I would like to bring the below mentioned updates to your notice. I emphasize to write once a month to update on important info, or most of the time it would be about topics related to investing do’s and don’ts, importance of asset allocation etc.   Often good advice is repetitive and boring. However the rewards are worth in implementation.

First, I would like to bring good news to your notice that recently SEBI (the regulator) has reduced the cost of investing in mutual funds, which will have positive impact on your returns. This is the second cut since last couple of months. It will have some impact on our income. But in the long run what is good for you is definitely good for us.

In another decision SEBI has banned upfront commissions to distributors. Many distributors especially banks were dependent on large upfront commissions by selling NFO’s without any genuine effort to understand requirement of the investors. Now they may change their strategy and push PMS and insurance products. However these products are expensive and not appropriate in many cases.  So be careful in your dealings with banks.

As mentioned in my Jan’18 mail, the markets may remain highly volatile and not to carried away and invest aggressively ignoring asset allocation. And emphasized market movements should not dictate your investments.

Both equity and debt markets are under pressure this year due to various reasons. Though I can outline the number of reasons, what is important to note is it is very nature of the markets.Markets never move in linear manner. There will be phases when markets fall and move sideways for a very long time, which tests your patience.

However one need to be discipline and stay put, continue investing following proper asset allocation to generate long term investment returns.

The brains of humans contain a mechanism that is designed to give priority to bad news.”- Daniel Kahneman

When markets are in correcting and surrounded by negative news flow, it is prudent to avoid following financial headlines, particularly business channels which adds fuel to fire by their narratives. Though i send portfolio statements on monthly basis, it is prudent not to check it frequently.

“If owning stocks is a long-term project for you,” “following their changes constantly is a very, very bad idea. It’s the worst possible thing you can do, because people are so sensitive to short-term losses. If you count your money every day, you’ll be miserable. – Daniel Kahneman