Atul Rastogi (for Info only, not official)

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Atul Rastogi

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    ...To corroborate the investor’s point, a recent study shows that investors’ folio returns were almost 5-6% lower than fund returns over a full market cycle—or a period of about 10 years. Why is that so? Apart from factors like loads (not there any more), the most important reason is timing of entry and exit. Investor behaviour is aligned towards starting equity investments when markets are touching new highs and exits when markets are touching lows. Even for individual portfolios, equity allocations rise when markets are high and decrease when they are low. To avoid this behaviour, a bright solution was SIP (systematic investment plan), where you invest a fixed amount periodically. The idea behind an SIP is regular investment and avoiding market timing. ...

    Live Mint on Dec. 5, 2017, 4:57 p.m.

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    ...The company has grown exponentially since then, but the message has remained almost the same—maximum products, lowest prices. Bezos has famously mentioned that his strategy has focused on things that do not change rather than on things that are changing. Today, everything is changing fast, or so it seems so. The way we eat, live, work and play, is very different from our parents and is likely to be different for our children too. Change is always exciting and certainly creates massive growth and big opportunities. However, change is easier to spot but difficult to endure, as things which change, tend to keep changing, and keeping up can be tough; more so for businesses and investors. For instance, IT and telecom companies are finding it tough to keep up with the new technologies and regulations, and similar disruptions could happen in medicine and transportation. Can we apply the same Amazon principle to managing our investments? ...

    Live Mint on Aug. 28, 2017, 5:28 p.m.

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    ...On 3- and 5-year basis too, the average large-cap fund is up 15-17% annually. Even debt funds have had a good run with income funds giving almost 10% returns for past 3 years and long-term gilt funds returning 12% compound annual growth rate (CAGR). With such a good track record, money is pouring into both equity and debt funds. Investors are convinced that these are the best investments and advisers are only pleased to ride on. The common refrain is: “Market might correct a bit in near term, but equities will surely make 12-15% over 3-5 years” or “bank deposits rates are so low; debt funds give better returns, with the same low risk”. It was only 5 years back that you could not lose money in real estate, and now real estate is dead. The overwhelming consensus now is that equities or funds are the best asset class. ...

    Live Mint on April 30, 2017, 10:56 p.m.

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    ...An investor can reduce the overall portfolio risk by diversifying across instruments or asset classes. The fundamental underlying principle of this theory is that markets are always efficient and it is almost impossible to find anything investible that has low risk and high return. But if one looks at the real world, does this relationship hold up? If it were true, then the most successful investor would be the one taking the highest risk. But we know it is the reverse. Almost all successful investors, and successful businessmen too, are highly risk averse. They give topmost priority to protecting capital, but that does not mean that they generate low returns. On the other hand, those taking high risks repeatedly end up going bankrupt. So, how do these investors make superior returns with low risk. ...

    Live Mint on March 19, 2017, 11:41 p.m.

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    ...For most salaried people, tax liability and cash flows occur uniformly throughout the year and ideally, investing in should form part of the plan. But more often than not, we end up investing in whatever is available at that moment, rather than trying to fit the tax-saving instrument in our portfolio. I have come across investors with multiple tax saving instruments—bonds, equity-linked mutual funds (ELSS), single-premium policies, multiple unit-linked policies… all in one portfolio. There is a tendency to forget that tax saving is just one of the features of the product, albeit an important one. More important are the returns and the risks with the product. Most tax-saving instruments are at two ends of the risk-return spectrum—either very low-risk, low-return like Public Provident Fund (PPF) or insurance; or high-risk, high-return like ELSS (predominantly mid-cap oriented equity mutual funds). ...

    Live Mint on Feb. 8, 2017, 5:58 p.m.

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    ...Whether the economy and the equity markets will bounce back after the initial shock, or we could see an extended slump, is a hot topic but we won’t discuss that here. What appears clearer is that lower interest rates and lower inflation are here to stay, helped by a combination of huge liquidity in the banking system and still weak aggregate demand. From an investor’s perspective, this is possibly the most critical variable. Indian investors are not used to low rates. The only period when rates declined was in 2001-03, when g-sec yields declined by almost 600 bps. That also was a period of declining rates, not steady low rates. In a declining rate scenario, bond prices do well and hence one can shift portfolio towards bond or g-sec funds. The latter gave more than 25% compounded annual growth rate over 2000-03. ...

    Live Mint on Nov. 28, 2016, 12:02 a.m.

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    ...In other words, the intermediary will be paid by the customer and not the manufacturer (mutual fund houses, insurance companies, or similar others). There seems to be a global wave towards this fiduciary model and regulators in many countries are taking steps in the same direction. To my mind, the biggest change will be a shift of power from the manufacturer to the investor. Let me explain. In the current scenario, an agent or distributor is appointed by an asset management company (AMC) or insurance company to sell its products for a commission. The agent also receives training, inputs on various products and help in acquiring and servicing customers. Thus, she is obliged to sell or promote the company that helps her more than the others. In the new scenario, the tables turn as the customer is the only one who pays the adviser. ...

    Live Mint on Oct. 27, 2016, 4:01 p.m.

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    ...And then you have to basically just wait.Amid all the excitement that may or may not be happening around your pick, you have to just hold on to it—a rather uninteresting proposition.Warren Buffett also said that the first principle of making money is to stop losing money.In other words: be focused on the downside and lower your risks.To put it in foolproof words: don’t do anything foolish.In practice, this could imply buying when no one else is buying, and seeing the stock or fund languish for a long time or move slowly and steadily.No one may be talking about that stock on television or in the newspapers.Or, it could mean buying a plain vanilla equity fund regularly, which diversifies across sectors and stocks.It doesn’t feature as the top-performing fund and doesn’t get any awards.How boring! ...

    Live Mint on Sept. 29, 2016, 4:14 p.m.