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The document discusses the Goal Achievement Programme Through Mutual Fund SIPs (GAP) which helps investors systematically invest in mutual funds to achieve long-term financial goals like child's education, marriage, retirement, etc. It emphasizes the importance of starting early, investing regularly through SIPs, and choosing the right asset class like equity to beat inflation and achieve goals. Long-term data shows that despite volatility and crises, SIP returns in diversified equity funds have grown at an average of 19.34% over 15 years.
The document discusses the Goal Achievement Programme Through Mutual Fund SIPs (GAP) which helps investors systematically invest in mutual funds to achieve long-term financial goals like child's education, marriage, retirement, etc. It emphasizes the importance of starting early, investing regularly through SIPs, and choosing the right asset class like equity to beat inflation and achieve goals. Long-term data shows that despite volatility and crises, SIP returns in diversified equity funds have grown at an average of 19.34% over 15 years.
The document discusses the Goal Achievement Programme Through Mutual Fund SIPs (GAP) which helps investors systematically invest in mutual funds to achieve long-term financial goals like child's education, marriage, retirement, etc. It emphasizes the importance of starting early, investing regularly through SIPs, and choosing the right asset class like equity to beat inflation and achieve goals. Long-term data shows that despite volatility and crises, SIP returns in diversified equity funds have grown at an average of 19.34% over 15 years.
GAP GAP CHILDS MARRIAGE Good plans shape good decisions. That's why good planning helps to make elusive dreams come true. Geofrey Fisher YOUR OWN RETIREMENT To enjoy a long, comfortable retirement, save more today. Suze Orman CHILDS HIGHER EDUCATION The one thing we can do is invest in the quality of education, especially higher education. Ron Kind GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP Dear Investors, NJ GAP is an idea to help you achieve your long-term goals at the right time by investing systematically in the right avenues through Systematic Investment Plan (SIP). NJ GAP helps you direct your savings to meet the goals, obligations & dreams like buying a house, higher education, marriage, retirement, luxury etc. and enjoy life. We believe that with proper planning, right approach and disciplined behaviour anything is possible to achieve in life. Wishing you all the best. GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP Presenting INFLATION THE BIGGEST HURDLE IN YOUR FINANCIAL GOALS ACHIEVEMENT As per RBI estimates WPI infation has grown by 6.8% in the last 30 years Reduced value of money @ 8% infation p.a. R1,00,000/- 1995 2003 2013 R65,908/- R33,825/- R14,693/- 1990 How Infation is eating your Money 3200 5600 29663 10.2% 9.84 32.49 75.80 9.3% 4.08 21.21 56.80 12.1% 6.00 13.00 38.00 8.4% 1990 2003 2013 Actual Inflation GOLD PETROL DIESEL MILK GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP INFLATION RETIREMENT CHILDS HIGHER EDUCATION 2005 2013 2025* 2005 R15,000/- R25,000/- R60,000/- 2013 2025* HIGHER EDUCATION HOUSE HOLD EXPENSE R3.16 lacs R14.45 lacs R36 lacs *Cost in the year 2025 assumed at 8% infation p.a. on 2013 prices CHILDS MARRIAGE PLANNING 2005 R4-5 LACS R10-12 LACS R25-30 LACS 2013 2025* MARRIAGE COST Fees of PGDBM in IIM - Ahmedabad GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP ACHIEVING GOALS THE RIGHT WAY TO CREATE LONG-TERM WEALTH? Buying potential BIG WINNING STOCKS? Successfully TIMING MARKETS Following EXPERT recommendations Saving a LOT OF MONEY GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP INVEST IN RIGHT ASSET CLASS THE RIGHT WAY SIMPLE , SMART & TIME TESTED FORMULA TO ACHIEVE GOALS START EARLY SAVE REGULARLY GOAL ACHIEVEMENT = + + GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP START EARLY GIVE TIME TO YOUR INVESTMENT RATHER THAN TIMING AND BENEFIT FROM THE POWER OF COMPOUNDING MR SAXENA MR GUPTA SAVING STARTING AGE 25 YEARS MONTHLY SAVINGS R 5,000/- SAVING TILL AGE 60YRS 35 YEARS TOTAL AMOUNT SAVED R 21 LACS WEALTH AT AGE 60 YRS R 5.70 CRORES 45 YEARS R 15,000/- 15 YEARS R 27 LACS R 0.92 CRORES 0.92 CRORES 5.70 CRORES 25 YEARS 60 YEARS 45 YEARS Systematic investing has a compounding efect on your investments. In the long term, an investment as low as R 5000/- per month swells up into a huge corpus. This can be best explained by the following graph. The graph shows advantages of starting early. If an investor starts early, even with lower invested amount he can create a large corpus. The above example is merely an illustration to explain the beneft saving at an early age. Returns are assumed at 15% CAGR. Assumed that SIP investment are done regularly every month. No guarantee or assurance of return is being ofered by any mutual fund or NJ. The actual result may vary from depicted results depending on scheme selected. GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP RIGHT ASSET CLASS EQUITY MARKET HAS OUTPERFORMED ALL OTHER INVESTMENT AVENUES It is evident from the graph that in the long term, equity investments have outperformed other investment avenues and has beaten infation by a huge margin. Growth in Diferent Asset Classes from 1981-2013 Source: Gold-Handbook of Statistics on Indian Economy, RBI. Silver - Handbook of Statistics on Indian Economy, RBI. Sensex - www.bseindia.com, Slide of PPT of HDFC MF. Co Deposits - assumed (1% higher than Bank FD Rate). Bank Deposits - Handbook of Statistics on Indian Economy, RBI. Infation - Handbook of Statistics on Indian Economy, RBI Equity mutual funds over a long-term horizon ofer better risk-return pay of Liquidity, Transparency and Convenience + 15.5 9.8 8.8 10.3 3.2 9.6 2.6 6.8 INFLATION GOLD SILVER BANK DEPOSITS CO. DEPOSITS SENSEX 2.8 1.8 8.1 18 16 14 12 10 8 6 4 2 0 Actual Gain Real Gain 86,518 7,780 17,167 20,863 18,350 13,534 INFLATION GOLD SILVER CO. DEPOSITS BANK DEPOSITS SENSEX 90000 80000 70000 60000 50000 40000 30000 20000 10000 0 Growth of Rs. 1,000 in Diferent Asset Classes GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP INVEST REGULARLY DISCIPLINED INVESTING THROUGH SYSTEMATIC INVESTMENT PLAN (SIPS) Every investor dreams of buying at a low price and selling at a higher price. But, how does one know whether any given time is the right time to buy or sell? Many retail investors try to judge the market movements and end - up losing their money in the long term. A more successful strategy is Rupee Cost Averaging wherein you invest a fxed amount regularly. Thus you purchase more when the price are low and purchase less when prices are high. SIP investments takes advantage of this strategy. SYSTEMATIC INVESTMENT PLAN (SIP) AN IDEAL WAY TO REDUCE RISK AVERAGE COST PER UNIT < AVERAGE PURCHASE PRICE PER UNIT 1000 1000 1000 1000 100.00 125.00 111.11 90.91 4000 0 0 0 400 0 0 0 400 4400 @ NAV R11 10 427.02 4697.22 @ NAV R11 9.36 1 2 3 4 10 8 9 11 The above example is merely an illustration of Rupee Cost Averaging. The NAVs and returns generated are purely indicative and do not depict the performance of any mutual fund scheme. The actual results may vary from the depicted figures. No guarantee or assurance of return is being offered by the Mutual Fund or NJ. (R) (R) (R) (R) Rising Market Market Unit Purchased Falling Market Unit Purchased Market GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP SENSEX RETURNS EQUITY NOT RISKY IN LONG TERM 266.88 -46.78 25.02 34 22 12 35.29 81.76 -15.21 18.42 32 26 6 18.75 53.04 -4.77 17.48 30 27 3 10.00 34.71 -2.09 17.20 25 24 1 4.00 33.94 2.24 16.64 23 23 0 0.00 27.40 6.49 15.81 20 20 0 0.00 Past Performance may or may not sustain in future. The scenarios depicted herein above is for illustration purpose only and do not represent any forecasted performance. The above data shows returns for investments done in sensex every year on 31st March starting from 1979 till the year 2013 and is based on data available on www.bseindia.com which depicts performance of BSE sensex over a period of time. It shall not be construed to be indicative of scheme performance in any manner. Reducing probability of loss with increased investment tenure GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP Best market timing (almost impossible) has yielded less than 2% additional return than systematic investment. Time to go systematic. TIME IS IMPORTANT MARKET TIMING DOES NOT MATTER OVER THE LONG TERM INVESTING IN THE BSE SENSEX - 26 YEARS Period from Jan 1988 to December 2013 11.85% 14.65% 13.33% Data source: www.bseindia.com; capitalmarket GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP SENSEX RETURNS SENSEX HAS DELIVERED THESE RETURNS INSPITE OF Two Wars Major fnancial scandals Assassination of 2 Prime Ministers At least 3 recessionary periods 10 diferent governments An unfair share of naturals disasters Global crisis like Dot Com bubble of 2000 and Sub Prime crisis of 2008 YEAR SENSEX INVESTMENT 1979 100 R1,00,000 2013 21,171 R2,11,71,000 *As on 31 Dec 2013 IN PAST 35 YEARS BSE SENSEX HAS GIVEN 16.65% RETURNS GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP POWER OF COMPOUNDING Albert Einstein once noted that the most powerful force in the universe was the principle of compounding. In investing, this manifests itself through something called compound interest. Put in its simplest terms, the phrase compound interest means that you begin to earn interest income on your interest income, resulting in your money growing at an ever-accelerating rate. DO YOU KNOW? At the Rate of 15% Compounding what will be the value of Give maximum TIME to your investment to get most of POWER OF COMPOUNDING R 1/- R 2/- After 5 years R 4/- After 10 years R 8/- After 15 years R 64/- After 30 years GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP SYSTEMATIC INVESTMENT PLAN (SIP) Systematic Investment Plan (SIP) is a tool that allows you to invest in mutual funds through small, periodic installments. SIPs help you set aside a fxed amount every month for investments thus contributing towards your goals. For Investment purpose, we often wait to collect a large amount of money and investment it all at once. Through SIP you can start with smaller amount on a monthly basis and create wealth over the long term. GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP There are 27 equity funds, which have completed 15 years, the average SIP return of 27 diversified equity funds is 19.34% over last 15 years. So someone who had started with SIP of R10,000 in January 1999, has accumulated R90.14 lacs as on 31st December 2013 (on an investment of R18 lacs over the 15 year period). SIP PERFORMANCE EQUITY NOT RISKY IN LONG TERM PERFORMANCE OF SIP IN DIVERSIFIED EQUITY MF SCHEMES CAGR (%) Category 19.34% 13.72% Avg of MF Schemes Sensex 15 yrs Performance Returns on R10,000 invested per month Current Value (R) 90,13,807 55,17,022 (Total number of schemes covered : 27, Returns as on 31 Dec. 2013 SIP Amount of R10,000 per month. Total investment R18 Lacs) INVESTED R 1 L SIP R10,000/- PER MONTH R .1 L CURRENT VALUE *Returns as on 31 Dec. 2013. For Schemes with dividend option, dividend reinvestment has been considered on the date of dividend. Investment assumed to be done on 10th of every month. Source: Internal GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP There are 4 balance funds, which have completed 15 years, the average SIP return 13.85% over last 15 years. So someone who had started with SIP of R10,000 in January 1999, has accumulated R55.79 lacs as on 31st December 2013 (on an investment of R18 lacs over the 15 year period). SIP PERFORMANCE PERFORMANCE OF SIP IN BALANCE FUND MF SCHEMES CAGR (%) Category 13.85% 13.72% Avg of BALANCE Schemes Sensex 15 yrs Performance Returns on R10,000 invested per month Current Value (R) 55,79,293 55,17,022 (Total number of Balance fund scheme covered 4, Returns as on 31st December 2013. SIP Amount of R10,000 per month. Total investment R18 Lacs) INVESTED R 1 L SIP R10,000/- PER MONTH R . L CURRENT VALUE *Returns as on 31st December 2013. For Schemes with dividend option, dividend reinvestment has been considered on the date of dividend. Investment assumed to be done on 10th of every month. Source: Internal GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP NJ GAP is a unique goal based investment programme through a Systematic Investment Plan (SIP). Investors in this programme have the flexibility of choosing a monthly investment amount as well as the investment duration of their choice. NJ GAP would enable the investors to plan for their goals without needing to review, re-invest or for that matter time the markets. With NJ GAP you can plan to fulfill all your desires in life. REAP THE BENEFIT OF COMPOUNDING THROUGH SIP WHY NJ GAP WITH NJ GAP YOU CAN PLAN TO FULFIL YOUR GOALS IN LIFE GOAL ACHIEVEMENT PROGRAMME THROUGH MF SIPS GAP GAP GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP NJ GAP FEATURES Monthly Investment Option 2000 5000 10000 15000 20000 NJ GAP OFFERS INVESTORS WITH GREAT ADVANTAGES INVESTMENTS IN THE RIGHT ASSET CLASS With NJ GAP, you would invest in Equities, an asset class with potential to deliver very attractive returns in the long run TAX FREE RETURNS Long term capital gains in Mutual Funds for investments above one year are nil. So, all returns made through NJ GAP are TAX FREE (1 year & above investment only). INVESTMENTS ARE HIGHLY LIQUID There is no lock-in* period of any kind and investments can be very easily redeemed at any time wish. CONVENIENCE You only have to fll the NJ GAP application form and the Auto Debit (ECS) form and submit it with one cheque. GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP GOAL ACHIEVEMENT PROGRAMME THROUGHMF SIPS GAP GAP SIP READY RECKONER SIP FOR LONG TERM CAN GIVE YOU THE MAXIMUM RETURN The above SIP Ready Reckoner is for illustration purpose only. The SIP amount, tenure of SIP, expected rate of return are assumed fgures for the purpose of explaining the concept of advantages of SIP investments. The actual result may vary from depicted results depending on scheme selected. It should not be construed to be indicative of scheme performance in any manner.