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Mutual Funds

Chart: Five Years of Nothingness


Or almost. Invest using SIP they said. Every month, month on month, you invest money, buying into the Nifty, and your return today, after five years, is a miserable 5.20% per year.


This is the lowest five year SIP return since July 2003.

I’ve also shown the impact of buying Nifty as a lumpsum (current 5 year return: 4% annualized), and including dividends (Current 5 year return: 6.34%).

You would have done better with a fixed deposit. All those mutual funds complaining about lack of customers? Or broking companies lamenting the lack of investors? This, sirs, is the reason. When you don’t have returns, you don’t have retail investors. They always FOLLOW; they’ll come back when the returns are fantastic again.


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