The enforcement Directorate is gathering information to investigate the company and its promoters under the Prevention of Money Laundering Act (PMLA).
On March 16, sources indicated the Directorate of Enforcement (ED) is searching Franklin Templeton Asset Management (India) Pvt Ltd.-related residences.

The foreign exchange and money laundering agency searched the home of former Asia-Pacific (APAC) distribution head Vivek Kudva and his wife Roopa. Sources say Roopa runs Omidyar Network India.

The crew visited Franklin Templeton Mutual Fund Chief Investment Officer-Fixed Income Santosh Kamath’s home.

We provide all data and information to regulatory and statutory authorities. “Franklin Templeton places significant emphasis on compliance with regulations, and we have adequate policies in place, compatible with Indian rules and worldwide best practises,” stated a representative for Franklin Templeton Asset Management.

Sources say these employees withdrew their personal funds from several of Franklin Templeton India’s six debt programmes in April 2020.

In August 2021, the capital market regulator Securities and Exchange Board of India (SEBI) judged the fund house and officials (including Kudva, Kamath, and others) guilty of mismanaging debt funds, which led to the abrupt winding up and locking up investors’ money.

Sources stated the ED is raiding key officials for removing their own money from these schemes before the winding-up announcement.

After 16 years with the firm, Kudva retired on July 28, 2022. According to sources, the PMLA probe against the company and its promoters is also seeking evidence.

Read our Blog – These are the top large-cap stocks that PMS strategies sold off in February.

SEBI crackdown

Franklin Templeton shocked investors and the mutual fund industry alike in April 2020 when he closed down six of his debt schemes. It stopped investors from getting their money back and said it would sell the securities and give the money back to investors.

In an investigation, the SEBI found that Vivek Kudva, who was head of Europe, the Middle East, and Africa (EMEA) at the time, and his wife Roopa took out Rs 30.70 crore from six debt funds just days before they were closed.

In a series of detailed orders issued in August 2021, SEBI also found the fund house, its trustee company, and eight other senior fund house employees guilty of mismanaging debt funds. The behaviour of Kudva and his wife was part of the investigation by SEBI.

Franklin Templeton had to pay a fine of Rs 5 crore because of “several irregularities” in how its six debt schemes were run. Between June 2018 and April 2020, the fund house was told to give back the Rs 451 crore (Rs 512 crore with interest) it got as fees for investment management and advice.

SEBI also told Vivek and Roopa Kudva that they couldn’t access the securities market, buy, sell, or do anything else with securities or have anything to do with the market for a year.

The SEBI order that Kudvas couldn’t access the capital markets was put on hold by the Securities Appellate Tribunal (SAT).

Franklin Templeton MF also argued against the orders at SAT, which is hearing the case.

Templeton’s response

Franklin Templeton India said that the six schemes that are being wound up have already paid out Rs 26,931.27 crore to unitholders as of March 16, 2023. This is equal to 106.81% of the total reported AUM value as of April 23, 2020.

So far, the amount paid out is between 99.32% and 112.466% of the reported AUM values of each of the six funds as of April 23, 2020.

“The Net Asset Value of each scheme was higher at the time of each distribution than it was on April 23, 2020. Also, five of the six funds have returned more than 100% of the AUM by April 23, 2020, when the decision to close down will be made. All performing securities have been sold in 4 of the 6 schemes, and only one issuer has three performing securities left to sell in the other two “said a spokesperson for the fund house.

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PMS managers were careful, so they got out of these large-cap stocks that they thought would do poorly.

So far this year, global and domestic headwinds have made the Indian stock market go up and down like a roller coaster. In the US, the recent failures of Silicon Valley Bank (SVB) and Signature Bank have also hurt investor confidence. During this time, the broader market index Nifty 50 fell by 5%. Fund managers were careful and got out of stocks they thought would not do well. Here are the top large-cap stocks that Portfolio Management Services (PMS) fund managers sold out of completely in February. Data about the portfolio as of February 28, 2023. Finalyca – PMSBazaar is the source.

Read our Blog – Advantages of Mutual Funds

Bajaj Finance
The number of PMS strategies that got out of the stock completely is 9. The number of PMS strategies that still hold the stock is 57.
Examples of how people got out of PMS stocks: Accuracap – Alpha 10 and Globe Capital Market – Value

Bajaj Finserv
Number of PMS strategies that got out of the stock completely: 7
There are 34 PMS strategies that hold the stock at the moment.
Examples of how people got out of PMS stocks: Concept Investwell’s Dynamic and ICICI Prudential’s ACE Portfolio

Asian Paints
Number of PMS strategies that got out of the stock completely: 6
There are 38 PMS strategies that hold the stock at the moment.
Examples of how people got out of PMS stocks: Globe Capital Market – Value & Axis – Brand Equity PMS

Bharti Airtel
Number of PMS strategies that got out of the stock completely: 5
There are 58 PMS strategies that hold the stock at the moment.
Examples of how people got out of PMS stocks: Reliance – Mint & Tamohara – TIOS

Hindustan Unilever
Number of PMS strategies that got out of the stock completely: 5
Number of PMS strategies that hold the stock at the moment: 28
Examples of how people got out of PMS stocks: Agreya’s Growth Strategy is Diversified, and MOAT stands for “Special Opportunities.”

Cipla
Five PMS strategies got out of the stock completely. Twenty PMS strategies still have the stock.
Examples of how people got out of PMS stocks: Agreya’s Diversified Growth Strategy and Globe Capital Market’s Value.

Titan Company
Number of PMS strategies that got out of the stock completely: 4
Number of PMS strategies that hold the stock at the moment: 56
Examples of how people got out of PMS stocks: Growth and Lakewater Advisors – Lake Water

United Spirits
The number of PMS strategies that got out of the stock completely is 4. The number of PMS strategies that are still holding the stock is 5. 32
Examples of how people got out of PMS stocks: Motilal Oswal’s VALUE and Alchemy: High Growth.

Trent
Four PMS strategies sold all their shares of the stock. Thirty PMS strategies are still holding shares of the stock.
Examples of how people got out of PMS stocks: Centrum PMS is called “Multibagger,” and ORO is called “All Weather Portfolio.”

Cholamandalam Investment and Finance Company
Number of PMS strategies that got out of the stock completely: 4
There are 29 PMS strategies that hold the stock at the moment.
Examples of how people got out of PMS stocks: Sundaram Alternative – SELF and Axis – Core & Satellite PMS.

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Mutual Funds are one of the most commonly known investments in the Indian market. A large number of Indian households have their money invested in these funds and for all the good reasons. A mutual fund is a pool of money from many investors that is managed by a professional and used to buy stocks and bonds.

Let me quickly and simply explain how everything works. A fund is started usually by an institution. These institutions hire the most experienced financial market experts, and then many individual and institutional investors put money into the fund based on how reliable it is. The most important job of the experts is to make sure that the money people give them is invested in the best possible securities. Depending on the type of mutual fund, they buy the best stocks and bonds on the market. The value of which is decided by dividing the number of shares by the amount of money invested in it. So, the investor can sell his share of the mutual fund whenever he wants and keep the money he made.

Read our Blog – BEST 5 SIP EQUITY BASED MUTUAL FUNDS IN 2023

In today’s market, there are several benefits of mutual funds and in this article, let’s talk about a few of them.

DIVERSIFICATION

One of the most noticeable advantages of mutual funds is their liquidity. There are several assets available in the financial market, but the majority of them are either extremely risky or extremely illiquid. That everything comes together with mutual funds. You can withdraw (redeem) your investments from the fund at any time and invest at any time. In fact, there are currently funds that offer instant redemption, in which the money is sent into your bank account on the same day you redeem it. In rare instances, however, the exit load can be imposed.

A HASSLE-FREE INVESTMENT

Mutual funds become a very simple investment with IPOInfo. You may easily invest in mutual funds without any needless effort if you have the correct guidance and support. All you have to do is register on the website, and the executives will handle everything else.

EXPERT MANAGEMENT

Every mutual fund is managed by a team of financial professionals. They are well-versed in the securities and financial markets in which the fund is engaged. The professionals regularly watch the markets for you and keep an eye on every market movement, ensuring that your risk is minimised and your return is maximised. One of the most important advantages of mutual funds is that they are constantly handled by these specialists.

REGULATED

The SEBI guidelines make sure that mutual funds are well run. SEBI keeps an eye on them all the time to make sure that the mutual fund houses follow their rules. Mutual fund companies are also required to share their portfolios every month to make sure that everything is completely clear.

OPTIONS OF INVESTMENT

With mutual funds, you can invest in a number of different ways. You could, for example, invest a lump sum and wait for it to grow over time. Or, you can use SIP to put away small amounts every month. SIPs are plans for investing money in a regular way. These investments are a good idea because they spread out your money over time and help you make up for any losses. Read this blog to learn about some of the Best Mutual Funds for SIP.

TAX BENEFITS

Depending on the type of investment, mutual funds offer a number of tax breaks. For example, you can save up to 1.5 lakhs every year through Equity-Linked Saving Schemes. Several investors are interested in this investment because it will save them money on taxes. These plans lock people in for three years.

LOW LOCK-IN PERIODS

If there are any lock-in periods at all, they are very short. Mutual funds have a maximum lock-in period of three years, which is much less than FDs, ULIPs, and other low-risk funds. But there are also funds that don’t have any lock-in periods at all. These funds are called “Overnite funds,” and they were made to have more cash on hand.

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Mutual funds are now one of the safest ways to put your money to work. We work hard to make money, but it’s important to make that money work for you. Mutual funds can help with this. Mutual funds are a good way to invest if you don’t like taking risks and want a diversified portfolio that is watched by experts. The best mutual funds give you a wide range of stocks to choose from and make sure they are being watched by experts. They keep an eye on every move of the market to get you the best possible profits. With IPOInfo, you can get the best advice from Mutual Funds experts at your own convenience, based on how much risk you are willing to take.

SIPs are a great way to use mutual funds to your advantage. Under this, you invest a fixed amount every month in the mutual fund of your choice. SIPs are also a good way to spread out your investments and protect yourself against losses. And today, let’s analyse some of the greatest mutual funds in the market for SIP (Systematic Investment Plan) (Systematic Investment plan).

Read our Blog – High-cash-flowing companies | These midcaps and smallcap stocks are favourites of mutual funds

TOP 5 SIP MUTUAL FUNDS

1. AXIS BLUECHIP FUND

With a size of 27,142 crores, the Axis Bluechip Fund is one of the largest in its category. Over 96% of the fund is put into the Indian stock market, and almost 85% of that is put into large-cap stocks. The rest is made up of Futures and Option holdings, Mid-cap stocks, and AXIS FDs. The fund has money in 41 stocks, and since it started, its SIP returns have been great. After ten years, a SIP investment is worth more than 230 per cent of what it was worth at the start. Even though this is a very high-risk fund, it is the best mutual fund for people who are willing to invest for 4-5 years and want to make more money. But on the investment horizon, there is a chance of small to moderate losses.

2. MIRAE ASSET LARGE FUND

Another fund that mostly invests in large-company stocks is the Mirae Asset Large Cap Fund. The Large-cap equity sector is one of the most profitable and safe investments. More than 97% of the fund is put into Indian stocks, and 71% of those stocks are big companies. The fund has 61 stocks in its portfolio, and a 10-year SIP has earned 144% on those stocks. However, one should be prepared to bear moderate losses, but the fund has a good performance so far. And is one of the best mutual funds for SIP in its category Especially, when it comes to SIPs. This stock is a good way to diversify a portfolio for people who want to put their money away for 3–4 years.

3. SBI BLUE CHIP FUND – REGULAR PLAN-GROWTH

The SBI Blue Chip Fund has a market capitalization of more than ₹28,210 crores which occupies more than 14% of the investment in its category. Even though it is considered a moderately high-risk fund, it has a very good CRISIL Rating of 4. This is more than the average rating for a fund in its category and is also why it is considered one of the best mutual funds on the market right now. The fund is divided into 53 equity stocks. Almost 97% of the fund is invested in Indian Stocks, out of which more than 73% is invested in large-cap stocks. The rest is invested in mid-cap, small-cap, and some very low-risk debt securities.

The fund has given more than 122% returns for a SIP started 10 years ago and has been performing pretty well ever since its inception. It would be the best mutual fund for a person looking to invest for a good 3-5 years and expecting high returns. However, just like in all other funds, one needs to be prepared for possible moderate losses.

4. EDELWEISS LARGE AND MID CAP FUND – REGULAR PLAN-GROWTH

Edelweiss Large and Mid Cap fund is a very good fund with great potential. The fund has a CRISIL Rating of 5 which is very good for mutual funds. The fund’s size is 778 crores, about 97% of which is invested in Indian stocks. There are 65 stocks in the fund. About half of them are large-cap stocks, and the other half are mid-cap stocks. Small-cap stocks and TREPS make up the rest of the fund. The fund has given close to 131% returns on a SIP that began 10 years ago, and it has given close to 55% annualised returns on a SIP for the past year. Since the beginning, the fund has been doing well, and it continues to do well. This fund is for people who want to invest for a few years and want to make a lot of money. It is one of the best mutual funds on the market because it has a great CRISIL rating. This gives it an edge over other stocks in its category.

5. KOTAK EQUITY OPPORTUNITIES FUND – GROWTH

Kotak Equity Opportunities Fund had 56 Indian Equity Stocks in its portfolio. About 48% of the fund is made up of large-cap stocks and 33% is made up of mid-cap stocks. The rest is made up of small-cap stocks and other securities. The size of the fund is over 6361 crores, which is 7.6% of the total investments in its category. Even though the fund is considered to be moderately risky, its CRISIL rating is 4, which is better than average for a fund in its category. It has given a SIP that began 10 years ago a return of almost 140%. It has some of the best stocks on the market and is a pretty good investment for someone who wants to put money away for a few years. But you should always be ready for the chance that you will lose.

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High-cash-flowing companies | A high free cash flow shows profitability, growth, and return, which are the three most important things. It gives a company more room for growth, dividend payments, and getting rid of debt.

The free cash flow (FCF) matrix is one tool that active fund managers use to choose stocks. FCF is the cash left over after a company has paid all of its operating and business costs. A FCF shows the three most important things about a company: how profitable it is, how fast it is growing, and how much it pays back to its owners. It makes room for more growth, regular dividend payments, and paying down debt. Ravi Saraogi, co-founder of Samasthiti Advisors, says, “FCF is an important metric to understand the quality of a company’s reported earnings. Capital market theory says that the value of a stock is based on the dividends it will pay out in the future. The most common way to figure out how much a stock is worth is to discount future dividends to the present and compare them to the current price of the stock. FCF is a metric that can be used to figure out if a business might be able to pay dividends. But what’s more important is that fund managers think that FCF is hard for management to change, while accrual income has a lot more room for management to change it to their liking. Here are the midcap and smallcap companies that the MF likes the most and that consistently made more money from their operations between 2018 and 2022. During that time, companies with relatively higher revenue growth were also taken into account when choosing these stocks. The data on the portfolio as of January 31, 2023. From the ACEMF.

Oil India is a mid-cap company. Between 2018 and 2022, their free cash flow will grow by 18%, and their revenue will grow by 29%.
The debt-to-equity ratio (in times): 0.54 \sNo. of active MF schemes that held the stock: 11

Read our Blog – Artificial Intelligence chips battle, your portfolio profits.

Ajanta Pharma
Small-cap MCAP type. Free cash flow growth (in CAGR): 157%. Revenue growth (in CAGR): 12%.
Ratio of debt to equity (in times): Nil
The stock was held by 48 active mutual fund schemes.

The type of Indian Energy Exchange MCAP: Small-cap
Free Cash Flow Growth (in %): 155%
17% growth in sales (in CAGR)
Ratio of debt to equity (in times): Nil
15 active mutual fund schemes owned the stock.

Affle (India)
Small-cap MCAP type. Free cash flow growth (in CAGR): 103%. Revenue growth (in CAGR): 90%.
Debt-to-equity ratio (in times): 0.13 Number of active MF schemes that held the stock: 27

Jindal Steel & Power
MCAP = Mid-cap Free Cash Flow Growth (in CAGR) = 85%
(in CAGR): 23% growth in sales.
Debt-to-equity ratio (in times): 0.36 Number of active MF schemes that held the stock: 75

Finolex Industries is a small-cap MCAP company. Its free cash flow growth rate (in CAGR) is 60%.
(in CAGR): 13% growth in sales.
Number of active MF schemes that held the stock: 19 Debt-to-equity ratio (in times): 0.07

Tube Investments of India
MCAP type: Mid-cap \sGrowth of Free Cash Flow (in CAGR): 50%
(in CAGR): 25% growth in sales.
Debt-to-equity ratio (in times): 0.26 \sNo. of active MF schemes that held the stock: 55

Abbott India
Type: Mid-cap Free cash flow growth (in CAGR): 46% Revenue growth (in CAGR): 11%
Ratio of debt to equity (in times): Nil
72 active mutual fund schemes owned the stock.

Gateway Distribution Parks is a small-cap MCAP type.
Free Cash Flow Growth (in CAGR): 42%
(in CAGR): 16% growth in sales.
Debt-to-equity ratio (in times): 0.31 Number of active MF schemes that held the stock: 26

Prudent Corporate Advisory Services
Type of MCAP: Small-cap
Free cash flow growth (in CAGR): 42% Sales growth (in CAGR): 22%
Ratio of debt to equity (in times): Nil
The stock was held by 23 active mutual fund schemes.

The type of Bayer CropScience MCAP: Mid-cap Free cash flow growth (in CAGR): 40% Revenue growth (in CAGR): 19%
Ratio of debt to equity (in times): Nil
24 active mutual fund schemes owned the stock.

Gujarat Gas is a mid-cap company. Its free cash flow growth rate (in CAGR) is 36%.
(in CAGR): 28% growth in sales.
Debt-to-equity ratio (in times): 0.09 \sNo. of active MF schemes that held the stock: 87

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As part of the rebranding, the word “IDFC” will be replaced with “Bandhan” in the name of each scheme of the fund house.

Starting on Monday, March 13, 2023, IDFC Mutual Fund will be known as Bandhan Mutual Fund. As part of the rebranding, the word “IDFC” will be replaced with “Bandhan” in the name of each scheme of the fund house.

Also, Read – ICICI Prudential Nasdaq 100 Index Fund NFO: Should You Invest? | IPO Info

In a statement on March 11, the fund house said, “Since the underlying investment strategy, processes, and team remain the same, investors can continue to benefit from the same high-quality investment approach that the fund house is known for.”

Vishal Kapoor, CEO of the AMC, said this about the change in brand identity: “Our new name reflects our new sponsorship, and we are proud to now be a part of the Bandhan Group. Because of the history, goodwill, and openness of our Sponsors, we are sure that our investors will continue to get the same passion, expertise, and focus they have gotten over the years.

As part of its rebranding, the fund house has changed both its name and its logo. The statement says, “This rebranding to become Bandhan Mutual Fund marks a new chapter in the fund house’s journey and is expected to give its business new energy.”

Investors can visit the fund house’s new website at bandhanmutual.com starting on Monday.

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As more individuals seek to diversify their portfolios internationally, international funds are becoming increasingly popular. ICICI Prudential Mutual Fund has unveiled yet another international scheme to add to its extensive portfolio. The ICICI Prudential NASDAQ 100 index fund is an open-ended index fund that mirrors the Nasdaq 100 Index.

This blog describes the fund in detail and considers whether you should invest in the ICICI Prudential NASDAQ 100 index fund.

What is the purpose of the ICICI Prudential Nasdaq 100 fund?

The ICICI Prudential Nasdaq 100 Fund is an index fund that invests in the Nasdaq 100 index of U.S. equities.

As an index fund, the scheme will be passively managed, with the fund manager investing in the same proportion of companies as the index. Before expenses, the ICICI Prudential Nasdaq 100 fund will attempt to replicate the index’s performance. The new fund’s subscription period will end on October 11.

Let’s determine whether it makes sense for an investor seeking international diversification to invest in the ICICI Prudential Nasdaq 100 index fund.

Nasdaq 100 Index: What do you get?

To comprehend the types of companies in which the fund will invest, we must comprehend the index’s composition.

The Nasdaq 100 consists of the 100 largest non-financial companies listed on the American stock exchange. The United States is home to the world’s largest financial and technology corporations. Excluding the largest financial companies makes the index technology-heavy. Apple, Microsoft, Alphabet, and Facebook are among the top holdings of the index. In total, technology companies account for 44% of the index. The allocation to the top 10 holdings is approximately 53.38 percent.

Also Read: The NCD issue from Indiabulls Housing, which offers 10.15%, is now open; should you invest?

The following tables detail the index’s top holdings and sector composition:

How the Nasdaq 100 Index did

Compared to Indian stock markets, the Nasdaq 100 index has done well over the past few years. In the last 5 years, the Nasdaq 100 TRI index has had a CAGR of 34.6%, while the NIFTY 50 TRI index has had a CAGR of 18.8%. The performance of the Nasdaq 100 after 2019 has been helped by the rise in tech companies, especially during the pandemic.

People have changed how they live, work, and shop because of the pandemic. More and more people are going online. They do more online shopping, work from home online, and spend more time online to have fun. This has helped the FAANG companies, which are some of the most important parts of the Nasdaq index. FAANG stands for Facebook, Alphabet, Amazon, Netflix, and Apple.

The next graph shows how, over time, the Nasdaq 100 has done better than the NIFTY 50. If you had put Rs 100 into the Nasdaq 100 index in 2010, it would be worth Rs 1,494 now. The same amount put into the NIFTY 50 index would be worth Rs 379.

Also Read: How to Get Your Consolidated Account Statement in Three Easy Steps (CAS)

ICICI Prudential NASDAQ 100 index fund for international exposure?

As shown in the table, Nasdaq 100 index is tech-heavy. 30% of the portfolio is the top three index companies. Allocation is slightly higher. A portfolio focused on a few sectors and stocks may perform better in rising markets but may suffer more in falling markets. Technology stocks drive Nasdaq 100 index performance.

The index fund’s low expense ratio benefits you. Index funds have lower expense ratios and risk than actively managed funds.

If you want exposure to the US equity market without too much risk, invest in a fund based on a broad index like the S&P 500. It improves diversification.

S&P 500 tracks the largest 500 US stock exchange-listed companies. . S&P 500’s top sector, IT, has 28% weighting compared to 44% in the Nasdaq 100.

International funds that are not country-specific can help you diversify beyond US equity markets. ICICI Prudential Global Advantage Fund-of-Fund and PGIM India Global Equity Opportunities Fund invest in international mutual funds.

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Diversifying your investments can help you reach your different financial goals on time. But as you invest in different mutual funds, it can be hard to keep track of all your investments in different mutual fund schemes.

The Consolidated Account Statement, or CAS, can help you out. CAS gives you a quick look at all of the investments you own. It can also help you figure out how well your investments in mutual funds are doing.

It’s like a report card for your investments that shows you how they have grown over time.

What is a CAS, or Consolidated Account Statement?

Your CAS and PAN are linked (Permanent Account Number). Now, let’s say you’ve put money into mutual funds.

Your CAS would have all of the information about your mutual fund investments. These details include the date of the investment, the NAV at the time of the investment, the current NAV, the value of the funds invested, the current value of the holdings, and the returns.

Who takes care of CAS?

CAS is taken care of by a number of middlemen in the market.

Depositories such as

• NSDL stands for the National Securities Depository Limited.
• The Central Depository Services Limited, or CDSL,

Mutual fund transfer agencies like

• The CAMS stands for Computer Age Management Services.
• KFintech (formerly known as Karvy)

How do I get to CAS?

From any of these agencies, you can get to your CAS in the same way.

Here are the steps in general:

• Sign up on their website by giving them your PAN and email address.
• Make yourself a username and a password on their portal.
• To get to your CAS, log in to the portal.

Also Read: ESG filters prevent stock market shocks.

Can I get my CAS from time to time?

If you invested in a mutual fund scheme that month, you will get your CAS by email every month. This includes buying, transferring, or selling a mutual fund in that month. If you don’t do anything every month, you’ll get your CAS by email every six months.

Can I send for my CAS?

Yes, if you choose to have a physical CAS sent to your home.

To conclude

When you invest in mutual funds, it can be very important to keep track of your investments. It can show you if your investments are going in the right direction.

Your CAS contains details of all your investments across asset classes. It can be a good way to keep track of all of your mutual fund transactions, such as buying, selling, transferring, getting dividends, and cashing out, in one place. In other words, it also serves as a passbook for your investments.

The fastest ways to get your CAS online are through the following sites:

• NSDL stands for the National Securities Depository Limited.
• The CDSL stands for Central Depository Services Limited.
• The CAMS stands for Computer Age Management Services.

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

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Why an ELSS is a good option for long-term investors? The only pure equity investment in the Section 80C tax deduction basket is an equity-linked tax-saving scheme (ELSS) or tax-saving mutual fund plan. But you should also check your EPF and PFF contributions to figure out how much you really need to put into an ELS.

Some investors find out around the middle of March that they haven’t finished their tax-saving investments. And the search makes them want to find easy solutions. If you are also looking for an investment that will help you save money on taxes, you might want to think about equity-linked savings schemes (ELSS). Which are often called tax-saving schemes.

What are ELSSs?

Tax-savings schemes are mutual funds that invest at least 80% of their money in stocks. Most of the time, they have all of their money in a portfolio of different stocks. Investors can’t sell their units of these schemes for three years after they are given them. Investments up to Rs 1.5 lakh per year are tax-deductible under Section 80C.

Value Research says that over the last three and five years, ending March 8, 2023, these schemes have given an average return of 17.77% and 10.79%. In the past, ELSS has done better than other tax-saving investments over a longer period of time.

Even though Dalal Street has been volatile over the past year, experts are optimistic about stocks in the future.

Also Read: A standard insurance plan will cover mental health, disabilities, and HIV/AIDS.

Which ELSS?

There are 38 ELSS in the mutual fund industry, and it can be hard to decide which one is best for you. Except for two, every ELSS is actively managed.

Flexi-cap portfolios are typical. The fund manager can choose attractive stocks from any market capitalization. Large-cap stocks held 72% of money as of February 28, 2023. Actively managed schemes favor mid and small-cap stocks. In uncertain times, these investments can be scary, so choose one with a good track record. MC30 is a mutual fund selection.

“Over the long term, actively managed ELSS have done better than any other way to save money on taxes. To build wealth with ELSS, you need to have a long-term investors view of stocks and keep your investments for at least five to seven years, no matter how volatile they get.

He adds, though, that people who want their ELSS to give them access to large-cap stocks should choose passively managed ELSS funds.

Last year, India’s financial markets regulator, SEBI, allowed mutual fund companies to offer passively managed ELSS, but with a catch. . It allowed people with an actively managed ELSS to start a passively managed one if the fund house stopped accepting new investments.

Advice on how to get the most from your ELSS investment

How much space do you have in Section 80?

Under Section 80C, you can put up to Rs 1.5 lakh into investments. You can invest more, but you will only get a tax break on your income up to Rs 1.5 lakh.

Check your current contributions to the employees’ provident fund, life insurance premium, National Saving Certificate, tuition fees, public provident fund (PPF), and other eligible investments. If you still don’t have Rs 1.5 lakh, you should put the rest of the money into an ELSS.

Also Read: 7 UNIVERSAL THUMB RULES When It Comes To Investing

How many ELSS do you need?

Do not go overboard. Roshni Nayak, the founder of Goalbridge and a SEBI-registered investment advisor, thinks that a portfolio only needs one ELSS. “Most ELSS funds invest 60–70% of their money in large-cap stocks and the rest in mid-cap and small-cap stocks. Investors often put their money into more than one ELSS fund to save on taxes each year. This makes the portfolio have too many of the same things,” she says.

After three years, should you quit?

No, not always.

Even though you can cash out your ELSS investment after three years, you don’t have to. You can let your money grow over time. But when money is tight, units that have been locked in for three years can be sold and put back into ELSS to get tax breaks for that year.

When you sell ELSS units, you make long-term capital gains. Which are taxed at 10% if they are more than Rs 1 lakh in a given year.

SIPs invest slowly, but they also pay out slowly.

Since ELSS are tied to stocks, which are a risky asset class, you should spread out your investments. As the end of the financial year gets closer, there is less time to do so. But you might learn something from this: start investing to save on taxes early in April and spread them out over the year to get the most out of rupee cost averaging. SIP is a set of regular investments of the same amount into mutual fund schemes.

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7 UNIVERSAL THUMB RULES When It Comes To Investing Mention Below:

RULE OF 72

We all want the value of our money to double as quickly as possible, and we are all looking for ways to make that happen as efficiently as possible. The number of years it will take to see a doubling of your investment can be calculated using the rule of 72.

If you take 72 and divide it by the rate of return that is expected, you should be able to get a very accurate estimate of the amount of time it will take for your money to double if you use this strategy. To better grasp this principle, let’s look at an illustration, shall we? Let’s say you purchased something that promises a return of 6% on your investment of Rs 1 lakh. The answer that you get if you divide 72 by 6 is the number 12.

That means that in twelve years, your one thousand rupees will have grown to two thousand rupees.

It is essential to keep in mind that this guideline applies exclusively to investments that generate compound interest.

You can also figure out how much interest you’ll need to pay based on something called the Rule of 72 if you want your money to double in value within a specific amount of time. To calculate the interest rate, for instance, if you want your investment to double in five years, you need to divide 72 by the amount of time it will take for the investment to double. This will give you an interest rate. I.e., 72/5= 14.4%p.a. Therefore, in order to receive twice as much, you should receive an annual interest rate of 14.4%.

RULE OF 114

This rule will tell you how long it will take for your money to triple in value, whereas the “rule of 72” will tell you how long it will take for your money to double in value.

The investing rules of 114 enable you to get a relatively accurate estimate of the number of years it can take for your investment to triple by utilising the same line of reasoning and mathematical formula.

Rule 114 states that if you invest 1 lakh with a return of 6% per year, your investment will grow to 3 lakhs after 19 years.

Similarly. If you want to see a return on your investment in five years. Simply dividing 114 by 5 will give you an interest rate of 22.8% per annum, which will allow your money to triple in just five years.

Also Read: SEBI wants mutual funds to “own their broking”

RULE OF 144

Rule 144 is the next rule of thumb to consider when making investments in mutual funds. Rule 144 is calculated by multiplying rule 72 by 2. Because of this, the so-called “rule of 144” can be easily understood as a tool for calculating the number of years it will take for your money to increase by a factor of four if you are aware of the rate of return.

For instance, if you invest Rs. 1 lakh in a product that has an interest rate of 6%, your initial investment will grow to Rs. 4 lakh after 24 years if you follow the guidelines outlined in Rule 144. Simply dividing 144 by the interest rate of the product will get you the answer to the question of how many years it will take for the money to quadruple in value.

100 MINUS AGE RULE

The rule of 100 minus one’s age is an excellent method for determining how one should allocate their resources. To clarify, the question is how much of your money should be invested in equity funds, and how much should be put towards paying off debt.

According to the rule regarding investments, you are required to subtract your age from 100. The proportion of equity exposure that is appropriate for you is the result of this calculation. You could purchase debt with the remaining funds if you so choose.

Let’s say, for example, that you are 25 years old and want to invest Rs 10,000 every single month. If you invest using the 100 minus age rules, the proportion of your portfolio that is allocated to equity will be 100 minus 25, which is equal to 75 percent. Then you should put 7,500 rupees into the stock market and 2,500 rupees into debt. In the same vein, if you want to invest Rs. 10,000 and are 35 years old, your equity allocation should be 100 minus 35, which equals 65 percent, according to the same rule. That indicates that you ought to put 6,500 rupees into shares and 3,500 rupees into debt.

RULE REQUIRING A MINIMUM INVESTMENT OF 10%

According to this general rule of thumb, potential investors should begin their investment strategy by allocating at least 10% of their current salary, and then continue to increase this allocation by 10% annually as their total compensation grows. If you want to take full advantage of the power of compounding, the best way to do so is to begin investing at an early age. Investing in your future can provide many benefits if you get a head start when you’re young. Shopping on the internet and spending money needlessly can wait.’

Also Read: Indian markets will do better and better than other markets.

EMERGENCY FUND RULE

In the same manner as the rules requiring a minimum investment of 10% of your income, you are required to contribute a portion of your salary towards the emergency fund. Because you never know when life will hand you a curveball, it is imperative that you have a solid financial foundation. As a result of this, it is recommended that you save money for unexpected expenses before you start investing. In accordance with this piece of advice, you should put money aside that is equivalent to at least three to six months’ worth of your monthly expenses.

An emergency fund needs to be easily accessible during times of crisis, and maintaining its liquidity is the best way to avoid any potential monetary strain.

RULE OF WITHDRAWAL OF 4%

If you want your retirement savings to outlive you, the 4% withdrawal rule is a good rule of thumb to follow. If you follow this guideline after you retire, you will ensure that you have a consistent income. On the other hand, you still have a sufficient amount of money in your bank account to generate adequate profits.

For instance, if you have a retirement corpus of one million rupees, the 4% withdrawal rule dictates that you should withdraw 40,000 rupees each year, or 33,000 rupees each month, in order to maintain your standard of living despite the effects of inflation.

SUMMING UP

The “thumb rules” for investing that have been presented here are general guidelines and principles that each and every investor ought to adhere to. Caution is the defining characteristic of a successful investor, and before you begin investing, you should do your research and discuss your options with a qualified investment professional. Because of this, it is extremely important to stress that these guidelines should not be followed in a mindless fashion. Keep in mind that building a strong investment portfolio can help you achieve your monetary objectives, provided that you take into account your ability to tolerate risk and the amount of time you have to achieve your goals.

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