Indian Share Market
All Time High :
Some Facts & Figures!!!
By
Mr. B. Padmanaban, Financial Planner,
Fortuneplanners.com,
Chennai
The most common dialogue
in the investing community today is Indian Share Market all time high, so it is
not a good time to Invest!
Market all time high is
a relative term. If you look at standalone yes, it is all time high. But, that
is not the way to look at it, if you really want to make money out of the
market.
BSE Sensex closed last
Friday (April 7, 2017) as 29706. Same Sensex closed at 29681 on 29th January
2015.
 |
| Mr.B. Padmanaban, Financial Planner Chennai. |
In other words, what
rate available today were 24 months before price. Is it a high or bargain? How you look at it, makes all the difference.
Similarly, Sensex first
touched all time high on 8th January 20873, from that we are nearly 111 months
now and today it is trading at 29706. In terms of absolute return to be
precise, it is 42.32%. Annualized return or CAGR return is mere 3.82%.
Enlighten me, is there
any commodity in India for the last 9 years have grown less than 4%, I keep
searching and could not find anything!!!
Investor is planning to
invest and stay invested for 3 plus years. To me it is one of the biggest
bargains, even if somebody reads all time high at the surface level.
In Chennai, property is
not coming down, but sales are also not happening. One year before sales were
happening and no one expressed that whatever they are buying at that moment is
all time high.
Our salary is all time
high and all the basic commodities are all time high, but this will never come
to our mind. But, we as an investor always have a double standard when it comes
to investing.
We are basically
emotional to certain investments so we have blind faith on few investments and
irrespective of the good returns one can get it in mutual fund, investor always
feel that this is not permanent!!! What happened in 2008, if that happens, I
will lose all the money?
Before, we comment on
2008 or comparing 2008 one should understand how the market moved linearly
between 2003 and 2008. We are not in the situation at all, so comparing 2008 is
more of excuse than reality, I would say.
One should really worry
when the market moved from 3000 to 21000 levels in 5 years, but investors
are in euphoria status at that time. Whereas from 21000 to 30000 after 9 years is nothing, but many feel that market
is high and I will wait for the market to correct.
Business is forever, no
business started with expiry date, similarly mutual fund investments forever
and we can take as and when we need money not booking profit and protecting those
gain. That is the reason, most of the mutual funds are open ended.
I reiterate the same
example, if the market compounded 16.2% per annum and if someone invested 1
lakh rupee, and the investor is keep taking Rs.16,200 every year and after 20
years there with drawl amount is Rs.3,24,000 and the principal amount is Rs. 1
lakh so total value is Rs.4,24,000.
Moreover this Rs.16,200 will find a way for
some spending. If they have not touched, then the value at the end of 20th year
is whopping Rs. 20 Lakhs at the same 16.2%.
I love this quote read
somewhere, Amateur book profits
and professional cut losses.
Please do not listen or
say to anyone that the market is high, henceforth market will be only high.
It’s open secret! Whether we took part in the journey to our capacity is the
question to be asked.
I hope you are all smart
people to understand this to take part the exciting investment journey for the
next one decade. I have committed to help you in this journey.
Fortune planners
Old no 5, New No 9, Kuppusamy Street,
G1, Lotus Apartments,T. Nagar, Chennai – 600017 | |
| +91- 9884349173 , +91 – 24817374 | |
| Email: | padmanaban@fortuneplanners.com padhu73@gmail.com http://www.fortuneplanners.com http://fortuneplanners.blogspot.in/ |
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