Dear Radika Nandlal.

You should not Redeem any ULIP till next 1 year. Continue as PAID up( Insurance cover Continue without Paying Further Premium After 3 years if Insurance cover is high not 1-2 Lacs). If Insurance cover is less, Surrender the ULIPS after 1 year or so .

LIC Conventional Policies may be Redeemed after understanding the Losses ( These may not have Investments in Stock be Market ).

AVOID Loan against Conventional Policies.

P.C.Sharma...

Dear Radhika Nandlal,

I have not studied Jeevandhara & other Policies of LIC Except few ULIPS. Hence I can not comment on this.

Pension Plans should be Avoided due to Adverese Tax Laws & very LOW Returns of ANNUITY.

You may Discontinue Further Premium Payment after Carefully understanding Consequences & Possibility of Loss of Principal .

Equity Mutul Funds are the BEST Option. Invest by SIP & Opt for SWP after Retirement.

P.C.Sharma

...

Dear Shrikant,

IRDA has no authority to BAN or ALLOW Mutual Fund Houses to offer Free Life Insurance Covers to MF Investors because Group Insurance is offered by IRDA Approved Insurance Companies ( which happens to be SISTER CONCERNS of MF HOUSES).

The Decision to Discontinue the FREE Life Insurance cover was taken by Life Insurance COUNCIL which is a sort of UNION / ASSOCIATION of ALL INSURANCE Companies.

I Expect that in future other MF Companies like HDFC,SBI,HSBC, ICICI,
Canbank, Bharti AXA, TATA, SAHARA etc. may also offer FREE Life Insurance Covers to MF SIP Investors.

This will be EXCELLENT for Future for GROWTH of Mutual Funds.


P.C.Sharma









...

I recived a small Publication from SBI MUTUAL Funds last month.It is an EYE OPENER for Investors.

It contains SIP & SWP Returns of SBI CONTRA & other 2 Funds during 3 years.

If somebody Invested Rs.20 Lacs in SBI CONTRA Fund on 1st July,2005(3 years Ago), & Opted for SWP of Rs.25000 Per month(Recieved 9 Lacs in 3 Years),the Fund Value was over Rs. 31 Lacs on
1st July 2008(after 3 Years). It means his returns are 9 lacs + 11 Lacs = 20 Lacs.

Detail study shows that 20,00,000-25000
per month grew to 36 LACS in May,2006 &
then Declined to 29 LACS in June 2008.

FV again GREW to 37 Lacs in Feb.2007 & then Declined to 32 Lacs in April,2007.

This amount Again GREW to 55 Lacs in Jan.2008 & then Declined to 31 Lacs in July 2008.

Thus GAINS of 36 Lacs were WIPED off during 3 Market CRASHES.

If somebody had Implemented the Asset Allocation theory ( Rebalancing after Every 10% Growth in Equities), his Returns Could have been over 200% instead of just 100%.

Although TIMING the Market is IMOSSIBLE
but Profit Booking is NOT CRIME.
PROFIT BOOKING is Absolutely necessary in Long Term Investments also.

Some Fund HOUSES ( Reliance,JM, UTI, Kotak etc.)offer TRIGGER Facility
( Automatic Profit Booking when NAV Appreciates by certain Pre-Determined percentage ).Another Simple Method is Dividend Payout.

Intelligent Investors should learn from Mistakes & IMPROVE the Investment
SKILLS regularly instead of following the AGE OLD Theories ( mostly BORROWED from WEST) of so called Finsancial Advisors.

P.C.Sharma




























...

Dear boysi,

This is most Appropriate Time for Investment in Equity Funds if your Time Horizon is 2-3 YEARS or MORE.

You may Consider Investment in any one or more Funds by SIP / STP as mentioned below:

DSPML Top 100 Equity Fund
HDFC Growth /Top 100 Fund
Franklin PRIMA PLUS
IDFC Imperial Equity Fund

If your are afraid of short Term Volatality, DSPML Balance Fund / UTI MAHILA UNIT Scheme is GOOD Options.

No need to Invest in DEBT Funds.

P.C.Sharma


...

Dear Rohit Nanda,

Investment in Following Largecap Oriented Funds may be GOOD Option.

DSPML Top 100 Equity Fund
DWS Alpha Equity Fund
HDFC GROWTH / Top 200 Fund
IDFC Imperial Equity Fund
Sundaram Select Focus Fund.

Among New Funds I am monitoring the Performance of Reliance Quant Plus Fund * ICICI Focussed Equity Fund.

P.C.Sharma
...

Dear NITIN,

I have not studied much about Term Plans but I know Premiums of Following are Cheaper.

Please take Illustrations from SBILIFE,METLIFE,KOTAK & ICICI Prudential for Pure Term Insurance ( Without any Return) & then Take 2 Covers of 15 Lacs each.

I would Prefer ULIPS of IDBI & Metlife.

15000 per year in IDBI Wealhssurance for 5 years & Cover of 15 Lacs.
18000 per year in Metlife Smart PLUS for 5 years & Cover of 14,40,000

P.C.Sharma

...

Yes i have no loans until now... i wanted to take a housing loan to build on top of my parents house..but i am not working so no loan will be given.. Will they give against policies i wonder.... i thought i should begin some business and the best place of course is the terrace of my parents home.. lets see..... nobody is giving loans against fixed deposits etc i think... now SBI is giving 11% interest onf FD.....

Dear Sharmaji, Thanks for throwing light on the subject. If, as you said, all Mutual Fund companies start offering Insurance covers, it will be great for Investors. I hope it happens soon. Regards, Srikanth shankar Matrubai ...

pcspune, My hubby i feel bought a dumb insurance policy going by the name Jeevan Dhara... when i looked into its scheme i got the shock of my life.. no lump sum payment to my kids on my death and no lump sum payment to me when i am alive. Whats the use of such a policy and i dont understand how my hubby so shortsighted to buy this.. The details of the policy are Jeevan Dhara plan Term 15 years notional cash option Rs 20 lakhs Amount of annual annuity 2L Is this a pension plan as i dont see anywhere mention of a bulk amount payable to me I am really not keen on pension plans as i would like to have bulk money. Would you kindly recommedna health insurance for me, i dont have one as of now and i am 46 years old in good health wiht no BP or sugar or any chronic problems....

Hi PCS This is where I am in doubt. Religare: 30L for 30 years: 8798 [7830 + taxes] Birla: 30L for 30 years Dream plan 9005 (taxes included) I havent seen any cheaper than Religare. Can u suggest a term plan for me (31 years) where I may get a cover of 30L in 6-7k? Or can u suggest a ulip i can invest in say for 15L and I take a 15L cover using term plan Please help me...I am kind of confused. Thanks nitin...

Hi Raj/Ashal/PCS I was myself in doubt and hence got the illustration from Birla folks. As per Dream plan: My age : 31 Cover: 30L Years: 25 Premium: Rs 9005 Guaranteed maturity Benefit 25K PAC: 0 Mortality charge: for 30L for 25 years is 6253 per year (constant) Settlement period is 5 years after maturity: @ 10% -- 283045 @ 6% 122315 My age : 31 Cover: 10L Years: 25 Premium: Rs 4705 Guaranteed maturity Benefit 25K PAC: 0 Mortality charge: for 10L for 25 years is 2229 per year (constant) Settlement period is 5 years after maturity: @ 10% -- 259642 @ 6% 116176 What do you think? Thanks Nitin...

Dear Sharmaji, The book uses American Stock market data for its comparisions. Since ours is a more volatile market, the VA concepts will work better for us. Something interesting I found from the book is that, based on US data from 1962 to 1991, the author says VA works best on quarterly frequency. Surprisingly even for dollar cost averaging, quarterly frequency is as good as monthly frequency and both of these are better than daily and weekly frequency. I always thought shorter the frequency, the better. But that was not the case when compared over a period of 30 years based on the US markets. Thanks, Raj...

Hi PCS I know this may be wrong thinking....but heres a question: If I take 30L for 30 years... HDFC 3550 - 10L for 30 years Reliagare 2000 - 10L for 10 years SBI 2610 - 10L for 20 years Total: 8.5K for 30 years (decreasing) with tax Birla Sunlife - 9000 for 30L for 30 years and guarantee 75K after maturity I get 30L for 30 years (instead of decreasing) and rate is nearly same (500 Rs more) What do u think? Thanks nitin ...