wsx asked, I got house in other city bought on home loan. It is locked and no one is staying there. How much home loan interest is exempt in such case? Do I need to show fair rent even if it is not rented?
Naveen Chopra answers, In case of self-occupied property, there is Rs.150000 cap on interest that can be claimed. In case if the property is not self-occupied, than whatever interest is paid by you can be claimed. Regarding fair rent, it needs to be disclosed only if the proerty is not claimed as Self-occupied. In your case, if you do not have any other property in your name, than you can claim the same as Self-Occupied.
________________________________________
awer asked, sir i have a home loan , but do not have a component on hra in my salary .can i claim a deduction under 24c for home leoan interest paid
Naveen Chopra answers, You can claim Interest paid on Home Loan irrespective of the fact whether you have HRA as component of your Salary or not. Interest is cliamed under section 24(b).
________________________________________
hllo asked, On the gift I give to my wife and the income is generated on that by investing it. What will be tax implication? Will it club to my income?
Naveen Chopra answers, The income generated will be clubbed with your income and you will be paying tax on such income.
________________________________________
souz asked, Is profit from sale of shares to be included while filing returns? What if there is also a loss from sale of shares?
Naveen Chopra answers, Profit from sale of shares can either be short term or long term. If the profit is short term it is taxable and hence the same should be included while filing returns. Same is the case with the loss, as the same would be either adjusted against current years profit or carried forward to next year. As far as Long term profit is concerned, although the same is exempt from tax, it is advisable to dicslose the same under Exempt Income category. As regards loss, if the net result after adjustment is loss, you can ignore the same as it cannot be carried forward.
________________________________________
debasish1 asked, I have constructed a house with housing loan in my workplace, my spouse is staying in other state in rented house. She is not having any income. Can I claim both houseing loan and rent while calulating tax liability?
Naveen Chopra answers, If both the house are in a separate state and it is difficult to travel to your self onwed house on a day-to-day basis, you can claim tax benefit for HRA as well as for home loan.
________________________________________
def asked, Can property tax paid for self occupied home can be shown and minus-ed against income in ITR-2.
Naveen Chopra answers, You cannot claim any such deduction.
________________________________________
vinayc asked, I just got to know that i filed my last year tax returns for the wrong assessment year. I filed them for Assessment year 2007-08 but i should have actually filed for the year for 2008-09. Please suggest what can i do now.
Naveen Chopra answers, Refile for A.Y. 2008-09 at the earliest.
________________________________________
Mandar asked, If I decide to move to a rented apartment what is the maximum House Rent that I can claim is Rs.36,000p.a only ?
Naveen Chopra answers, There is no maximum limit specified for House Rent allowance. As a gerenal rule, your HRA should be 50% of your basic salary.
________________________________________
Raman asked, I got a form16 'A' from ICICI bank for tax they deducted. Do I need to add that to my return?
Naveen Chopra answers, Yes. ICICI bank has given you a certifiacte for the amount of tax they have deducted from the income that was credited to your account. the tax has been deducted at a concessional rate of 10%. while filing income tax return, you will have to disclose the amount mentioned in the certiifcate as income and claim tax concession for tax already deducted and paid on your behalf.
________________________________________
perminder asked, Besides my regular work, I also do some freelancing. Do I have to show it as other income?
Naveen Chopra answers, Certainly, it is your income and you have to disclose all the income earned during the year, however small it may be.
________________________________________
vinoda asked, Is it mandatory to file before 31st July? Can I file after 31st July ? upto what date I can file the return?
Naveen Chopra answers, You can certainly file your return after 31st July also. However in case your tax calculation results in additional tax liability, you will have to pay penal interest @1% per month for late filing of return. Further if there is any unadjusted loss, you won't be able to carry forward such loss to subsequent years. Further if you file your return after 31st March of next year, you can even be liable to pay penalty of Rs.5,000/-.
________________________________________
Jai asked, I have a query.. i have purchased a new house. the old house would be on rent. would it be possible to show the rent on my wife name and claim deduction for the new house from my tax?
Naveen Chopra answers, Presumably the old flat is in your name. If that is the case, any income generated from such flat will be your income and this cannot be shown as rent income of your wife.
________________________________________
Suvam asked, I am paying LIC premiums for my father who is retired and dependent on me. Can I submit those receipts for my tax exemption?
Naveen Chopra answers, No, you cannot. You can claim deduction for premium paid only for self, spouse and children.
________________________________________
vinoda asked, apart from 1 Lakh, can I exemption for Mediclaim under 80c and 80d, what are limits
Naveen Chopra answers, Apart from Rs. 1 lakh deduction u/s 80C, you can additionally claim deduction for Medical insurance premium paid. The limit for claiming deduction is as under - Premium paid for self, spouse and children - Rs,15,000/- or actual premium paid, whichever is less. Premium paid for parents - Rs,15,000/- or actual premium paid, whichever is less. If parents are senior citizens, the limit of Rs. 15,000/- is extended to Rs.20,000/-
________________________________________
Meher asked, While filing returns, do we also need to show mutual fund dividends?
Naveen Chopra answers, Mutual fund dividend is exempt from tax and hence does not affect your tax calculation. However you should disclose the same in the income tax return, as a separate area is provided in the income tax return.
________________________________________
Jule asked, I live in a rented flat and get HRA. In June 2008, I booked a house (still not ready) with a home loan. Can I claim the HRA as well as benefits from the home loan?
Naveen Chopra answers, Since the house is under construction, you cannot claim home loan benefits. This can be available from the year you get then possession of the property. Till then enjoy the benefits of HRA exemption.
________________________________________
hhhh asked, hi, can i file my return now?
Naveen Chopra answers, Certainly. You can file your income tax returns till 31st July. So hurry up and file your return.
Showing posts with label QUESTIONS AND ANSWERS. Show all posts
Showing posts with label QUESTIONS AND ANSWERS. Show all posts
Thursday, July 30, 2009
Wednesday, July 29, 2009
INVESTING EXPERT MRINAL PARVATKAR REPLIES TO QUERIES
________________________________________
abhinavs asked, do u think for starters SIP would stand out to be amongst a few good options to invest...???
Mrinal answers, hi, yes for investors begining to invest for the first time, SIPs are the best way of investing. Build a portfolio of well managed funds with track record of atleast 3-5 years to show for
________________________________________
shk asked, hi i am self employed person monthly i can save between 5000 to 10000 i have 2 kids i want to save for there future where and how should i invest plz ans me hi i am self employed person monthly i can save between 5000 to 10000 i have 2 kids i want to save for there future where and how should i invest plz ans me hi i am self employed person monthly i can save between 5000 to 10000 i have 2 kids i want to save for there future where and how should i invest plz ans me
Mrinal answers, hi, the answer to your question lies in making an comprehensive investment plan made for you. The investment plan will precisely tell you how much to invest for each financial goal and in which ivestment instrument
________________________________________
subrat asked, I am a salaried employee, i am planning to buy a home but only after 3 years. What kind of investments do you think will be suitable for me so that I can use the money saved for my home but at the same time not let the money lie around idle.I can save about 10 to 15 thousand per month
Mrinal answers, in my view you can consider investing in MIPs from mutual funds. HDFC MIP - Long Term is among the better performing MIPs
________________________________________
tst asked, Sir I invested in following MF through SIP. Pls suggest can continue same for long term DSP BR TIGER, HDFC growth, Sundaram Select focus, DSP ML Equity growth.
Mrinal answers, hi, you have a good portfolio of mutual fund schemes.Continue with your SIPs.
________________________________________
MyMoney asked, Please sugget some tips on how to select a Pension fund. I can invest around 35-40K per year. Is LIC worth looking at?
Mrinal answers, hi, Pension plans help you meet your post retirement needs. It is important to have a retirement plan in place before taking any pension plan. In my view, invest in a mix of equity funds and debt rather than taking a pension plan.Build a retirment corpus adequate enough to generate regular income every year post retirement
________________________________________
investor asked, I have a certain lumpsum amount for which I need capital protection. Is it a good idea to invest lumpsum in debt oriented MIP and invest the monthly income in good equity diversified funds? If not can you suggest a better alternative?
Mrinal answers, hi, sounds like a good idea. I would recommend that you opt for quarterly dividends as agianst monthly in case of MIPs
________________________________________
madanchikna asked, Hi Mrinal, I am a salaried person having monthly intake of 60k after cutting taxes . I want to buy one 2BHK of cost around 30L ,where to invest my money and how to invest? can u please guide me .. thnx in advance
Mrinal answers, hi, The selection of investment option will depend on when you need the money i.e no of years to buying your property. If your investment period is less than 3 years, fixed income instruments like FDs will be the ideal. In your case capital preservation is important compared to returns.
________________________________________
narah asked, Mrinal, Your point about ULIPs is good, in fact I also planned to invest in term plans and MFs for future. However I have already invested around 1.5 lakhs in ULIPs over the last 3 years. Should I close all those and invest in MFs and equities and take a good term plan?
Mrinal answers, hi, After your mandatory investment of 3 years, do not pay further premium. Rather invest in mutual funds.
________________________________________
abhi asked, Please rate these NFO, I want to invest either of them through SIP for 3 years 1. JPMorgan JF Greater China Equity Offshore Fund 2. DSP BlackRock World Energy Fund 3. Canara Robeco F.O.R.C.E Fund 4. Kotak Select Focus Fund Please suggest Thanks Abhishek
Mrinal answers, hi, in my view your portfolio is not very healthy. You have all the thematic funds in your portfolio. I would recommend that you redeem you entire portfolio and invest in well managed diversified equity funds with a track record of atleast 5 years.
________________________________________
GetMore asked, I m a 44 yr old, can save max 5 k per month, interested in retirement solutions, but return on pension scheme is very nominal. Planning to invest in MF for approx 14 yrs. Your Opinion required
Mrinal answers, hi, in my view pension plans are expnesive and may not be the ideal way to plan for retirement. I would suggest that you take help of a financial advisor to get a retirement plan made for you and then invest in line with your retirement plan
________________________________________
raj asked, Madam, for my 2 yr old son what do u suggest a MF with SIP or insurance as i dont want returns till 18 yrs. I already have his Max new york life insurance, savings a/c , kids a/c &FDs
Mrinal answers, hi, to plan for your child's future expenditure like higher education / marriage, get an investment plan made. The investment plan will help you decide how much money you will need after 18 years, how much should you invest every month and which products so that you have the right amount of money at the right time.
________________________________________
Mani asked, Hi, what will happen if we stay invested for long years (say 20 years , 15 years..) in a mutual fund? eg a amount of rs 10000 in a good mutual fund for that many years. Is that a good strategy.
Mrinal answers, hi, yes 15 years is a good time for investing in equities. If you invest Rs. 10,000 in equities for 15 years and if you money grows at the rate of 15% p.a. over 15 years, your investment of Rs. 10,000 will grow to Rs.80,000 (approx). Yes, its a good idea to invest in equities for 15 years but do not forget that your investment is in line with your asset allocation and risk appetite
________________________________________
Rajeev Sharma asked, Hi Mrinal, Can you throw some light on taxation related to short term and long term gains on both equity and debt funds. Also, I have about 6 months expenses as a contingency fund of about 6 lakhs - all in Bank FDs. Given the low interest which they are fetching does it make sense to move them over to debt mutual funds. Thanks for your answer.
Mrinal answers, hi, i have discussed the taxation of mutual funds earlier in this chat. Regarding moving money from FD to debt funds, you need to understand that while FDs offer fixed assured returns debt fund returns are market linked. Technically speaking debt funds can give negative returns if the interest rates in the economy move up. Given today's economic scenario and the fact that its your contingency fund, I would not advise you move out of FD
________________________________________
Pari asked, How abt investing 1 lac in short term and then keeping rotating this money in the market in stokcs?
Mrinal answers, hi, I would not recommend equity investment for investment horizon less than 3 years. While it make seem easy to make money from stock market while the going is good do not forget the fact that equities investments carry maximum risk. A stock can fall 20% in one day and if it is because the company's fundamentals are bad the loss could be permanent. Hence invest in good company shares with long term horizon of atleast 3 years
________________________________________
LAKSHMINARAYANAN asked, Which diversified fund can be invested now for monthly SIP for Rs.2000/- each for 3 MF and time horizon of 10 years
Mrinal answers, hi, you can consider investing in funds like Franklin India Bluechip, HDFC Equity and DSP BR Top 100 Equity Fund among others
________________________________________
beakrishnan asked, i am a retired personal and have something atlast to invest- FDs rates are very marginal now a days. I am not interested in investing in risky stock market - can you advise me suitably as to where can i invest this little sum of mine?
Mrinal answers, Dear Sir, it is true that interest rates are low and the options are few. You can consider investing in Senior Citizens scheme that offers 9%. The maximum investment in this scheme can be upto 15 lakhs. Bank Fds are the next option to choose from.
________________________________________
narah asked, Mrinal, Are all ULIPs bad according to you?
Mrinal answers, hi, ULIPs charge are high for the first 3 years. In a normal scenario the it take at least 10 years for the ULIPs to recover the initial costs. Consider a combination of term plan and mutual funds over the ULIPs
________________________________________
tst asked, Hi sir, what about Rel infrastructure fund and DSP ML world power fund(NFO)
Mrinal answers, hi, these are thematic funds that offer higher return for higher risk. The fund is dependent on the performance of the sectors that form the theme. The fund manager does not have the flexibility to invest in sectors that do not form a part of the theme. In a situation where the underlying sectors are not doing well the fund manager has no choicd but to stay invested in the same. Hence, investors who are sure of the future performance of the sector and who can time their entry into and exit form the sector can consider investing in these funds. It is better to look at diversified equity funds that can invest in any sector that the fund manager finds attrative from returns point of view.
________________________________________
sandeep asked, Is it good to go for term insurance for financial security? which plan is best and exact amount to go for at age of 30 with one child?
Mrinal answers, hi, as far as insurance is concerned the ideal option is term plan. Do not go for endowment, money back or ULIPs. Term plan offer only risk cover and you get the benefit of higher sum assured for lower premium. I would adivse you to calculate your human life value (HLV) and then decide the sum assured for your term plan.
________________________________________
123 asked, hi, I there any plan to invest Rs. 5000/month for 15-20 years to get better returns.
Mrinal answers, hi, for investment horizon of 15 years equities are the best investment opiton. However, you should keep in mind that stock markets are volatile and equity investments carry maximum risk. The longer you stay invested the higher the chances that you will make goo returns
________________________________________
qwerty asked, query on sips - irrespective of the fact that an sip is started earlier to august 09 , will entry load be deducted ? if so why as each sip is treated as a fresh purchase . please give ur opinion .
Mrinal answers, hi, the SEBI circular says that all equity oriented fund SIPs registered prior to 1st August 2009 will be charge entry loads till the last instalment is invested. In other words,all SIPs registered after 1st August will be not be charged any entry load
________________________________________
dfdd asked, Is there any income tax obligation for long term investments (more than 1 year) in stocks or mutual funds? What percentage of the returns would be taxed? What if I have a loss on the investments?
Mrinal answers, hi, if you are investing in equity and balanced funds then there is no long term capital gains tax if the investments are redeemed after one year. In the case of debt funds, the long term capital gains tax would apply. It will be 10% without indexation and 20% with indexation whichever is lower. If there is a long term loss on equity funds then the same cannot be adjusted against the long term capital gains. In the case of Long term capital gains from debt funds, the long term loss can be set off against long term gains
________________________________________
qwerty asked, sir i am in mid 30's and wish to invest in mutual funds . i have read about investement in index funds and etfs . what are these and how are they better than active funds. are they worth investement and what proportion of my amount should i invest . if recommended which are the ones which are recommended .
Mrinal answers, hi, index fund invest in stocks that constitute the underlying index and in the same proportion. The fund manager has no choice to invest in stock other than those that form a part of the index. Hence it is known as a passive style of management and the expenses are low compared to actively managed funds. In India, non-index based diversified equity funds have outperformed the popular index like Sensex and Nifty. Hence, if you are considering investing in index funds do not allocate more than 20% of your overall equity portfolio to these type of funds
________________________________________
qwerty asked, how is franklin felxicap ? should we exit and enter franklin bluechip
Mrinal answers, Hi, Franklin Flexicap can invest across stocks with any market cap as agains Bluechip which can invest only in large cap stocks. If you are willing to take risk of investing in large and midcap stocks then Flexicap is ideal or else switch to Bluechip Fund
________________________________________
rites asked, hi, Mrinal my salry is 9000/-pm i can save 4 to 5k p.m. which saving plan is best for me pls suggest
Mrinal answers, Hi, I would advise that you invest your monthly savings in line with your investment goals and risk appetite. For e.g your investment goal can be retirement and if retirement is 10-15 years away then majority of your savings can be invested in equities and the balance in debt
abhinavs asked, do u think for starters SIP would stand out to be amongst a few good options to invest...???
Mrinal answers, hi, yes for investors begining to invest for the first time, SIPs are the best way of investing. Build a portfolio of well managed funds with track record of atleast 3-5 years to show for
________________________________________
shk asked, hi i am self employed person monthly i can save between 5000 to 10000 i have 2 kids i want to save for there future where and how should i invest plz ans me hi i am self employed person monthly i can save between 5000 to 10000 i have 2 kids i want to save for there future where and how should i invest plz ans me hi i am self employed person monthly i can save between 5000 to 10000 i have 2 kids i want to save for there future where and how should i invest plz ans me
Mrinal answers, hi, the answer to your question lies in making an comprehensive investment plan made for you. The investment plan will precisely tell you how much to invest for each financial goal and in which ivestment instrument
________________________________________
subrat asked, I am a salaried employee, i am planning to buy a home but only after 3 years. What kind of investments do you think will be suitable for me so that I can use the money saved for my home but at the same time not let the money lie around idle.I can save about 10 to 15 thousand per month
Mrinal answers, in my view you can consider investing in MIPs from mutual funds. HDFC MIP - Long Term is among the better performing MIPs
________________________________________
tst asked, Sir I invested in following MF through SIP. Pls suggest can continue same for long term DSP BR TIGER, HDFC growth, Sundaram Select focus, DSP ML Equity growth.
Mrinal answers, hi, you have a good portfolio of mutual fund schemes.Continue with your SIPs.
________________________________________
MyMoney asked, Please sugget some tips on how to select a Pension fund. I can invest around 35-40K per year. Is LIC worth looking at?
Mrinal answers, hi, Pension plans help you meet your post retirement needs. It is important to have a retirement plan in place before taking any pension plan. In my view, invest in a mix of equity funds and debt rather than taking a pension plan.Build a retirment corpus adequate enough to generate regular income every year post retirement
________________________________________
investor asked, I have a certain lumpsum amount for which I need capital protection. Is it a good idea to invest lumpsum in debt oriented MIP and invest the monthly income in good equity diversified funds? If not can you suggest a better alternative?
Mrinal answers, hi, sounds like a good idea. I would recommend that you opt for quarterly dividends as agianst monthly in case of MIPs
________________________________________
madanchikna asked, Hi Mrinal, I am a salaried person having monthly intake of 60k after cutting taxes . I want to buy one 2BHK of cost around 30L ,where to invest my money and how to invest? can u please guide me .. thnx in advance
Mrinal answers, hi, The selection of investment option will depend on when you need the money i.e no of years to buying your property. If your investment period is less than 3 years, fixed income instruments like FDs will be the ideal. In your case capital preservation is important compared to returns.
________________________________________
narah asked, Mrinal, Your point about ULIPs is good, in fact I also planned to invest in term plans and MFs for future. However I have already invested around 1.5 lakhs in ULIPs over the last 3 years. Should I close all those and invest in MFs and equities and take a good term plan?
Mrinal answers, hi, After your mandatory investment of 3 years, do not pay further premium. Rather invest in mutual funds.
________________________________________
abhi asked, Please rate these NFO, I want to invest either of them through SIP for 3 years 1. JPMorgan JF Greater China Equity Offshore Fund 2. DSP BlackRock World Energy Fund 3. Canara Robeco F.O.R.C.E Fund 4. Kotak Select Focus Fund Please suggest Thanks Abhishek
Mrinal answers, hi, in my view your portfolio is not very healthy. You have all the thematic funds in your portfolio. I would recommend that you redeem you entire portfolio and invest in well managed diversified equity funds with a track record of atleast 5 years.
________________________________________
GetMore asked, I m a 44 yr old, can save max 5 k per month, interested in retirement solutions, but return on pension scheme is very nominal. Planning to invest in MF for approx 14 yrs. Your Opinion required
Mrinal answers, hi, in my view pension plans are expnesive and may not be the ideal way to plan for retirement. I would suggest that you take help of a financial advisor to get a retirement plan made for you and then invest in line with your retirement plan
________________________________________
raj asked, Madam, for my 2 yr old son what do u suggest a MF with SIP or insurance as i dont want returns till 18 yrs. I already have his Max new york life insurance, savings a/c , kids a/c &FDs
Mrinal answers, hi, to plan for your child's future expenditure like higher education / marriage, get an investment plan made. The investment plan will help you decide how much money you will need after 18 years, how much should you invest every month and which products so that you have the right amount of money at the right time.
________________________________________
Mani asked, Hi, what will happen if we stay invested for long years (say 20 years , 15 years..) in a mutual fund? eg a amount of rs 10000 in a good mutual fund for that many years. Is that a good strategy.
Mrinal answers, hi, yes 15 years is a good time for investing in equities. If you invest Rs. 10,000 in equities for 15 years and if you money grows at the rate of 15% p.a. over 15 years, your investment of Rs. 10,000 will grow to Rs.80,000 (approx). Yes, its a good idea to invest in equities for 15 years but do not forget that your investment is in line with your asset allocation and risk appetite
________________________________________
Rajeev Sharma asked, Hi Mrinal, Can you throw some light on taxation related to short term and long term gains on both equity and debt funds. Also, I have about 6 months expenses as a contingency fund of about 6 lakhs - all in Bank FDs. Given the low interest which they are fetching does it make sense to move them over to debt mutual funds. Thanks for your answer.
Mrinal answers, hi, i have discussed the taxation of mutual funds earlier in this chat. Regarding moving money from FD to debt funds, you need to understand that while FDs offer fixed assured returns debt fund returns are market linked. Technically speaking debt funds can give negative returns if the interest rates in the economy move up. Given today's economic scenario and the fact that its your contingency fund, I would not advise you move out of FD
________________________________________
Pari asked, How abt investing 1 lac in short term and then keeping rotating this money in the market in stokcs?
Mrinal answers, hi, I would not recommend equity investment for investment horizon less than 3 years. While it make seem easy to make money from stock market while the going is good do not forget the fact that equities investments carry maximum risk. A stock can fall 20% in one day and if it is because the company's fundamentals are bad the loss could be permanent. Hence invest in good company shares with long term horizon of atleast 3 years
________________________________________
LAKSHMINARAYANAN asked, Which diversified fund can be invested now for monthly SIP for Rs.2000/- each for 3 MF and time horizon of 10 years
Mrinal answers, hi, you can consider investing in funds like Franklin India Bluechip, HDFC Equity and DSP BR Top 100 Equity Fund among others
________________________________________
beakrishnan asked, i am a retired personal and have something atlast to invest- FDs rates are very marginal now a days. I am not interested in investing in risky stock market - can you advise me suitably as to where can i invest this little sum of mine?
Mrinal answers, Dear Sir, it is true that interest rates are low and the options are few. You can consider investing in Senior Citizens scheme that offers 9%. The maximum investment in this scheme can be upto 15 lakhs. Bank Fds are the next option to choose from.
________________________________________
narah asked, Mrinal, Are all ULIPs bad according to you?
Mrinal answers, hi, ULIPs charge are high for the first 3 years. In a normal scenario the it take at least 10 years for the ULIPs to recover the initial costs. Consider a combination of term plan and mutual funds over the ULIPs
________________________________________
tst asked, Hi sir, what about Rel infrastructure fund and DSP ML world power fund(NFO)
Mrinal answers, hi, these are thematic funds that offer higher return for higher risk. The fund is dependent on the performance of the sectors that form the theme. The fund manager does not have the flexibility to invest in sectors that do not form a part of the theme. In a situation where the underlying sectors are not doing well the fund manager has no choicd but to stay invested in the same. Hence, investors who are sure of the future performance of the sector and who can time their entry into and exit form the sector can consider investing in these funds. It is better to look at diversified equity funds that can invest in any sector that the fund manager finds attrative from returns point of view.
________________________________________
sandeep asked, Is it good to go for term insurance for financial security? which plan is best and exact amount to go for at age of 30 with one child?
Mrinal answers, hi, as far as insurance is concerned the ideal option is term plan. Do not go for endowment, money back or ULIPs. Term plan offer only risk cover and you get the benefit of higher sum assured for lower premium. I would adivse you to calculate your human life value (HLV) and then decide the sum assured for your term plan.
________________________________________
123 asked, hi, I there any plan to invest Rs. 5000/month for 15-20 years to get better returns.
Mrinal answers, hi, for investment horizon of 15 years equities are the best investment opiton. However, you should keep in mind that stock markets are volatile and equity investments carry maximum risk. The longer you stay invested the higher the chances that you will make goo returns
________________________________________
qwerty asked, query on sips - irrespective of the fact that an sip is started earlier to august 09 , will entry load be deducted ? if so why as each sip is treated as a fresh purchase . please give ur opinion .
Mrinal answers, hi, the SEBI circular says that all equity oriented fund SIPs registered prior to 1st August 2009 will be charge entry loads till the last instalment is invested. In other words,all SIPs registered after 1st August will be not be charged any entry load
________________________________________
dfdd asked, Is there any income tax obligation for long term investments (more than 1 year) in stocks or mutual funds? What percentage of the returns would be taxed? What if I have a loss on the investments?
Mrinal answers, hi, if you are investing in equity and balanced funds then there is no long term capital gains tax if the investments are redeemed after one year. In the case of debt funds, the long term capital gains tax would apply. It will be 10% without indexation and 20% with indexation whichever is lower. If there is a long term loss on equity funds then the same cannot be adjusted against the long term capital gains. In the case of Long term capital gains from debt funds, the long term loss can be set off against long term gains
________________________________________
qwerty asked, sir i am in mid 30's and wish to invest in mutual funds . i have read about investement in index funds and etfs . what are these and how are they better than active funds. are they worth investement and what proportion of my amount should i invest . if recommended which are the ones which are recommended .
Mrinal answers, hi, index fund invest in stocks that constitute the underlying index and in the same proportion. The fund manager has no choice to invest in stock other than those that form a part of the index. Hence it is known as a passive style of management and the expenses are low compared to actively managed funds. In India, non-index based diversified equity funds have outperformed the popular index like Sensex and Nifty. Hence, if you are considering investing in index funds do not allocate more than 20% of your overall equity portfolio to these type of funds
________________________________________
qwerty asked, how is franklin felxicap ? should we exit and enter franklin bluechip
Mrinal answers, Hi, Franklin Flexicap can invest across stocks with any market cap as agains Bluechip which can invest only in large cap stocks. If you are willing to take risk of investing in large and midcap stocks then Flexicap is ideal or else switch to Bluechip Fund
________________________________________
rites asked, hi, Mrinal my salry is 9000/-pm i can save 4 to 5k p.m. which saving plan is best for me pls suggest
Mrinal answers, Hi, I would advise that you invest your monthly savings in line with your investment goals and risk appetite. For e.g your investment goal can be retirement and if retirement is 10-15 years away then majority of your savings can be invested in equities and the balance in debt
Tuesday, July 14, 2009
FINANCIAL ADVISER PISHUVARDHAN SHETH OF APPLEFINANCE REPLIES TO QUERIES
ria asked, which is the best saving option amont MIS and NSC so that i can get cash for my monthly expenses during my retirement.?Pishuvardhan Sheth answers, hi, for monthly income Post Office MIS is one of the option but there is a limit of Rs 9 lakhs. Besides MIS, you can consider options like FDs with monthly / quarterly income plan. For e.g. HDFC Ltd fixed deposit offers the monthly income plan
Udayan asked, Hi, I need to understand I am 27 and I have a cash balance of arnd 10 lacs and anrd 10 in equity and MFs I have Booked a under construction flat of 50 lacs where i have to arrange the money in next 3 yrs in phased manner, I am currently earning and 11 lacs per anum. Please advice selling timing for selling stocks and getting loans.Pishuvardhan Sheth answers, hi, if the money to be paid for construction of house is currently invested in equities, then you should start the exit immediately. As and when you get good opportunity, I recommend that you exit. You have 3 years to go before the money is to be paid. 3 years should be long enough to help you exit equities completely
bharatbalani asked, Sir, i want to invest 50000 rs every month. Where should i invest for long termPishuvardhan Sheth answers, hi, by long term if i assume 5 years and more then I would recommend that you consider investing major portion of your savings in equities. Equities are volatile but over the long term they can give you returns in the range of 12-15%
thirumalai asked, hi i am 33 years old i want to retire at age of 50, kindly advise which mutual funds i should invest to get retirement amount of 2 crores & 25 lakh for my son education, i am based in dubai.Pishuvardhan Sheth answers, hi, since your retirement is 17 years away, I would recommmend that you consider equity funds for your retirement plan. Ideally you should invest in well managed diversified equity funds with minimum track record of 3 years to show for. Also, when you make you plan aim for returns in the range of 12-15% from equity. IF you aim for higher returns, you will run the risk of missing the retirement age. Simialr strategy for your son's education
Manoj asked, Hello sir, I am a new invester.Need to invest.Starting with 50K,can you please suggest me wat will be good to invest?should i invest in share?or in MF.Please suggest. Thanks.
Pishuvardhan Sheth answers, hi, since you are new to the world of investments, I suggest that you take help of an honest and competent investment advisor. Get an investment plan made for your various life goals like retirement, education, marriage, property, etc. The plan will suggest how much investment should be done in equity/debt/gold etc. In my view MFs are the best way to build your investment portfolio.
rajrishi asked, Is retirement plans a good option or mediclaim is?Pishuvardhan Sheth answers, hi, retirement plan will take care of your post retirement expenses. These will include your day to expenditure and major expenditure like travel etc. Regualr medical expenses can be take care of by the retirement fund. To insure against any major medical cost like hospitalisation, etc medicalim is the best route.
Atul asked, i have 50000 now to invest, shd i invest in this market?
Pishuvardhan Sheth answers, hi, if you are looking at investing in equities from long term perspective then you should go ahead and invest. For investors with long term view of more than 5 years, short term trends of stock markets should not matter. Given the current scenarios stock markets look poised to give you returns of about 15% over the next 5 years.
vishalpai asked, Hello,How should one calculate how much insurance is enough?I am 27 with coverage of 40L in LIC through a money back policy.I have dependent parents.Should i go for more insurance? Pishuvardhan Sheth answers, hi, to know the amount of insurance cover one should take, you shlould calculate the Human Life Value.
asdqq asked, plz suggest best ELSS fund for 3 yr horizon????
Pishuvardhan Sheth answers, hi, you can consider funds like Franklin India Taxshield and Fidelity Tax Advantage Fund among others
vishalpai asked, Hi Good morning,What is the best option to invest now -plain vanilla funds,infrastructure/sectoral funds,bluechip funds?
Pishuvardhan Sheth answers, hi, I am of the view that investors should always invest in well managed diversified equity funds. Sector/Thematic funds should be avoided as the performance of these type of funds is dependent upon the performance of the underlying sectors. The entry and exit from the sector has to be timed well to benefit from invest in sectoral/thematic funds
MMM asked, i want to invest in balance fund. Which are top 3 in above category?Pishuvardhan Sheth answers, hi, among the balanced funds you can consider funds like HDFC Prudence and DSP BR Balanced Fund
sethi asked, invested sip rs4000 in hdfc top 200 , rs 200 sip in hdfc equity. i have incureed heay losses by investing in funds like tata indoglobal , jm agri infra , ing fof , reliance diversified , icici pru infra and now want toknow what should i do
Pishuvardhan Sheth answers, hi, you have invested in secotral/ thematic funds. These funds ofder high risk high return proposition. In my view you should exit these schemes and invest in diversified equity funds like the ones you currently hold - HDFC Top 200, HDFC Equity
deepak23460 asked, Sir,I want to secure future of my child. he is 01 yr. I would like to invest 25000/- should i invest it in MF or ULIP or Shares..Pishuvardhan Sheth answers, hi, in my view build a portfolio of mutual funds for your child. Consider having 4-5 best mutual funds schemes. I will not recommend ULIP as an investment option
sanjay19 asked, should a new investor use this correction in equities to invest now?
Pishuvardhan Sheth answers, hi, if you are long term investor then the current fall in the stock markets should be considered as an opportunity to invest. The short term trend should not deter you from investing in equity as long as the long term trend is upward which it currently is
UPENDRA asked, WHAT IS BEST INVESTMENT ROUTE FOR LONG TERM (10-15 YEARS).Pishuvardhan Sheth answers, hi, the best investment option for 10-15 years would equities. Even property will be a good option but then for property the initial investment amount required will be comparatively large.
gireesh_27 asked, Hi Pishuvardhan Sheth, I am a Doctor and working in Gulf earling nicely, but it will not long last, may by 2012 I will back to India, by that time I will have around 1 crore in my hand presently I am having 65 L with me, I am 32 yr old what are the options for investment for me, Thank youPishuvardhan Sheth answers, hi, consider making an investment plan for yourself. The plan should help you achieve the various life goals you have set for yourself. Once you have the plan in place, it will be easy for you to determine the asset allocation and the investment instruments (mutual funds/ shares/FDs)
investforfuture asked, When Equity based Mutual funds also follow the direction of market, then why would one need to invest in mutual funds at all. We can as well directly invest in equities. Your thoughts ?
Pishuvardhan Sheth answers, hi, to invest in stocks directly you need to research the company's performance and the future growth prpspects. The common investor may not have the necessary tools to analyse the company's financials. He may have to rely on his borker/friends. Mutual funds are managed by professional fund managers. They have the necessary skill sets and tools to understand the perofrmance of the company and its future prospects.
investforfuture asked, How much of one's portfolio should be in equity ?Pishuvardhan Sheth answers, hi, the thumb rule is that 100 minus one's age should be in equities. The logic behind this is that as you grow in age the risk taking ability goes down. As one progresses near retirement, more money should be allocated to safe instrument like fixed deposits etc. The thumb rule is just the starting point and may not always offer the best asset allocation mix. Also the investor's risk profile should be taken into consideration.
rrrrr asked, hi Pishuvardhan Sheth, iam investing 5000 rs every month in various mutual fund now 3rd year is going on but due to recession iam unable to pay this amount every month what to do? when can i withdraw this? and how much i will be benefited?Pishuvardhan Sheth answers, hi, if you are not able to continue with the SIPs then you can stop till your cash flow improves. However, as soon as you are in a position to invest again please do start. The benefit of SIP investment will be visible only after 5 years when you have invested through various market cycles.
Sanat asked, Hi Pishuvardhan Sheth I wanna invest Rs. 10K/month regularly for atleast next 48 months. Can you pls advice me suitable SIP(s)? Thanks in anticipation of your reply. Cheers!!Pishuvardhan Sheth answers, hi, consider funds like franklin india bluechip fund, hdfc equity fund and dsp br equity fund to start with.
dev1 asked, Hi Pishuvardhan Sheth I m 30 and need to invest in a good Unit linked pension plan. Can you suggest which is the best plan to invest 5k/month as sip.
Pishuvardhan Sheth answers, hi, in my view do not go for ULIP. ULIP combines investment and insurance . for investments you should build a portfolio of equity and balanced funds. For insurance the best option is to take a Term plan to cover the risk in case of any eventuality
riya asked, Hi......I am 32 now and have 10L savings till now out of which 6L are in FD's at 8.5% which will due in middle of 2010 and 3L in MIS which will due by 2009 dec and i have 1 L in equity whose value is 40k now. So what should i do with FD's and MIS , should i reinvest them or move some more amount in equities. thanks
Pishuvardhan Sheth answers, hi, the answer to your question lies in determing the final need for the money which you have saved. In my view you should make an investment plan for yourself and then decide the asset allocation and investment options.
einvestor asked, hi, what about investing in Quantaum FoF offer? Pishuvardhan Sheth answers, hi, its a good investment proposition given the fact that the investor does not have to build and manage his equity fund portfolio. The Quantum FoF will invest in equity funds of other mutual funds
kshiv asked, Dear sir Invested in sbi contra,hdfc top 200,dsp 100 & reliance growth through sip.how do u see my portfolio in longterm?more than 5 yrs.thanks
Pishuvardhan Sheth answers, hi, except for SBI Contra, all your funds are good. Continue you investments in the same.
singhs asked, Hello Mr Pishuvardhan Sheth, I tried asking you the same question while you were online last time, but could not get any answer. Hopefully this time... I am investing 40000 annually in the Money Plus Growth Scheme of LIC since 2007 which has a locking period of 3 years. What should i do? Keep investing or opt out after this years premium? Thanks in advance!Pishuvardhan Sheth answers, hi, you should invest for the mandatory period of 3 years. After the mandatory period is over you should stop paying further premiums
juhi asked, Hello Sir, When u say invest in equities for long term more than 5 years... do you think one should book profits at regular interval or keep on investing systematically without any withdrawals regardless of what is happening in stock market? Thanks in advance for clearing my confusion. Regards
Pishuvardhan Sheth answers, hi, yes if your returns are way ahead of the expected returns then you should certainly book profits. For e.g. if your expected return from equities is 15% and your returns are say 30%, then you should book profit by taking the excess 15% of the table and invest in low risk instruments like FDs/ Gold
gaurangpatel asked, hi, i want training regarding options....can u suggest any book or any person/institutions giving systematic knowledge of options regarding indian market.?Pishuvardhan Sheth answers, hi, you can attend trainining sessions conducted by Bombay Stock Exchange.
dev1 asked, Hi Pishuvardhan Sheth I m 30 and need to invest in a good Unit linked pension plan. Can you suggest which is the best plan to invest 5k/month as sip.
Pishuvardhan Sheth answers, hi, in my view do not go for ULIP. ULIP combines investment and insurance . for investments you should build a portfolio of equity and balanced funds. For insurance the best option is to take a Term plan to cover the risk in case of any eventuality
Udayan asked, Hi, I need to understand I am 27 and I have a cash balance of arnd 10 lacs and anrd 10 in equity and MFs I have Booked a under construction flat of 50 lacs where i have to arrange the money in next 3 yrs in phased manner, I am currently earning and 11 lacs per anum. Please advice selling timing for selling stocks and getting loans.Pishuvardhan Sheth answers, hi, if the money to be paid for construction of house is currently invested in equities, then you should start the exit immediately. As and when you get good opportunity, I recommend that you exit. You have 3 years to go before the money is to be paid. 3 years should be long enough to help you exit equities completely
bharatbalani asked, Sir, i want to invest 50000 rs every month. Where should i invest for long termPishuvardhan Sheth answers, hi, by long term if i assume 5 years and more then I would recommend that you consider investing major portion of your savings in equities. Equities are volatile but over the long term they can give you returns in the range of 12-15%
thirumalai asked, hi i am 33 years old i want to retire at age of 50, kindly advise which mutual funds i should invest to get retirement amount of 2 crores & 25 lakh for my son education, i am based in dubai.Pishuvardhan Sheth answers, hi, since your retirement is 17 years away, I would recommmend that you consider equity funds for your retirement plan. Ideally you should invest in well managed diversified equity funds with minimum track record of 3 years to show for. Also, when you make you plan aim for returns in the range of 12-15% from equity. IF you aim for higher returns, you will run the risk of missing the retirement age. Simialr strategy for your son's education
Manoj asked, Hello sir, I am a new invester.Need to invest.Starting with 50K,can you please suggest me wat will be good to invest?should i invest in share?or in MF.Please suggest. Thanks.
Pishuvardhan Sheth answers, hi, since you are new to the world of investments, I suggest that you take help of an honest and competent investment advisor. Get an investment plan made for your various life goals like retirement, education, marriage, property, etc. The plan will suggest how much investment should be done in equity/debt/gold etc. In my view MFs are the best way to build your investment portfolio.
rajrishi asked, Is retirement plans a good option or mediclaim is?Pishuvardhan Sheth answers, hi, retirement plan will take care of your post retirement expenses. These will include your day to expenditure and major expenditure like travel etc. Regualr medical expenses can be take care of by the retirement fund. To insure against any major medical cost like hospitalisation, etc medicalim is the best route.
Atul asked, i have 50000 now to invest, shd i invest in this market?
Pishuvardhan Sheth answers, hi, if you are looking at investing in equities from long term perspective then you should go ahead and invest. For investors with long term view of more than 5 years, short term trends of stock markets should not matter. Given the current scenarios stock markets look poised to give you returns of about 15% over the next 5 years.
vishalpai asked, Hello,How should one calculate how much insurance is enough?I am 27 with coverage of 40L in LIC through a money back policy.I have dependent parents.Should i go for more insurance? Pishuvardhan Sheth answers, hi, to know the amount of insurance cover one should take, you shlould calculate the Human Life Value.
asdqq asked, plz suggest best ELSS fund for 3 yr horizon????
Pishuvardhan Sheth answers, hi, you can consider funds like Franklin India Taxshield and Fidelity Tax Advantage Fund among others
vishalpai asked, Hi Good morning,What is the best option to invest now -plain vanilla funds,infrastructure/sectoral funds,bluechip funds?
Pishuvardhan Sheth answers, hi, I am of the view that investors should always invest in well managed diversified equity funds. Sector/Thematic funds should be avoided as the performance of these type of funds is dependent upon the performance of the underlying sectors. The entry and exit from the sector has to be timed well to benefit from invest in sectoral/thematic funds
MMM asked, i want to invest in balance fund. Which are top 3 in above category?Pishuvardhan Sheth answers, hi, among the balanced funds you can consider funds like HDFC Prudence and DSP BR Balanced Fund
sethi asked, invested sip rs4000 in hdfc top 200 , rs 200 sip in hdfc equity. i have incureed heay losses by investing in funds like tata indoglobal , jm agri infra , ing fof , reliance diversified , icici pru infra and now want toknow what should i do
Pishuvardhan Sheth answers, hi, you have invested in secotral/ thematic funds. These funds ofder high risk high return proposition. In my view you should exit these schemes and invest in diversified equity funds like the ones you currently hold - HDFC Top 200, HDFC Equity
deepak23460 asked, Sir,I want to secure future of my child. he is 01 yr. I would like to invest 25000/- should i invest it in MF or ULIP or Shares..Pishuvardhan Sheth answers, hi, in my view build a portfolio of mutual funds for your child. Consider having 4-5 best mutual funds schemes. I will not recommend ULIP as an investment option
sanjay19 asked, should a new investor use this correction in equities to invest now?
Pishuvardhan Sheth answers, hi, if you are long term investor then the current fall in the stock markets should be considered as an opportunity to invest. The short term trend should not deter you from investing in equity as long as the long term trend is upward which it currently is
UPENDRA asked, WHAT IS BEST INVESTMENT ROUTE FOR LONG TERM (10-15 YEARS).Pishuvardhan Sheth answers, hi, the best investment option for 10-15 years would equities. Even property will be a good option but then for property the initial investment amount required will be comparatively large.
gireesh_27 asked, Hi Pishuvardhan Sheth, I am a Doctor and working in Gulf earling nicely, but it will not long last, may by 2012 I will back to India, by that time I will have around 1 crore in my hand presently I am having 65 L with me, I am 32 yr old what are the options for investment for me, Thank youPishuvardhan Sheth answers, hi, consider making an investment plan for yourself. The plan should help you achieve the various life goals you have set for yourself. Once you have the plan in place, it will be easy for you to determine the asset allocation and the investment instruments (mutual funds/ shares/FDs)
investforfuture asked, When Equity based Mutual funds also follow the direction of market, then why would one need to invest in mutual funds at all. We can as well directly invest in equities. Your thoughts ?
Pishuvardhan Sheth answers, hi, to invest in stocks directly you need to research the company's performance and the future growth prpspects. The common investor may not have the necessary tools to analyse the company's financials. He may have to rely on his borker/friends. Mutual funds are managed by professional fund managers. They have the necessary skill sets and tools to understand the perofrmance of the company and its future prospects.
investforfuture asked, How much of one's portfolio should be in equity ?Pishuvardhan Sheth answers, hi, the thumb rule is that 100 minus one's age should be in equities. The logic behind this is that as you grow in age the risk taking ability goes down. As one progresses near retirement, more money should be allocated to safe instrument like fixed deposits etc. The thumb rule is just the starting point and may not always offer the best asset allocation mix. Also the investor's risk profile should be taken into consideration.
rrrrr asked, hi Pishuvardhan Sheth, iam investing 5000 rs every month in various mutual fund now 3rd year is going on but due to recession iam unable to pay this amount every month what to do? when can i withdraw this? and how much i will be benefited?Pishuvardhan Sheth answers, hi, if you are not able to continue with the SIPs then you can stop till your cash flow improves. However, as soon as you are in a position to invest again please do start. The benefit of SIP investment will be visible only after 5 years when you have invested through various market cycles.
Sanat asked, Hi Pishuvardhan Sheth I wanna invest Rs. 10K/month regularly for atleast next 48 months. Can you pls advice me suitable SIP(s)? Thanks in anticipation of your reply. Cheers!!Pishuvardhan Sheth answers, hi, consider funds like franklin india bluechip fund, hdfc equity fund and dsp br equity fund to start with.
dev1 asked, Hi Pishuvardhan Sheth I m 30 and need to invest in a good Unit linked pension plan. Can you suggest which is the best plan to invest 5k/month as sip.
Pishuvardhan Sheth answers, hi, in my view do not go for ULIP. ULIP combines investment and insurance . for investments you should build a portfolio of equity and balanced funds. For insurance the best option is to take a Term plan to cover the risk in case of any eventuality
riya asked, Hi......I am 32 now and have 10L savings till now out of which 6L are in FD's at 8.5% which will due in middle of 2010 and 3L in MIS which will due by 2009 dec and i have 1 L in equity whose value is 40k now. So what should i do with FD's and MIS , should i reinvest them or move some more amount in equities. thanks
Pishuvardhan Sheth answers, hi, the answer to your question lies in determing the final need for the money which you have saved. In my view you should make an investment plan for yourself and then decide the asset allocation and investment options.
einvestor asked, hi, what about investing in Quantaum FoF offer? Pishuvardhan Sheth answers, hi, its a good investment proposition given the fact that the investor does not have to build and manage his equity fund portfolio. The Quantum FoF will invest in equity funds of other mutual funds
kshiv asked, Dear sir Invested in sbi contra,hdfc top 200,dsp 100 & reliance growth through sip.how do u see my portfolio in longterm?more than 5 yrs.thanks
Pishuvardhan Sheth answers, hi, except for SBI Contra, all your funds are good. Continue you investments in the same.
singhs asked, Hello Mr Pishuvardhan Sheth, I tried asking you the same question while you were online last time, but could not get any answer. Hopefully this time... I am investing 40000 annually in the Money Plus Growth Scheme of LIC since 2007 which has a locking period of 3 years. What should i do? Keep investing or opt out after this years premium? Thanks in advance!Pishuvardhan Sheth answers, hi, you should invest for the mandatory period of 3 years. After the mandatory period is over you should stop paying further premiums
juhi asked, Hello Sir, When u say invest in equities for long term more than 5 years... do you think one should book profits at regular interval or keep on investing systematically without any withdrawals regardless of what is happening in stock market? Thanks in advance for clearing my confusion. Regards
Pishuvardhan Sheth answers, hi, yes if your returns are way ahead of the expected returns then you should certainly book profits. For e.g. if your expected return from equities is 15% and your returns are say 30%, then you should book profit by taking the excess 15% of the table and invest in low risk instruments like FDs/ Gold
gaurangpatel asked, hi, i want training regarding options....can u suggest any book or any person/institutions giving systematic knowledge of options regarding indian market.?Pishuvardhan Sheth answers, hi, you can attend trainining sessions conducted by Bombay Stock Exchange.
dev1 asked, Hi Pishuvardhan Sheth I m 30 and need to invest in a good Unit linked pension plan. Can you suggest which is the best plan to invest 5k/month as sip.
Pishuvardhan Sheth answers, hi, in my view do not go for ULIP. ULIP combines investment and insurance . for investments you should build a portfolio of equity and balanced funds. For insurance the best option is to take a Term plan to cover the risk in case of any eventuality
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