This Article is a Must Read for everybody as we introduce a new benchmark of calculating 10 Year SIP Returns –
DalalStreet.Biz [DSB] 10 Year Rolling MoM Internal Rate of Return for Mutual Funds in India
We started off with 5 of the Top Performing Funds which we recommended 11 years ago.
Since we posted just on twitter a year ago about our new methodology of researching mutual funds, I’m sure most of you must have missed this
MUST READ: We recommended investments in various HDFC Mutual Funds since 2003. Here is Ultimate Performance Review http://t.co/Z8xa0ha6
— Dalal Street Busines (@dalalstreet) January 7, 2013
and hence the motivation to enlighten you on why one must stick to SIP in Diversified Mutual Funds from Good Brands such as HDFC.
What is the Motivation in Starting new Methodology for Evaluating Mutual Funds – DSB 10 Year Rolling MoM IRR ? We believe that a country prospers only when its industry does and firmly believe that every citizen of the country must have direct / in-direct equity ownership in the Industry. Real Estate investment is mostly for folks with Lot of Black Money which is not at all our forte and Gold in the Long Term is not at all an investment that can dare to compete with Equities. Amongst what is available to Average at all Levels, Equity is the Best Investment one can get in India and is Free from the headache of TaxMan and is accumulated over 10+ years.
Why IRR for 10 Years and thereafter Rolling Month over Month [MoM]?
In a span of 10 Years of its existence, a fund would have seen both a Bear & a Bull Market and hence should have stood test of the time. Thus a Minimum of 10 year SIP is recommended in Diversified Equity Funds. For example, let us assume that you have started your SIP in HDFC Top 200 Fund in April-2003 and your 10 Year SIP would end in March-2013 and your Internal Rate of Return [IRR] would be 18.41% Tax Free. Not a Bad one but when you look at the Table Provided on Historical IRR of HDFC Top 200 Fund – You notice that the fund has given the best IRR of 37.39% on Jan-01-2008 for the proceeding 10 year SIP. Now you are in dilemma whether you’d want to redeem with 18.41% IRR or stay invested ? We Strongly Recommend that you stay Invested until you get an IRR of at least 24%.
Now without wasting further time, go ahead and study DSB 10 Year Rolling MoM IRR for Mutual Fund. Create Wealth SIP by SIP and this should form 50% of your Equity Portfolio and the remaining can be direct equity investments.
Should you have any questions or require advise on your investment, e-mail us at feedback At dalalstreet.biz