Investment for a SHORT TERM GOAL – Resources all set

POSTED BY sunil ON February 27, 2013 12:41 pm COMMENTS (25)

Dear All,

Owing to my Earlier post “Investment for a SHORT TERM GOAL – Resources all set”.

And upon receiving few feedback from learned members like Ashal and Ramesh, i have reveiwed the investment methods and below is the break-up.

Kindly let me if this should be fine. For all Equity and Debt Investments i have considered a modest return of 9%, with this return i will be able to achive my goal. Anything higher than this would be a bonus though.

1. Planning to invest 8000 per month as below – Tenure left to grow 5 Years

   a) For a Tenure of 2 years i shall be investing in Tax saving Mutual Funds as well as Debt Mutual Fund in the ratio below.
      40% Debt and 60% Equity.
      Such a type is choosen because, this investment will take care of my Tax Planning as well during initial 2 years and this will grow for next 3 years (removing the Lock in Period for the       entire amount by the end of 5th Year).

      4800 per month in Tax Saving Equity MF expecting an appreciation at 9% gives a final value of 164012. (Assuming investing for 2 years and leaving for next 3 years)
      3200 per month in Debt MF expecting an appreciation at 9% gives a final value of 109342. (Assuming investing for 2 years and leaving for next 3 years) – Though this will be continued (with a       different investment amount) along just for simplicity sake i have kept it seperate.

   b) For a Tenure of 3 years i shall be investing in Open Ended Equity MF and Debt MF in below ratio (20-80 respectively)

      1600 per month in Equity MF expecting an appreciation at 9% gives a final value of 62940
      6400 per month in Debt MF expecting an appreciation at 9% gives a final value of 251758

2. I shall be receiving an amount of 110000 in Mid 2014 which i will invest as below – Tenure to Grow 4 years

   82500 into Pure Debt expecting an appreciation at 9% gives a final value of 116455
   27500 into Equity MF expecting an appreciation at 9% gives a final value of 38818

3. I shall be receiving an amount of 15000 in Mid 2014 (from other source than that of point 2) which i will invest as below – Tenure to Grow 4 years

   15000 into Equity MF expecting an appreciation at 9% gives a final value of ’21174′

4. I shall be receiving an amount of 180000 in 2015 (February)  which i will invest as below – Tenure to Grow 3 years

   144000 into Pure Debt expecting an appreciation at 9% gives a final value of 186484
   36000 into Equity expecting an appreciation at 9% gives a final value of 46621


Total Amount gathered from all the investments : 997604.

This is 20,000 more when i have considered MIP’s and Debt.


25 replies on this article “Investment for a SHORT TERM GOAL – Resources all set”

  1. Dear Sunil, for past please term yourtself lucky nothing else. Past performance is not a guarantee of future performance. Remember the age old quote in the market. 🙂 🙂



  2. sunil says:

    Thanks Ramesh for the view….. yes, i shall do that. Since during last couple of years i was able to predict for few shares as Lupin, Wokard, Biocon… hope i turn out positive this time also…

    Thanks Ashal for the Qoute.

    I shall start investing from March.

    Sunil Ramidi.

  3. Dear Sunil< please do not insult yourself by terming ytour own question stupid. If indeed a question 'll be stupid, we 'll not answer that. As simple as that. 🙂 🙂

    With all due respect to KBC & Sr. Bachchan –




  4. sunil says:

    Dear Ashal, Yes…. i have thinked over on it, and you are right. If i like the stocks personally i can anyways add them in my D-MAT.
    Never would i think that way Ashal, i feel free to ask what ever stupid thing comes into my mind, and i should appreciate your patience to review and answer back.

    I will be going with Quantum Tax , QLTF in Pure Equity and Templeton India Income Opportunities Fund for Debt.

    Thanks to Ashal and Ramesh once again for accepting all my queries and answering with patience.


    1. Ramesh says:

      Do Paper Trading and Investing for at least 2 years and then see, if you are smarter / better than your selected Funds. If not, then continue learning more.

      Overall, your portfolio returns are dependent on your Asset Allocation and the returns of the Assets – some say by 70%, others say by 90%.
      While market timing and active management contribute only 10% of the overall returns.

      Meaning, 70-90% of your returns are decided by your decisions of equity/debt/gold/alternative/international investments (over a long period of time) and not by which fund or which stock, etc.

      By opting for Quantum Tax Saving and QLTEF, you are just having mainly a single fund (with different tax repercussions), which is simple and good. Rather than 80 this, 20 that, and then being confused later on. Etc.

      1. sunil says:

        Dear Ramesh and Ashal,

        I have got this doubt while confirming on the Funds,

        I cornered on Quantum Tax saver and QLTF (open ended) for investing, however both the funds contain same portfolio…… only as Ramesh pointed with different Tax repercussions.

        I could not somehow understand how wil this be useful…. I am just duping my portfolio (i agree that i save on tax).

        Instead investing in Frnaklin Tax saver and QLTF would be a better solution (still only two funds but from different AMC’s and different posrtfolio’s).

        What you say Ramesh and Ashal??? Am i missing something?

        1. Ramesh says:

          Better in what respect?

          Tell me how are you going to manage between Franklin Tax Saver and QLTF. It is a given, putting whatever you require to fulfil the 80C benefit, you will put in Franklin Taxsaver. The rest in QLTEF.

          Will you put more in Franklin Taxsaver if it is down? OR
          Would you put more in Franklin Taxsaver if it is up?

          How would you change? Can you change?

          Main Principle to follow: Are the two funds of opposing styles which work differently in different market conditions or not? If they are not, you are just diversifying only in name and not for decreasing Risk. Same style funds have similar Risk/Return profiles.

          In your case, having a single portfolio across your equity portfolio is good enough, in case you opt for QLTEF/QTS. You will have no confusion over where to put money, etc. Putting in equity is much much more beneficial than which fund.

          1. sunil says:

            Got the doubt cleared Ramesh.
            Just thought tooo much on the portfolio’s front :).

            Thanks for clarification.

  5. Dear Sunil, instead of doing some simple things (investing what else), don’t you feel you are putting too much strain on yourself to be a perfect investor. Nothing wrong in your approach accept the fact that common sense is missing from your way of thinking & investing.

    If you really want to have a flair of FMCG or Pharma, who is stopping you to take a direct jump there in Eq. or respective sectoral funds.

    I’m sorry in advance, if you feel I’m critisizing you too much. I really want to keep your life & finance simple yet effective.



  6. sunil says:

    Dear Ramesh, the logic behind is to have a good returns from Franklin using the funds and more over to diversify further my portfolio – To be staright to point i like few stocks in Franklin which have very good future growth.

  7. sunil says:

    Thanks Ashal,
    The reason behind having Franklin Tax saver is to have the added advantage of tapping FMCG and Healthcare sectors apart from having few quality stocks which differ from Quantum.

    I agree the stocks should not be seen as such for selecting Fund, but still theose are few stocks with very good fundamentals.

    Correct me if this scenario will not yeild any special favour for me.

    However, i shall be diverting funds between Quantum adn Franklin (Tax Savers) in a ratio of 80-20.

    What do you say Ashal?

    1. Ramesh says:

      What does 80-20 accomplish? What is the logic behind it?

  8. Dear Sunil, instead of opting 2 Tax Savers, invest only in QTS what ever allocation you want to have for Tax saver funds. Regarding Pure Eq. Funds. Please opt only QLTEF & Fr’lin India BCF.



  9. sunil says:

    OMG, i din’t know this Ramesh.
    Thanks for enlightning.

  10. sunil says:

    Ramesh and Ashal,

    Are the Tax saver Funds good enough as per your analysis and study???

    I am expecting only 9% returns from them.

  11. sunil says:

    Dear Ramesh,
    The Expense Ratio seems to be the same between the two…
    Where does the Dirct have an edge over the Indirect?

    1. Ramesh says:

      Because VRO is dumb and will take much more time to indicate the difference.

      Check this.

      Roughly a difference of 0.4-0.5% per annual basis.

  12. sunil says:

    @ Ramesh :

    Is this the one suggested by you for consideration?

    1. Ramesh says:

      But my preference will be the Direct Option.

  13. sunil says:

    Thanks Ramesh for suggesting, I shall look into that.
    @ Ashal, Yeah it’s a good idea… let me approach icici people for opening of my PPF Account.

  14. Dear Sunil, PF is mandatory but regarding PPF, I do know the liquidity does not suits your time line but start now with a 500 Rs. yly investment. the reason is we are at the end of FY so your basic 15Y term ‘ll complete by the end of FY 2027-2028. So invest only 500 Rs. in current FY & in next 2-3 years.



  15. sunil says:

    PF Yes, comes around 11,000 a year.
    PPF – NO as of now.
    I might open it a couple of years down the line – The only reason being first i need to look out for my sort term goals (Which PF will not suffice) and after 2 years i shall divert the funds to PPF – Goal for retirement along with PF.

    Hmmm, i shall need to visit again for Franklin and Birla.

    Thanks for the promt reply.

    Rest looks OK for you?????

    1. Ramesh says:

      Check Templeton India Income Opportunities Fund.
      Not Corporate Bond one, because of longer exit periods.

  16. Dear Sunil, believe it or not selecting a debt fund is far more tough than an Eq. fund. 🙂

    You may opt from Franklin or Birla. By the way, what about your other debt instruments like PF or PPF?



  17. sunil says:

    The Mutual Funds selected for Tax Savings are “QUANTUM TAX SAVINGS – GROWTH” and “Franklin India Taxshield-G”. These two shall provide a well diversified portfolio (only 7% of postfolio intersecting between the two) with a good investment style.

    For Pure Equity Open Ended MF – Quantum Long term Equity is shortlisted.

    However, i am not able to come to a conclusion on the Pure Debt Fund to be included any suggestions????

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.