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Chart Ki Baat
Gyaan Ki Baat
An Equity Savings Fund is an interesting category for those who are looking to allocate some money for 5-6 years with an intention to outperform Bank FDs but not take a pure play equity market risk.
Equity Savings Fund invest approximately 30%-35% of total investment corpus in equity assets while the rest is invested in debt income funds and arbitrages. This allocation makes them an interesting choice for two reasons –
1) The allocation creates a balance where equity market linked risk is limited to 1/3rd of the corpus. This will lead to outperformance over Bank FDs over a 5–6-year period. But it also limits the downside in case there is a market downturn.
2) Qualifies them to be taxed as equity funds. Thus, they are way more tax efficient as compared to pure debt instruments.
Here’s the list of curated readings for you this week:
- It never gets easier – The never-ending cycle of competition and achievement leads to disappointment in career for most, prompting a deeper probe into your ‘why’? Read here
- The joy of walking away – Material prosperity and validation, while essential, are not usually indicators of a fully satisfying and well-rounded existence. The article delves into why Peter Lynch delves chose an early retirement.Read here
- Shift In Savings Curve? – Investors will need to consider reinvestment risks on maturing investments made during the high interest rate environment.Read here
- PPFAS letter to unitholders – The Director of PPFAS Mutual Fund highlights their overall market outlook, addition to product offerings and portfolio construction approach. Read here.
- Indians yet to warm up to lab-grown diamonds – According to Titan, Indians are reluctant to embrace lab-grown diamonds unlike in the US. They view diamonds as an investment as well jewellery. Read here
- Robin Hood NYC 2023 – A chat between Stan Druckenmiller and Paul Tudor Jones discussing the US economy – how different will the post quantitative easing world look like? Will interest rates have a new normal? Read here
- GST collections: signify economic resilience – Continued growth in tax collections is a positive sign for the fiscal outlook, showing the economy’s strength. Read here.
- AI in Banking – Banks are embracing generative AI, which offers potential for increased earnings, enhanced decision-making, and improved risk management. Read here.
- Why China is flirting with deflation as the west battles rising prices – As central banks in developed countries struggle with persistent high inflation, China faces the opposite challenge – the world’s second-largest economy is on the brink of deflation. Read here
- India’s economy and markets around elections – The article summarizes theimpact of previous election cycles have on the growth, inflation, fiscal balance, FPI investments and currency of the country. Read here
- India’s Rapid Progress in 5G! – According to Ericsson’s report, India has embraced 5G at a faster rate than other early global adopters. This is evident in their active usage of digital apps and services such as streaming, gaming, and augmented reality. Read here
- What Could Move Oil Prices from Here? – The Israel-Gaza conflict has sparked concerns about its potential impact on the oil industry and the threat it poses to the global economy and markets. Read here
Check out CAGRwealth smallcase portfolios here.
That’s it from our side. Have a great weekend ahead!
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The content of this newsletter is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information outlined in this newsletter unless mentioned explicitly. The writer may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated in this newsletter.