" like Brokerage ones just last month. All of them are down anywhere between 20 - 30 %. And the honchos of those esteemed brokerages would tell you that a return of 20 % is great in the Stock Market 🙄
3. Or look at "Hot Sectors" like Metals. They have not fared any better. They are overbought even at these levels. So much for Multi year Commodity Bull run nonsense spouted by Strategists.