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Mutual Fund Corner: Will I be able to create Rs 2 crore with these schemes?

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Get all your mutual fund related queries answered by our expert, Anurag Seth, on our show Mutual Fund Corner.

Mutual Fund Corner: Will I be able to create Rs 2 crore with these schemes?
Want to invest in mutual funds but don’t know how to go about it?
Get all your mutual fund related queries answered by our expert, Anurag Seth, director and head, global wealth management, Quant Capital, on our show Mutual Fund Corner.

Q: 25-year-old Jannali Jaya Durga Devi writes us from Tamil Nadu. Invested in ABSL Frontline Equity Fund, Kotak Standard Multicap, ABSL Equity Fund and DSP Equity Opportunities Fund. I do SIP of Rs 5,000 and I am a very conservative investor. I can invest for 20 years. My goal is to create a corpus of Rs 2 crore. I want to invest in an ETF Fund. Can you please suggest me an ETF Fund?
A: At the age of 25, you shouldn’t look at a conservative approach. Nevertheless, your selections of the fund are good enough as the funds are in the large-cap and multi-cap segment, as you want to be in the conservative category. Investing Rs 5, 000 per month for the next 20 year, till you are 45 years old, will give you a corpus of:
SIP amount Rs 5,000
YearTenure (Yrs)ROI%Future Value (INR)
20392010%38 lakh
20392012%49 lakh
20392015%75 lakh
So I feel you have to increase your monthly SIP amount to Rs 26,500 to achieve your goal of Rs 2 crore.
SIP amount Rs 26,500
YearTenure (Yrs)ROI%Future Value (INR)
20392010%2.01 crore
20392012%2.62 crore
20392015%3.97 crore
Exchange Traded Funds are essentially index funds that are listed and traded on exchanges like stocks. They enable investors to gain broad exposure to entire stock markets in different countries and specific sectors with relative ease, on a real-time basis and at a lower cost than many other forms of investing. An ETF is a basket of stocks that reflects the composition of an index, like S&P CNX Nifty or BSE Sensex.
The ETFs trading value is based on the net asset value of the underlying stocks that it represents. Think of it as a mutual fund that you can buy and sell in real-time at a price that changes throughout the day. Before getting into ETF’s, you need to understand it properly. You can select any of the ETF, sector or index wise to invest.
Find the list of ETF’s for reference.
 
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Disclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.
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