Dhanteras

This Dhanteras buy 24K Digital Gold and get 5% goldback!

The most awaited season for the celebration is just around the corner. That’s right!
October 25 the first day of Diwali, marks the festival of wealth “Dhanteras”. It is considered the most auspicious and apt day to buy precious metals, especially Gold, as it brings in wealth and prosperity. And why not? Gold investments have delivered upto 20% returns since the beginning of this year.

Though physical gold is the most preferred form of Gold among us Indians, its carries disadvantages such as storage trouble, fear of theft, no yield and high making charges. However, given our traditions and customs, we shouldn’t let go of the tradition of buying Gold on this special occasion, isn’t it?

You can buy this yellow metal and add it to your portfolio by buying it in its safest form with 24K Digital Gold. When you buy Digital Gold, every rupee is utilized in buying only pure gold thereby avoiding the inconvenience of making charges (which is stored in the secure locker from BRINK’s, a global leader in gold custodian services with 100% insurance cover).

Dhanteras offers! Buy gold instantly for as low as Rs. 1000 and get a 5% gold-back. You can also get hassle-free delivery of gold coins/bars to your doorstep with 50% off on delivery and making charges.

Happy Dhanteras from our team at MyWay Wealth!

Get more GOLD this Diwali!

Diwali-Gold

Is It A Good Time To Invest In Midcap And Small cap Funds?

The equity market is never meant to take a straight-line trajectory. It always has its shares of ups and downs based on a number of other factors like the general economic and political conditions within and outside the country, the interplay of global capital markets, movement of the local currency and many other factors.

There are 5000 odd stocks listed on the Bombay Stock Exchange, there is a classification put in place to differentiate between the stocks based on market capitalization. For the uninitiated, market capitalization is the market value of all outstanding shares of a company.

According to changed norms for fund categorization, large-cap funds can only invest in Top 100 stocks by market capitalization, mid-cap funds can choose between the 100-250th stocks and small-cap funds from the 251st stock by market cap.

What Is So Interesting About The Mid Cap And Small-Cap Space?

The Upside of Mid & Small Cap Space

Is it only the market capitalization that makes mid-cap and small-cap space unique and interesting? Of course not!!

Mid-caps and small-cap space represent that universe of the stocks which are budding or has the highest potential for growth. These companies are in their expansion phases and often prove to be value buys. These companies are not very popular so there are a limited number of value seekers investing in this space.

In a phase when the market is growing, the mid-cap and small-cap stocks often perform better than the large-cap stocks due to their potential of growth. Similarly, the mid-cap and the small-cap funds that majorly invest in these companies do well than the large-cap peers.

No wonder there is a lot of interest in this space.

The Downside of Mid & Small Cap Space

The Mid& Small Cap universe has a number of green-horn companies.

While the management of large-cap stocks is seasoned and can better weather a crisis, midcaps and small caps stocks might still be reaching there. Also, these stocks can quickly go down when there is an economic crisis/bear phase in the market.

Therefore investment in this space is not free from risks as these stocks show higher highs and lower lows (volatility).

Although, Mid-caps and small-cap mutual funds are handled by experienced fund managers yet they cannot guarantee you lesser volatility.

Performance of Mid-Caps/Small Caps vis-a-vis large caps

All said and done each one of us looks to maximize our investments. So performance is a key factor.

We looked into the performance of BSE Large Cap 100, BSE Mid Cap and BSE Small-Cap indices over a 5 year period. This is considered as a proxy for Large Cap and Mid& Small Cap funds.

5 year performance of indices

We see that all 3 indices had a common base figure (almost) in 2013. While the index figure for Large Cap is just nearing the double-figure, the Mid-cap and Small Cap indices have moved way past that figure indicating growth in these stocks.

On the other hand, the volatility (ups and downs) for the Mid and Smallcap indices is also much higher when compared to volatility for Large Cap index. For Ex: Consider a one-year horizon from Dec 2017 to Dec 2018, the fall in mid & small-cap indices has been much more than the fall in large-cap, thereby validating our view of higher highs and lower lows.

Takeaways

There is no right or wrong time to invest in any fund. Every fund stands to satisfy a certain need like large caps allow lesser returns with lesser risk and it is the vice-versa for mid and small caps.

The time horizon for holding also matters. Investments in mutual funds generally pay well over longer time horizons.

One cannot totally shun or embrace the mid-cap and small-cap funds. The investments in these funds should be guided by your risk appetite, holding horizon and your financial goals rather than timing the market.

Important update: Recent regulatory changes applicable on Liquid and Overnight Fund

Dear Investor,

This is to update you that SEBI has introduced a graded Exit Load structure for Liquid scheme vide Circular No. SEBI/HO/IMD/DF2/CIR/P/2019/101 dated September 20, 2019. Accordingly, SEBI has decided to implement a graded exit load in all liquid funds w.e.f. October 20, 2019.

The graded exit load shall be applicable on a prospective basis to the following transactions:

  1. All the subscription transactions (including switch-in) processed with NAV of October 21, 2019, and thereafter, irrespective of receipt of application.
  2. All the systematic transactions such as Systematic Investment Plan and Systematic Transfer Plan etc. where registrations /enrolments/installments of existing registrations have been done on or after NAV date of October 21, 2019.

Note: All other features, terms, and conditions pertaining to the schemes shall remain unchanged.
Please find below the grid on graded exit load to be levied on the liquid funds:

exit load

Another, important change for Liquid & Overnight schemes as per SEBI Circular No. SEBI/HO/IMD/DF2/CIR/P/2019/101 dated September 20, 2019, is the change in cut-off timings for applicability of Net Asset Value (NAV) with respect to purchasing of units in Liquid Funds & Overnight Funds with effect from October 20, 2019.

Accordingly, the cut-off timings for the applicability of Net asset value (NAV) in respect of the purchase of units in Liquid Funds and Overnight Funds shall be changed from existing 2:00 p.m. to 1:30 p.m. with effect from October 20, 2019.

Bulls are buying, bears are buying – are you?

Appears that the bulls are back firmly this time – even the one residing abroad. FIIs retained their interest on the back of positive corporate earnings and perceived opportunity in the Indian market. We witnessed constant buying from FIIs this week, which remains the primary reason for sustenance in the uptick.

bull and bear

Key Happenings in the week that went by

Bumper opening for IRCTC:
IRCTC listed with a bumper gain of 100% and closed with an increase of 129%. This is so far the best gain of any PSU IPO and surpassed the 94% listing gain offered by Power Grid Corporation on its listing.

It implies the investors’ interest in the equity market and their bias towards quality and fundamental strength. From the government’s perspective, this precedent can be expected to aid further divestment measures.

What’s in for the investor here:
Strong divestment will help the government ease fiscal deficit which is expected to eventually translate to improved spending on infrastructure.

Strong corporate earnings

HUL Q2 profit increased 21% YoY to Rs 1,848 crore; announces Rs 11 dividend per share owned
Hindustan Unilever reported a net profit of INR.1,848 crore, a YoY rise of 21%.
If we will exclude the corporate tax benefit, the profit figure may come to ~INR.1,832 crore.

Country’s second-largest private sector bank HDFC bank has reported a YoY rise of 26.7% in net profit
Profit after tax for the quarter increased to INR.6,345 crore against INR.5,005 crore earned in the same period last year.

Reliance Industries posts record INR.11,262 crore profit in September quarter
Reliance Industries reported a net profit of INR.1,848 crore, a YoY rise of 18.35%. It became the country’s most valuable company after its market capitalization on market value touched INR.9 lakh crore. Notably, this is the only Indian company to achieve a market cap of such magnitude.

Possibilities of Brexit deal
Britain secured a Brexit deal with the European Union on Thursday, more than three years after the Brits voted to exit the bloc
The deal, however, needs final ratification of the British Parliament, which is a contingent event. Possibilities exist that if the deal may not get the parliamentary nod; in such a case the EU may extend the timeline.

Life ahead – at least in the near term
Indian equities are currently playing catch-up and the sentiment is likely to percolate to stressed sectors. Small and Midcaps are likely to witness buying interest. India’s two respected mammoths & index heavyweights – Reliance Industries and HDFC Bank’s quarterly results will set the ball rolling. Markets witnessed buying from FPIs and DIIs on improved sentiments and better prospects going ahead for the economy and we expect this uptick to sustain till the end of Christmas, at least.
Hence, investors may deploy fresh funds at current levels keeping in mind appropriate diversification and individual risk-taking abilities.

Star Fund

Key Mutual Fund News:
SEBI has accepted AMFI’s graded exit load recommendations for redemptions in liquid funds ; one day holdings would draw an exit-load of 0.007%, two days would lead to 0.0065%, three days would lead to 0.0060%, followed by 0.0055%, 0.0050%, 0.0045% till the sixth day; seventh day onwards there is no exit-load. This will be effective from the 20th of this month.

NFO in Focus: Invest in Kotak Pioneer Fund!

NFO

Festive Offer: Buy gold with as low as Rs.1000

Buy Gold

Here’s what you must know about the week that went by

“In the business world, the rearview mirror is
always clearer than the windshield.”

Warren Buffet

Witnessing a reversal in sentiments, Indian bellwether index Nifty bounced back to a much more favorable level of 11,305 from the previous week’s 11,175-end – up by 1.2%

Key highlights of the week included the following:
-The Union Cabinet raised the dearness allowance to 17% from the previous 12%
This move is expected to cost a total of Rs 16,000 crores to the exchequer and will benefit a total of 50 lakh Government employees and 65 lakh pensioners. This comes in as a surprise as previous increments were in the range of 2 to 3 percentage points.

Expected Impact:
This is the highest ever increase in DA in one go by the central government, we expect this to lend positivity towards the consumption sentiment as the festive season closes in.

– Public sector banks cut lending rates by up to 25 bps.
Banks including Bank of India, Bank of Maharashtra, Central Bank of India, Oriental Bank of Commerce, State Bank of India have reduced lending rates by up to 25 bps following a cut in the repo rate by the RBI last month.

Expected Impact:
With the upcoming festive season, the move is expected to extend the benefit of lower borrowing rates to customers; the auto segment is expected to benefit the most given an already slumped state of sales.
With continually reducing outflows of foreign capital, we can see a reinstatement of faith by the foreign investors and can see them turning strong net buyers soon.
Meanwhile, here are the star fund categories of the week:

return

Here’s how the week’s events reflected in Indian markets

NIfty

We believe corporate earnings will primarily guide market sentiments in the coming week. Hopefully, this earning season will revive domestic investor mood & act as a catalyst in bringing out the bulls in foreign investors.

NFO Alert: Invest in Kotak Pioneer Fund!

kotak NFO

large&midcap

It’s time to invest in this Large & MidCap Fund

The finance ministry’s corporate tax rate-cut gift to India Inc. last weekend was well-received by capital market participants as domestic & foreign investors pumped in the capital in expectation of a spur in the earnings recovery rate. Modi’s visit to the Oval Office is expected to garner positivity for the Indian economy – especially around strengthened trade relations, improved tourism sentiment, and an influx of foreign capital into the home economy.

Having said that, Indian capital markets have been quite resilient in the face of such escalating tensions between two super-economies as it basked in the comfort of an immediate consumption and earnings revival.

Investors are advised to continue investing in a systematic fashion, sticking to asset allocation. If permitted by one’s risk & investment profile, preferences can be skewed towards a large & midcap allocation blend (large-cap orientation) and funds with meaningful exposure to banks, automobiles & IT as sectors.

One such large & midcap fund is “Mirae Asset Emerging Bluechip Fund Direct-Growth.

  • This 5-star rated fund (rated by Morningstar, CRISIL, and Value Research) provides a CAGR of 17.06% (past 5 years), which is 7.59% more than its benchmark (NIFTY Large Midcap 250 Total Return Index @ 9.47% past 5 years) — thus making it the #1 in the Large & MidCap category.
  • This fund provides a perfect blend between large and mid-caps by investing 99.64% in Indian stocks, of which 52.41% is in large-cap stocks, 34.03% is in mid-cap stocks and only 13.2% in small-cap stocks — hence managing the above-average risk it faces.