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kumar Time: 07-04-2025 18:33 Color:

THE ECONOMIC TIMES In chaos,

a compass
P2

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NG 3.7 PubDate: 07-07-2025 Zone: ETWealthMumbai Edition: 1 Page: METWDP47 User: suresh.kumar Time: 07-04-2025 18:40 Color:

THE ECONOMIC TIMES Policy

tailwinds to
boost NBFC
stocks
P14
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NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDPBP User: suresh.kumar Time: 07-04-2025 17:09 Color:

QA
your queries

&
The Economic Times Wealth July 07-13, 2025

I’m a 26-year-old government

I’m a 37-year-old homemaker and my portfolio
employee without any dependants. I
comprises mutual funds worth `10 lakh,
can save `30,000 per month. Where
government bonds worth `65 lakh maturing in
should I invest to keep my money safe?
phases till 2030, and `8 lakh invested via
Paytm Money. My mother has invested in my
name in a `10 lakh LIC single premium plan, an Since you are young, with nearly 34 years
`8 lakh Jeevan Shanti policy, and a `20 lakh
of working life left till you retire at 60, I
regular LIC policy. I also have two SIPs of
`2,000 each. In June, I’ll receive `5 lakh from a Our panel of experts will suggest you take risk and invest in equity
mutual funds in order to create wealth.
maturing government bond. Please suggest
suitable investment options for generating a
answer questions related to You can either consider investing in
steady monthly income with this amount. I any aspect of personal well-diversified equity funds or create a
also plan to start working soon with a salary of portfolio mix of large-cap, mid-cap and
`35,000-40,000 per month. How can I optimise finance. If you have a query, small-cap funds of different styles. If you
my current investments and future income?
mail it to us right away. are unable to pick the right funds, you can
simply invest in the Nifty 500 Index Fund.
To give you an estimate, assuming a 12%
As a first step, check if you need so
many traditional insurance policies. If
QUESTION OF THE WEEK CAGR return in equity for 34 years,
`30,000 invested per month via the SIP
you have paid the premium for a mini- route shall help you build a pre-tax cor-
mum period and can stop (in case of pus of `17.25 crore.
annual premiums) or surrender these As and when your salary increases, in-
plans, please do so now. For life insur- My father is retiring in September this
creasing your SIPs by 5% annually could
ance, you should have a pure protec- year with a retirement corpus of `50 help you accumulate around `26.36 crore
tion term policy. Invest in mutual funds lakh. We are looking to invest this (pre-tax). Equity as an asset class is vola-
through simple equity index funds,
amount to generate a steady monthly tile, but if you remain disciplined and in-
such as the Nifty 50 and Nifty Midcap vest in it for the long term, risk can be
150. Use RBI Floating Rate bonds income for his routine expenses. While
minimised. Equity is the only
and bank deposits for income our target is an annual return of
asset class that will help
needs. The other bonds are 15-20%, we are risk-averse and prefer you beat inflation com-
fine for a safe income flow. low to moderate risk instruments. fortably.
Could you suggest suitable options?
Vidya Bala Rushabh Desai
Co-Founder, PrimeInvestor.in
Founder, Rupee With Rushabh
Given that your father is approaching retirement, Investment Services
and the fact that he is risk-averse, it is advisable to
target a balanced strategy that protects capital,
generates steady income, and takes controlled
I am 36 years old and live with my wife
(36) and mother. We do not own any risks to optimally increase returns. Assuming there
property. Our current net worth is `1 is no other income source (pension, rental, etc.), Is it possible to file an income tax return
crore and the portfolio comprises the EPF, here’s how you can address the blended (ITR) for a deceased family member
PPF and other investments. Our combined requirement of safety, regular income, liquidity (mother or father) and claim a refund for
gross CTC is `26 lakh per year and annual and growth. tax deducted at source (TDS) on income
expenses amount to `8.5 lakh. What l Invest `25 lakh in the Senior Citizens’ Savings received in the same financial year? If
should our net worth be by the age of 41 Scheme (SCSS). At 8.2% per anum, it will generate yes, are there any specific procedures to
in order to achieve financial freedom? `2.05 lakh in annual interest income (paid follow or prior intimation to be submit-
ted to the Income Tax Department?
quarterly).
Financial freedom means having enough in- l Put `10 lakh in the RBI Floating Rate bonds at
come and savings to comfortably cover all 8.05%. This will generate about `81,000 annually Yes, it is possible to file an income tax re-
living expenses without relying on the next (paid in parts half yearly). turn for a deceased family member and
pay cheque. It’s commendable that you’ve l Invest `5 lakh in bank fixed deposits at around claim a refund for TDS on income received
been mindful of your household spending. 7.25%. This will generate `36,000-37,000 in the same financial year. Under Section
The corpus required to achieve financial free- annually. This can also act as a source of immediate 159 of the Income Tax Act, 1961, the legal
dom depends on several variables, and any liquidity and emergency fund when a large amount heir is responsible for filing the return on
change, especially in expected returns, can is needed unexpectedly. Alternatives might be behalf of the deceased. The legal heir
significantly impact the target amount. Con- higher return options like corporate fixed deposits must register as a representative asses-
sidering the future uncertainty around taxes, (8-10%), but these carry credit risk and, hence, are see on the income tax e-filing portal.
inflation and interest rates, it’s prudent to as- not suited to your father’s risk-averse profile. This involves logging into their own e-
sume both inflation and returns to be 6%. l Invest `3-5 lakh in conservative hybrid (or debt filing account, navigating to ‘My account’,
Based on a life expectancy of 90 years, you funds). This can be used to start a systematic then ‘Register as representative’, go to
would need to build a corpus of `5.5 crore by withdrawal plan (SWP) if additional regular income ‘New request’, select ‘Deceased (legal
the age of 41 to sustain yourself financially is needed in a tax-efficient manner. heir)’, and provide the necessary informa-
for the following 49 years. The exact invest- l Put the remaining `5-7 lakh in flexi-cap/ tion and documents. Once the Income Tax
ment amount required to reach this goal will aggressive hybrid funds. This is not for immediate Department approves the registration,
depend on your choice of financial products. consumption, but to beat inflation over time. Be the ITR can be filed. Any eligible TDS re-
Your current holdings, EPF and PPF, are good, willing to wait for 5-7 years to allow this to deliver fund will then be credited to the legal
low-risk instruments, but it’s advisable to al- decent returns and stagger the heir’s bank account, which
locate a portion of your portfolio to equity deployment over six months to must be registered on the
mutual funds as well. Also main- average out. Have your father’s e-filing portal.
tain a separate emergency fund portfolio reviewed by an
and secure a comprehensive investment adviser every 1-2
health insurance policy. years to ensure the strategy’s
relevance over time. Amit Maheshwari
Tax Partner, AKM Global

Prableen Bajpai Dev Ashish

Founder, FinFix Research and Founder, StableInvestor, and Please send your feedback to
Analytics Sebi-registered investment adviser etwealth@timesofindia.com
NG 3.7 PubDate: 07-07-2025 Zone: ETWealthMumbai Edition: 2 Page: METWDFP User: suresh.kumar Time: 07-04-2025 19:14 Color:

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THE ECONOMIC TIMES WHY PET

INSURANCE
ISN’T OPTIONAL
ANYMORE
P8

In chaos,
a compass
Financial advisers: Your anchor when
everything else was sinking. P2

CREATE CONSENSUS, CUT CONFLICTS P6

ACCREDITED INVESTORS: INDIA’S EMPTY ELITE CLUB P12
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP2 User: suresh.kumar Time: 07-04-2025 17:24 Color:

cover story
02 The Economic Times Wealth July 07-13, 2025

In chaos,
a compass
How trusted financial advisers helped investors ride
out the market mayhem—and come out stronger.

by Kayezad E. Adajania &

Yasmin Hussain ,

I
n September last year, a 56-year- What’s the most
old retiree from Mumbai avoidable mistake
investors have What did your Which asset has sur-
reached out to her financial
made this year? gut say in March prised you the most
planner, Santosh Joseph, CEO
2025? in this cycle—equity,
of Germinate Investor Services. gold or debt?
The former public sector bank employ- Not having a
ee wanted to invest in equities for the One belief about
financial adviser as We increased expo-
money that has Equity.
first time. She had parked her money a sounding board sure to gold, bonds
changed for you
in fixed deposits (FD) for most part of for irrational and equities, where
over the years…
her working life and now wanted to get decision-making. we found gaps in
a taste of equities. asset allocation,
When March 2025 lows came, she or where monies
The power of
was distraught. Her portfolio had lost were waiting on the
compounding What do clients sidelines for deploy-
15% in just three months. She regret- actually works. get most anxious ment in the markets.
ted her decision, thinking that ventur- Discipline in mar- about in a falling
ing into equities was akin to gambling kets is one of the market?
and that she ought to have stayed most underrated,
away. However, a call from Joseph yet powerful,
changed her mind—and her fortunes.
tools for success- Dilshad Billimoria
Fall in portfolio
ful investing.
Ten months later, she has not just re- values, uncertainty Managing Director & Chief Financial
covered her losses, but made a smart and lack of direction. Planner, Dilzer Consultants
profit as well.
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP3 User: suresh.kumar Time: 07-04-2025 17:29 Color:

cover story
The Economic Times Wealth July 07-13, 2025 03

Even if your SIPs How has your

are on, some

own invest- What’s the
What would be ment style smartest thing
the one piece of evolved over a client has
special situations advice you’d give
for the next 12
the years? done in the
past year?
may require deft If you had
months?
I have always
handling, especially `1 lakh to
invest today,
Continue with
followed
strategic
Took advice to
invest in gold
during market
where would
your monthly asset alloca- and silver.
you put it? 40% in equity; investments tion; never
mayhem. Here’s 35% debt; 15%
hybrid/multi-
in spite of
turbulence in
invested tac-
tically to take
Suresh Sadagopan
where a guiding
asset funds; the markets. advantage of
10% gold and the markets.
silver. Founder, Ladder7
hand is reassuring. Financial Advisories

Stories like these aren’t rare. As market nelled their savings to government
volatility has tested investor nerves, finan- What kind of securities and gold funds.
cial planners have quietly played the role of client conversa- “The year 2023 was bad for busi-
Do you believe
steady navigators—booking profits, tweak- more investors tions do you ness,” says Chadha, referring to the
ing asset mixes and, most importantly, stop- need a Plan B enjoy most? contrarian call, when everyone want-
ping panic in its tracks. mindset? ed a piece of equities as the S&P BSE
Between August 2024 and June 2025, the Sensex went up by 20% that year.
Sensex swung nearly 14,500 points. Bond A contrarian call Goal-based Having witnessed an impressive in-
yields seesawed (but largely fell), and mid- you made and investing dis- flux of more than `41,000 crore, small-
were proven The problem is
cap and small-cap stocks corrected. For the cussions. Let’s cap funds posted more inflows than
right… most investors
try and solve
average investor, it was a nerve-wracking don’t even follow outflows that year.
the real money
ride. However, those with experienced fi- ‘Plan A’ properly. At the time, Chadha’s only recom-
problem of our
nancial planners by their side found ways to Investing in a PSU fund Brian Feroldi, a US- mendation in equity was large-cap
investors. I’m
not just survive, but thrive. in August 2020. My based wealth pro- funds and Nifty Next50 index passive
not interested
We spoke to several such advisers to un- four-year SIP return: fessional, once said, funds. A year later, his investors not
in market
56% (compounded). “The best invest-
derstand how smart strategy and steady discussions. just recovered losses, but made a smart
ment plan for you
counsel had made all the difference. profit as well. “Typically, a 60% alloca-
isn’t based on some
tion in equities is ideal. Going slow in
Smart allocation How do you formula. It’s the one
you’ll actually stick mid caps and equities in 2023 and much
emotionally
In 2023, when small-cap equity funds were with when markets of 2024 helped our clients’ allocation
distance your-
all the rage with investors, with net inflows self from client are crashing.” to equities come back to around 60%,”
worth `41,035 crore, Gurugram-based finan- panic? says Chadha.
cial adviser Ashish Chadha sent out a note to The ongoing SIPs aside, investors
his investors to go slow on equities. and advisers also look for opportune
Chadha, Director of Chadha Investment I just show them my Gajendra Kothari moments to step up their investments.
Consultant, had stopped recommending family’s portfolio. This is not market timing, but the
them small-cap funds back then. He had We either swim to- Managing Director & point where, after a persistent fall in
Chief Executive Officer,
even dissuaded them from fresh systematic gether or sink together. the markets, it seems reasonably safe
Etica Wealth
investment plans (SIP) and, instead, chan- to put in a small lump sum. On 4

Market falls and recoveries

Investors often panic when the market falls. However, they need to remember that it recovers as well.

Peak Trough Trough Fall from Sensex Sensex Total time for fall
Peak date Time for fall Time for recovery
value date value peak recovery date value & recovery

4 Jun 1986 659 28 Mar 1988 390 -41% 30 Sep 1988 663 1 year, 10 months 6 months 2 years, 4 months

9 Oct 1990 1,559 25 Jan 1991 956 -39% 26 Jul 1991 1,600 4 months 6 months 10 months

22 Apr 1992 4,467 26 Apr 1993 2,037 -54% 12 Aug 1994 4,508 12 months 1 year, 4 months 2 years, 4 months

12 Sep 1994 4,631 4 Dec 1996 2,745 -41% 14 Jul 1999 4,710 2 years, 3 months 2 years, 7 months 4 years, 10 months

21 Apr 1998 4,281 20 Oct 1998 2,764 -35% 5 Jul 1999 4,306 6 months 8 months 1 year, 2 months

11 Feb 2000 5,934 21 Sep 2001 2,600 -56% 2 Jan 2004 6,027 1 year, 7 months 2 years, 3 months 3 years, 10 months

8 Jan 2008 20,873 9 Mar 2009 8,160 -61% 4 Nov 2010 20,894 1 year, 2 months 1 year, 8 months 2 years, 10 months

14 Jan 2020 41,952 23 Mar 2020 25,981 -38% 9 Nov 2020 42,597 2 months 8 months 10 months

Average 1 year, 1 month 1 year, 3 months 2 years, 4 months

Maximum 2 years, 3 months 2 years, 7 months 4 years, 10 months

Minimum 2 months 6 months 8 months

Source: ACE MF, FundsIndia Research
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP4 User: suresh.kumar Time: 07-04-2025 17:31 Color:

cover story
04 The Economic Times Wealth July 07-13, 2025

Looking for What’s

If you could ban
moments to step How do you
calm down a
your risk appetite—
high, medium, or
one investor
behaviour, what
up investments is panicked client? cautious?
would it be?

not market tim- One money

habit you wish
Listen.
Medium
risk. If price
Discussing port-
folios over a third
ing, but periods more investors
followed…
A moment
this year that
is cheap, it
turns high.
whiskey at a party.

after a fall, when Not watching social

tested you as an
adviser…
Ashish Chadha
it’s safe to put in a media and TV as
it messes up your Operation Sindoor and Director,

small lump sum. asset allocation. the Israel-Iran conflict. Chadha Investment Consultant

March, when the Sensex hit a low of shape. “We sold a small portion of her US
72,989 points, smart advisers saw little shares to close some of her loans. We retired
downside from thereon and nudged One financial quite a few of her loans so that a larger por-
investors to step up their equity in- mistake you tion of her regular salary here could be di-
vestments. made and what When do you rected towards savings,” says Sadagopan.
it taught you… decide to go
Gajendra Kothari, Managing In another instance, according to
from SIP to
Director & Chief Executive Officer, What’s your gut lump-sum Sadagopan, a client who retired in November
Etica Wealth, a Mumbai-based dis- feeling about investing? 2024 got a large sum as retiral benefit, includ-
tribution firm, advised his clients to mid-caps and Not starting ing the provident fund and gratuity. Equity
small-caps to invest
resume lump-sum investments in eq- During markets had already started to fall by then;
today? early.
uities that day and continued reinforc- a sharp the Sensex had fallen by 8% between the
ing his message throughout the week. correction, peak of September and November-end. While
“We invest a lot via SIPs. So most of my These are say, 10% or regular income needs were to be met from
extremely How do you
clients have been investing regularly, define financial more, within debt investments, Sadagopan had to ensure
important and a short
but many don’t do it through SIPs. We freedom—for longevity of the corpus by investing a chunk
relevant. Just period of
dug into our database and found those beware of the yourself? in equities. A large lump sum (part of retiral
who don’t, and reached out to convince time. benefits) is usually invested through STPs.
position sizing.
them that it was a good time to get back The question was by what time.
Being able to afford what
in,” says Kothari. Here, he says, his firm initiated STPs of
you want to do with your
He adds that his firm deployed near- 20-24 weeks, instead of the usual 10-12 weeks.
One client time and yourself. Every-
ly `10 crore that week between fresh thing else transcends this. “It worked out quite well. The STPs were
inflows, additional lump-sum top-ups behaviour that started when equity markets were at rela-
always makes
and switches from liquid funds. Of tively lower points. We also put some money
you nervous...
this, `2.26 crore came through fresh Santosh Joseph in gold and silver assets.”
purchases and `5 crore via 234 addi-
tional purchase transactions. Over-confidence and CEO, Germinate Tactical vs strategic
Elsewhere, Dilshad Billimoria, over-expectation. Investor Services If you have invested wisely and are continu-
Managing Director and Chief ing with your SIPs, what does a financial
Financial Planner at Dilzer adviser bring to the table?
Consultants, a Sebi-registered invest- Most advisers we spoke to said that they
ment advisory firm, increased the dug deep into the clients’ portfolios to iden- of Ladder7 Financial Advisories, tells us didn’t need to do anything with a majority
time period of her clients’ systematic tify non-performers and took advantage of about a client who was a senior executive in of their clients. Sadagopan adds that none
transfer plans (STP), in 2024, as equity the rising markets to consolidate. her company, but was constantly stretched of his clients asked him to stop the SIPs. He
markets were going up. The STP facil- financially on account of multiple loans says that volatile periods like the one preva-
ity helps transfer money from liquid or Calming investors and high cost of her children’s education. lent since September 2024 don’t really call
short-term debt funds to equity mutu- Even if your SIPs are on, there are special In February, at the height of the US trade for significant action because “we generally
al funds. It helps investors with a lump situations that may require deft handling. tariff uncertainty, Sadagopan realised that build a high margin of safety when we make
sum in hand to deploy money steadily If these come up amidst market mayhem she had a lot of employee stock options from financial plans”. Besides, it’s a fact that what
into equities. “If somebody had an STP and global uncertainty, it could cloud your her US-based company that were lying in a goes down, eventually comes up (see table).
program of 12 weeks, we increased it judgement. Here’s where a guiding hand is US-based depository account. Sadagopan “Knowing that their basics are covered
to 20,” she says. Billimoria’s firm also reassuring. Suresh Sadagopan, Founder said that the company itself wasn’t in a great helps clients stay invested with more con-
fidence,” says Rohit Shah, Founder & CEO,
GYR Financial Planners. In the past 10
months, Shah says none of his clients have
stopped their SIPs, even as volatility has
What does ‘wealth’
mean to you beyond surged. Sometimes, however, volatility pro-
What kind of client
numbers? vides tactical opportunities. Shah recollects
behaviour signals
long-term success? a client for whom he had already planned,
Do you see your role sometime last year, to deploy money in
‘Love’ that a family
more as a strategist mid-cap funds once valuations became at-
holds for genera-
Faith in the or a psychologist? What would be the tractive, over six months. But when mid- and
tions to come.
future, pa- one piece of advice
small-cap indices dropped sharply in late
tience with you would give for
2024, Shah reached out with a suggestion:
results, and What’s the most the next 12 months?
“Let’s prepone the next few instalments.”
disciplined A behaviour firefighter, step- avoidable mistake
investing. Money was already parked in liquid funds
ping in to manage emotions investors have made
and guide decisions. If you’re in the and an STP was on. “Based on our analysis,
this year?
accumulation that segment was offering good value,” he re-
phase, what calls. The client agreed, and they redeployed
Rohit Shah happens in the the capital at a lower NAV (net asset value).
Predicting a market correction that’ll last next six months
Founder & CEO, Getting You throughout 2025 due to Operation Sindoor won’t matter. kayezad.adajania@timesofindia.com &
Rich Financial Planners and US President Donald Trump’s tariffs. yasmin.hussain@timesofindia.com
NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP5 User: suresh.kumar Time: 07-04-2025 19:01 Color:

guest column
The Economic Times Wealth July 07-13, 2025 05

Gurus on the rise again

During the bull market, everyone becomes an expert, but Warren Buffett’s
farm analogy offers better lessons to investors, says Dhirendra Kumar.

A
peculiar phenomenon during bull
markets should concern every seri-
ous investor. As stock prices climb
and portfolios swell, a curious
transformation takes place across
social media and dinner tables. Suddenly, eve-

GETTYIMAGES
ryone discovers the secret to wealth creation.
The investor, who had bought a few stocks last
year, starts dispensing investment wisdom.
The neighbour, who stumbled upon a stock
that zoomed up, is holding court about market
DHIRENDR A KUMAR dynamics. The most troubling of all, people
CEO, VALUE RESE ARCH with barely two years of market experience
are confidently educating others about the
intricacies of investing.
money This observation brings to mind Warren

mysteries Buffett’s brilliant analogy between stocks and

farms, outlined in his 2013 letter to Berkshire ations for your holdings, whereas I am yet to substantial upside from lease renewals and
Hathaway shareholders. Buffett’s approach see a quotation for either my farm or the New improved management. As he noted, “NYU
offers a stark contrast to the noise dominating York real estate.” This constant price feed- wasn’t going anywhere.”
the bull market discourse, and his 1986 farm back, rather than being helpful, often becomes This is precisely the kind of thinking that
purchase provides timeless lessons for navi- an obstacle to sound investment thinking. gets lost during both market extremes. Bull
gating today’s expert-saturated environment. market gurus promote complexity and market
Bull & bear markets timing, while bear market pessimists pro-
The farm analogy Of stocks and farms The newly minted investment educators of mote panic and permanent avoidance. Neither
extends to As he narrates in the letter, when Buffett social media are precisely the people Buffett approach focuses on what Buffett calls the
understanding market bought the 400-acre Nebraska farm for warns against—those who focus on the score- fundamental question: “The future productiv-
cycles. Just as farms $2,80,000, he knew nothing about farming. board rather than the playing field. They ity of the asset you are considering.”
experience seasons of However, he understood something far more teach followers to watch stock prices obses-
important: the fundamentals of productive as- sively, react to daily market movements, and Buffett vs educators
plenty and scarcity,
sets. He calculated that the farm would yield confuse activity with progress. They have The genuine wisdom in Buffett’s approach
markets move through
about 10% annually based on corn and soy- never experienced what Buffett calls the “oc- lies not in his stock-picking prowess, but
periods of optimism bean production, with likely improvements in casional bad crop” or learnt to distinguish in his businessman mentality. He advises,
and pessimism. both productivity and crop prices over time. between temporary setbacks and permanent “Investment is most intelligent when it is most
Buffett’s farm has Crucially, he noted, “What the economy, inter- capital destruction. businesslike.” This means thinking about
tripled its earnings est rates, or the stock market might do in the The mathematics of bull market exper- stocks as pieces of businesses rather than
over the decades, years immediately following, was of no impor- tise is particularly insidious. When Buffett trading instruments, focusing on earning
tance to me in making that investment.” bought his farm, he understood that “there power rather than price movement, and main-
but this success came
Seven years later, Buffett made a similar would be some unusually good years as well, taining patience that comes from understand-
from focusing on
investment when he joined a small group and I would never be under any pressure to ing what you own.
productive capacity purchasing a retail property adjacent to New sell the property”. This long-term perspec- Most importantly, perhaps, Buffett advo-
rather than trying York University from the Resolution Trust tive is exactly what bull market education cates what he calls the “know nothing” inves-
to time agricultural Corporation. Once again, a real estate bubble typically lacks. New investors learn to chase tor approach for those who cannot dedicate
commodity cycles. had burst, creating opportunities for those performance rather than preserve capital, themselves to serious business analysis. This
focused on productive assets, rather than developing an appetite for complexity rather involves broad diversification through low-
market sentiment. than Buffett’s elegant simplicity. cost index funds, rather than attempting to
This approach stands in sharp contrast to The farm analogy extends to understand- pick individual winners. It’s the opposite of
the learnings being dispensed by today’s bull ing market cycles. Just as farms experience what most bull market educators promote, but
market gurus. While they focus on momen- seasons of plenty and scarcity, markets move is based on decades of evidence rather than
tum, technical analysis, and market timing, through periods of optimism and pessimism. recent lucky streaks.
Buffett concentrated on what the asset would Buffett’s farm has tripled its earnings over the The tragedy is that both extremes —experi-
produce. He wasn’t trying to predict price decades, but this success came from focusing enced bull market educators and vindicated
movements or outsmart other investors; he on productive capacity rather than trying to bear market pessimists —influence inves-
was simply buying productive capacity at a time agricultural commodity cycles. tor behaviour at the wrong moments. They
reasonable price. Bear markets reveal the flip side of this encourage excessive risk-taking near market
The problem with bull market expertise phenomenon. Those who have been predicting peaks, and panic-selling near market bot-
isn’t that people are making money; it’s won- doom for years suddenly find validation, even toms. Buffett’s farm teaches us something
derful when that happens. The issue lies in the though they are typically wrong 90% of the entirely different. Success comes from buy-
dangerous confusion between getting lucky time. These perpetual pessimists make the op- ing productive assets at reasonable prices,
and being skilled. When markets are rising posite error of bull market optimists. Instead understanding what you own, and having the
broadly, even poor decisions can yield positive of recognising the cyclical nature of markets, patience to let compounding work over long
returns. This creates, as Buffett describes, the they extrapolate the prevailing difficulties periods. It’s not glamorous advice and it won’t
danger of letting “the capricious and irration- indefinitely into the future. generate social media followers, but it works.
al behaviour of fellow owners to cause them to Buffett’s New York real estate investment The gurus are multiplying again, as they do
behave irrationally as well”. in 1993 illustrates this perfectly. While others in every bull market. However, it’s better to be
Consider Buffett’s insight about his farm: saw a commercial real estate bubble burst, more like farmers and less like traders.
“There is one major difference between my he saw an undervalued, productive asset
two small investments and an investment in near New York University. The analysis was Please send your feedback to
stocks. Stocks provide minute-to-minute valu- straightforward: 10% unleveraged yield with etwealth@timesofindia.com
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP6 User: suresh.kumar Time: 07-04-2025 17:33 Color:

financial planning
06 The Economic Times Wealth July 07-13, 2025

Create consensus, cut conflicts

Institutions have the benefit of management and investment committees to take big calls on financial
conflicts. For families, it helps to create a broad set of rules and principles, says Uma Shashikant.

C
onflicts about money are
common. We all have unique
money personalities. Our beliefs
on earning, spending, saving,
investing, sharing and giving are
quite distinct. Institutions have the benefit of
management and investment committees, and
a set of rules that apply to these decisions. Can
households that quibble about money benefit
UMA SHASHIK ANT from some principles and rules too?
CHAIRPER SON, The father believed that saving early was im-
CENTRE FOR INVES TMENT
portant and wanted to manage his son’s money.
EDUC ATION AND LE ARNING
The son did not agree to give such control. They
lived together with their spouses in one house-
hold and decided to discuss before making big
decisions, which only made things worse. The
differences became sharply visible and con-
sensus was impossible. Resentment ensued.
GETTY IMAGES

There is no The father felt that the son must buy a house,
substitute for open but the son refused to buy immovable assets
communication. so early in his life. The father disliked stocks,
while the son enjoyed day trading.
Talking about what
We have discussed stories where husband
matters to one, and wife find it tough to reach a consensus on investments that enable growth and income as grandmother. It is easier to set up an SIP and
negotiating for money matters. One likes to spend, the other needed; allowing investments to grow over the agree to save first for that goal, before allo-
one’s needs, and likes to save. One wants to focus on career and long term; and capping charity to levels eve- cating to any other expense. Currently, both
being open about income, the other wants work-life balance with ryone is comfortable with, are some examples women quarrel over too little being left at the
one’s beliefs helps lesser income. One saves and lets it lie, the oth- of broad rules. These principles are the touch- end of each month to save for the child. This
er wants to periodically use the savings. Such stones that will test and confirm the financial causes insecurity in the mind of the young
the other to be
arguments usually don’t end well. decisions that the household members make mother, who wants to secretly save without
more empathetic. I met an elderly woman and her daughter-in- from time to time. disclosing her increment and bonus.
Being vulnerable law, who live with the latter’s two young chil- Second, accept transparency as mandatory
about one’s fears dren. The daughter-in-law lost her husband, to building trust and smoothen the decision- Budgeting & technical decisions
and suspicions, the only son of the widowed elderly woman, a making process. Many households suffer when Fifth, allocate money to spending decisions
insecurities and few years ago. They were living together, with money is used as a source of power. Earning and agree to a limit. Exceptions make for the
the elderly woman managing the house and the members seek discretion with financial deci- most arguments in a household. Annual holi-
doubts is critical to
daughter-in-law going out to work. They disa- sions, or actively bend the agreed upon rules days or birthday celebrations should have
getting support greed on every aspect of managing money for according to their personal beliefs and whims. allocated budgets. Don’t work with the as-
from the other. the household and often quarrelled over it. The daughter-in-law would not disclose the sumption that such expenses will always run
Are there rules for these situations? Instead income to her mother-in-law. She would sim- out of hand. They are just poorly estimated
of having to discuss every situation, it helps to ply give the latter a monthly allowance. The and budgeted, or manipulated to exceed
invest time in creating a broad set of principles mother-in-law would begrudge every decision budgets. Many of us use money to serve our
so that everyday actions can be referred to because she suspected there was more money need for attention, love, approval and author-
these. There is no substitute for open commu- to spend. It would be better if both know that ity. Letting go of the budget is a tactic to cover
nication. Talking about what matters to one, there is more money set aside by the younger up for guilt, regret or shame. Identify and
negotiating for one’s needs, and being open woman for specific purposes. avoid these conflicts, and be prepared to be-
about one’s beliefs helps the other to be more come unpopular for sticking to the budget.
empathetic. Being vulnerable about one’s fears Spending & saving Sixth, if a financial decision is technical,
and suspicions, insecurities and doubts is criti- Third, budget and record common expenses, spend time to understand how it will affect
cal to getting support from the other. These but provide allowance for personal expenses. future financial goals and the household’s
are the toughest hurdles to cross in any close No one likes being questioned about every deci- ability to save, invest and use funds. In a
relationship. sion. However, a household needs transparent home loan, the choices of fixed versus float-
transactions that show everyone how money is ing, 15-year versus 30-year term, prepayment
Set the ground rules being spent. Having a common spending pool versus keeping the loan, are all technical de-
First, agree on the broad rules. If one member and setting aside funds as agreed upon, for cisions. Ask an expert how it will impact the
won’t work to contribute to the household in- individuals to spend as they wish, is both fair household. Don’t waste time trying to take
come, the other must accept it without holding and convenient to execute. A wife or husband a call on the markets and macros. Put down
a grudge. The household has set limits on its should be able to support their parents with a the details of what may happen under each
income willingly for the benefits brought to the portion of their income, after contributing to scenario. Hasty decisions end in regret.
family by its stay-at-home member. Every ma- the common pool. The mother-in-law needs a It is not always easy to arrive at a consen-
jor aspect of personal finance must follow this. monthly allowance, allocated as she wishes, sus, but household finances need it. Building
The financial personality of a household is an that won’t be questioned. it with fair and equitable principles is not
identity to be accepted by all members. It can- Fourth, how money is saved and invested tough. It just needs work and discipline.
not be modified as per personal preferences. must be determined by financial goals, not
Spending within means without borrowing; individual whims and preferences. A child’s Please send your feedback to
saving mandatorily before spending; choosing education is a vital goal for the mother and the etwealth@timesofindia.com
NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP7 User: suresh.kumar Time: 07-04-2025 17:52 Color:
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP8 User: suresh.kumar Time: 07-04-2025 18:59 Color:

insurance
08 The Economic Times Wealth July 07-13, 2025

ns u ra nce
Why pet i
optiona l an ym o re
isn’t

“We did an internal survey and it revealed haven’t filed a claim yet, but I sleep better pet parents had heard of pet insur-
by Yasmin Hussain that many pet owners don’t take their pets to knowing that if something happens, I won’t ance, and a mere 10% had purchased

O
the vet, hoping for self-recovery because they have to choose between treatment and af- it. “Most of the clients who visit our
ur pets are more than just can’t afford to get them treated,” says Arti fordability,” she says. clinic are unaware that such a product
animals—they’re family. They Mulik, Chief Technical Officer at Universal exists, even though it can be extremely
shower us with unconditional Sompo General Insurance (USGI). Source of stress useful and necessary,” says Dr B.K.
love and, in return, we do every- Pet insurance, though still a niche Her concern is widely shared. A USGI survey Chaudhary, a veterinarian at Dog and
thing we can to keep them happy product in India, can help bridge this gap, of 235 pet owners found that 90% considered Cat Clinic in Delhi.
and healthy. However, when illness strikes, offering both financial support and peace veterinary costs a major burden, while Mulik added that low agent inter-
the emotional toll on pet parents is immense; of mind during emergencies. Take the case 74% said it caused financial stress. Serious est is also to blame, explaining, “The
so is the financial one. of Gurugram-based Meenakshi Goel, and conditions like fractures, chronic illness, or ticket size and premium are small, so
Caring for a pet means making sure their Peanut and Butter, her two Indie (mixed cancer can easily rack up bills ranging from agents don’t find it attractive from a
health needs are addressed without delay. breed native to India) dogs. After a visit to `10,000 to over `1 lakh—expense that could commission standpoint.”
Yet, many pet parents hesitate to visit a vet- the vet for one of them left her with a `7,000 hit hard without a financial cushion.
erinarian, not because they don’t care, but bill, she decided to get insurance for both Despite signs of need for insurance, aware- Myths among pet parents
because they’re worried about the cost. from Bajaj Allianz General Insurance. “I ness remains low. Only 26% of the surveyed Even if people are aware, misconcep-
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP9 User: suresh.kumar Time: 07-04-2025 19:00 Color:

insurance
The Economic Times Wealth July 07-13, 2025 09

Pick & choose the

covers you want
Pet insurers offer standalone
covers, which can be customised as
per one’s need. The premium
depends on the type and number of
covers you opt for.

Sum insured (`)

HDFC Paws Future Generali Dog

Cover type Bajaj Allianz
& Claws Health Cover

Surgery 10,000-3 lakh 10,000-2 lakh

10,000-5 lakh
Hospitalisation 5,000-50,000
2 lakh 10% of sum insured
Fracture 1,000-5,000
up to 10,000
Meenakshi Goel, Gurugram Terminal illness 5,000-50,000 2 lakh 10,000-5 lakh
2 dogs: Peanut Breed: Insurer: Mortality 30,000 20,000 -
Reason fo
and Butter
(both 5 years)
Indies Bajaj Allianz
buying r OPD 30,000 25,000 1 lakh
insuranc Long-term care 5,000-50,000 - 10,000-50,000
e Up to sum insured
Premium: Third-party liability 10,000-1.5 crore 1 lakh-1 crore
`5,000 yearly for both specified in schedule
One visit to the Theft Up to 30,000 - 25,000
Covers include: veterinarian made Included in 10% of sum
OPD, surgery, hospitalisation, mortality, Funeral cost 5,000
her realise how costly Mortality cover insured
terminal illness, third-party liability.
procedures can be. Source: Policybazaar.com, hdfcergo.com, general.futuregenerali.com, bajajallianz.com.
This is not the complete list. Terms and conditions may apply.

tions often keep them from purchasing a policies cap coverage well before that age, Pet Insurance at Policybazaar. The pet insurance industry in India is
policy. Chennai-based A. Thirumaal, a doc- excluding dental treatments can be seen as Dr Chaudhary echoed the sentiment, still at a nascent stage and requires signifi-
tor who is a parent to two cats, explored pet a reasonable limitation. noting that none of his clients faced trouble cant improvements before it can cater to a
insurance, but ultimately decided against while filing claims, unless their pet had larger segment of customers. At present,
it. “There are too many exclusions, and most Hassle-free claim settlement a pre-existing condition. The problem, he most plans cover only cats and dogs. Other
plans are designed with dogs in mind. A cat- “There are no real downsides to buying pet said, usually lies in policyholders being pets like birds or rabbits are left out. A
specific product would be more relevant for insurance. Claim rejection issues are vir- ignorant about a specific visit or issue survey conducted by pet website, Dogster,
me,” he says. tually unheard of,” says Arpita Lal, Head of not being covered. This underscores the found that only a smaller niche of Indian
His main concern is that his cats often importance of reading the fine print and pet parents, around 32,000, owns exotic ani-
wander outdoors and have been seriously in- understanding exactly what illnesses and mals, such as turtles, lemurs and snakes.
jured in fights with stray dogs, an issue that A. Thirumaal, Chennai procedures are included. Pet insurance Unfortunately, they currently have no ac-
has already cost him two pets. “I couldn’t 2 cats: Zoe (2.5 years) Breed: doesn’t work like standard health insur- cess to insurance options for their pets.
find any insurance that covers such inci- and Penny (1.5 years) Indies ance where there the sum insured covers If you fall in this category or feel pet in-
dents,” Dr Thirumaal adds. However, his as- hospitalisation, surgery, etc. Instead, you surance does not align with your needs, it’s
sumption is misplaced. Most insurers offer can choose from several specific covers advisable to maintain an emergency fund
‘accidental injury cover’ that includes such offered by the insurer. Figuring out which dedicated to your pet. This will ensure that
scenarios. A deeper understanding of policy one suits your pet’s needs can often be any unexpected medical expenses don’t
inclusions and exclusions could help pet confusing. “It’s advisable to consult a vet strain your budget.
owners like Dr Thirumaal clear their misun- to determine which options are best suited
derstandings about what’s not covered. for you,” adds Dr Chaudhary. A pet’s breed,
The belief that pet insurance comes with age, and gender can significantly influence yasmin.hussain@timesofindia.com
too many exclusions is largely unfounded. its health needs—and consequently, the
Some of the pet insurance plans (see ta- insurance premium. For instance, golden
ble) available in the market cover most of retrievers are more prone to cancer-related
the commonly occurring illnesses like issues than other breeds. Hence, a terminal
fractures, cancer, or terminal diseases. illness cover is a must while purchasing
“Diseases that are typically excluded from insurance for them.
coverage are those rarely found in cats or
dogs, except for gastrointestinal issues, No cashless option
which may be covered with extra premium,” For starters, a typical pet plan offering cov-
says Dr Chaudhary. erage of up to `2-3 lakh costs around `10,000
Insurers also maintain transparency. a year, which is adequate for most standard
Exclusions are clearly listed in the policy veterinary needs. If you find the premium
r
Reason fog
brochure and are usually communicated too high, there is also the option of co-pay-

not buyin
during the purchase process. These could in- ment, where you agree to bear a fixed per-
e
insuranc
clude age eligibility, which is a common con- centage of the bill, and the insurer covers
cern among pet parents. Most insurers cover the rest. The higher the co-pay option you
pets between the ages of three months and choose, the lower your annual premium.
seven years, with renewals often allowed up One important thing to note is that cash-
Feels that products are
to 11-12 years. less claims are not currently offered by
Dental treatments are another common
not comprehensive any insurer in India. Pet parents need to
exclusion, but it shouldn’t be a concern. enough to suit the unique pay the veterinary costs up front and then
“Dogs usually develop dental issues at a needs of a cat, which is a file for reimbursement. This process can
much later stage, typically after 13-14 years misconception. sometimes take 2-3 months, depending on
of age,” says Dr Chaudhary. Given that most the claim’s complexity.
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP10 User: suresh.kumar Time: 07-04-2025 19:02 Color:

Interview
10 The Economic Times Wealth July 07-13, 2025

“Good opportunities are

available in mid-cap space”
Sectors like power, NBFCs, defence, chemicals and tourism are likely to perform strongly in 2025-26, says
Vikaas M. Sachdeva, Managing Director, Sundaram Alternate Assets, in an interview with Sameer Bhardwaj.
What is the biggest
Q lesson the market 70% is in listed equity, 15%
has taught you? What is your in real estate, and the rest is
Q personal asset split between commodities
Market will allocation right now? and unlisted equity.
always be dynamic,
and, therefore, one
must approach it
with a consistent RAPID FIRE Q
If you were to meet
Warren Buffett, what
philosophy and would you ask him?
mindset.
I would ask how he has
managed to stay so sane and
grounded throughout his career.

A good book
Q you would
recommend...

Start With Why by

Q If you were the Simon Sinek.
Sebi chief for a
day, what’s the one
policy change you
would make?

Fast-track the process Q

for resolving long-
pending cases as What investment Stay the course.
prolonged regulatory tip would you Don’t worry so much.
proceedings erode want to give your It always gets better.
investor confidence. younger self?

and quality is never cheap. Investing in

these companies is akin to betting on
India’s growth story. Despite trading at
Vikaas M. Sachdeva steep price-to-earnings multiples, a lot
MD, Sundaram Alternate Assets of companies in sectors such as cables
and wires, power, and consumption in
the mid-cap space are offering promis-
ing growth potential.
I wouldn’t be too flustered by the index-
level valuations. If one invests for the
The Nifty 50 index has bounced back rate growth trajectory. However, they can available in the mid-cap space, even at the long term and the growth rate in these
by 15% since April 2025, after a 15% take advantage of any spike in volatility or current levels. quality mid-cap names sustains at 15% or
correction between September 2024 and short-term corrections (due to the worsen- more, it still makes a lot of sense. In other
March 2025. What is your assessment of ing of the geopolitical scenario) as such You seem bullish on mid caps, but their words, investing in such high-growth
the current market movement? corrections will create tactical buying op- valuations appear stretched. The Nifty companies even at the current valuations
The domestic equity markets are dis- portunities. Midcap 150 index is currently trading will deliver decent returns over time.
counting most of the positive triggers and Large caps or most of the Nifty 50 stocks at over 50% premium to the Nifty 50 Besides, the valuation froth that was
are optimally priced at a broader level. are growing in single digits or early double in terms of price-to-earnings ratio (PE). visible in July-August last year has mod-
Therefore, the investors who are looking digits, but are valued at 15-20 times their What is your view on this? erated after the market correction. This
to invest in a broader market should wait estimated earnings. Though exciting op- There is a reason for the premium valua- provides a good enough reason to bet on
for the June 2025 quarter results to gain portunities are not available in the large- tion. Most of the constituents of the Nifty high-growth and high-quality mid-cap
clarity on the reliability of India’s corpo- cap space, a lot of good opportunities are Midcap 150 index are high-quality stocks stocks.
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP11 User: suresh.kumar Time: 07-04-2025 19:05 Color:

Interview
The Economic Times Wealth July 07-13, 2025 11

The Nifty 50 earnings moderated 87.1% 83.9%

Nifty 50 Nifty 500
significantly in 2024–25 compared to 73.1% 86.6%
2023–24. What are your expectations Percentage of 67.7% 64.9% Percentage of 75% 75.6%
for 2025–26? PMS schemes 58.1%
The earnings growth may not be very
AIF schemes 64.0%
impressive at the broad index level (Nifty that out- that out- 42.2% 44%
50) because sectors like IT and banking,
financial services and insurance, which
performed performed
have significant weightage, are expected the market the market
to register moderate growth. However,
compared to 2024-25, the performance of
benchmarks benchmarks
corporate India in 2025-26 will be better as 1 year 3 years 5 years 1 year 3 years 5 years
it will be supported by rising government Based on returns calculated on 31 December 2024. Source: PMSBazaar.
spending and a pick-up in private sector
capex. Every fundamentally strong com-
pany is expected to report decent growth
rates. The question is no longer whether
“Despite trading the recent past and the investors who were
positioned correctly in duration funds
include consumption, manufacturing,
financial services, and ‘phygital’ (like
they will grow, but rather how much they
will grow.
at premium have seen strong mark-to-market gains.
Though duration has largely played out
Zomato). In these themes, we consider
businesses that can grow faster than
Besides, analysing performance us-
ing the Nifty 50 index may not reflect an
valuations to large after the rate cuts, those who would still
like to position themselves here can con-
India’s nominal GDP. We prefer stocks
with a good return on capital and assess
accurate picture of the overall earnings
growth. This is because the Nifty 50
caps, many mid- sider five-year duration strategies. This is
because five years is neither too short, nor
their governance, dividends, cash-flow
consistency, and debt levels.
index doesn’t adequately represent the
full breadth of India’s market, and the cap firms in sectors too long, and it helps smooth out the im-
pact of any short-term spikes. The general Which alternative assets are worth
exploring at this juncture?
sectoral representation remains limited.
Moreover, the high-growth mid-cap stocks such as cables and tendency of the interest rate trajectory
will be downward, and will be supported Private credit is worth exploring. We
are ignored if one considers the Nifty 50 as by India’s strong economic growth pros- see investors with disproportionate
the only barometer for assessing perfor- wires, power, and pects, growing businesses and controlled exposure to equities, but there is a signifi-
mance. It is better to consider the Nifty 200 inflation. cant gap when it comes to credit, which
or the Nifty 500 indices, which are more consumption are Moreover, there’s a strong case for includes real estate, infrastructure and
diversified across sectors, for analysing investors to consider locking into high- structured credit. However, investors
performance or investment decisions. offering promising quality private credit strategies. Such op- must look at the quality, conviction, gov-
portunities don’t come very often and may ernance and vintage of platforms that are
With 2025–26 expected to outperform growth potential.” not last forever as the rate environment offering private credit.
2024–25, which sectors do you believe evolves. However, investing in high-yield Commodity ETFs is another area
will drive growth and which ones are bonds or securities without professional worth exploring. I believe the commod-
likely to lag behind? help is not advisable for most investors ity rally is just beginning and investors
Making a broader sectoral assessment, as it requires a deep understanding and are significantly underinvested in this
without limiting it to the Nifty 50 or Nifty risk assessment. Instead, accessing credit space, whether through ETFs or listed
Midcap indices, some of the sectors that through professionally managed vehicles, stocks. If the world moves into a high-
are expected to deliver strong perfor- such as debt PMS or credit-focused AIFs inflation phase, particularly in the US,
mance include power, NBFCs, defence, (alternative investment funds), will prove the commodities will perform well. In
chemicals, and travel and tourism. The more effective. the commodity space, gold, silver, copper,
sugar sector also looks interesting zinc and aluminium are likely to do well.
due to supply shortage. On the other Can you provide some insights into the While a pick-up in industrial activity
hand, the IT sector is expected to lag investment strategies employed by will support silver, supply shortage is
behind. It is a very different industry Sundaram Alternate for its equity and expected to aid zinc prices. The ongoing
from what it was in the early 2000s. The debt schemes? geopolitical tensions will continue to sup-
earlier growth drivers have shifted and For the debt PMS, we invest only in listed port gold prices.
it’s not yet clear what will drive the next debt securities. This provides a signifi-
leg of growth. cant comfort factor to investors as these Private credit is risky. We’ve seen how
instruments are publicly traded and Franklin Templeton India mutual fund
If you had to invest `10 lakh today for more transparent than unlisted credit. was hit. Though private credit has
a horizon of, say, one to two years, Secondly, we consider financial compa- shifted to PMS side and is only avail-
where would you prefer to allocate the nies and MFIs. These entities often ben- able to high and ultra-high net worth
capital? Why? efit from credit rating upgrades, which individuals, risk in the product remains
I would prefer a diversified approach that enhance the portfolio’s return beyond high. Can you mitigate this risk?
combines growth and safety, and will the fixed yield. Thirdly, we continue PMS offers professionally curated, struc-
invest across diversified equity schemes to strengthen our underwriting tured, well-researched, and actively
and high-quality private credit. In addi- practices, which enable us to develop managed exposure to private credit,
tion to this, a tactical exposure to silver performance-oriented strategies. something that individual investors
ETFs, a segment where most investors On the equity side, we focus on would find difficult to replicate on their
have negligible exposure, can add mean- four themes that act as our invest- own. If accessed through well-managed
ingful diversification. Furthermore, ment foundation. These platforms, such instruments offer a struc-
defence ETFs provide a very interesting tured and risk-managed option to capture
thematic opportunity. yield in a moderated rate environment.

Following the recent RBI rate cut in You are very bullish on private credit,
June 2025—50 basis point repo rate but have not mentioned private credit in
and 100 basis point CRR cut— your personal asset allocation. Is there
which fixed income strategy any reason for not including it in your as-
do you think suits inves- set allocation?
tors best in the current I intend to invest in it shortly. I’m very
environment? convinced about the product.
The duration strat-
egies have per-
sameer.bhardwaj@timesofindia.com
formed well in
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP12 User: suresh.kumar Time: 07-04-2025 19:06 Color:

investing
12 The Economic Times Wealth July 07-13, 2025

Accredited investors:
India’s empty elite club
Access to exclusive investment products, lower investing thresholds and regulatory concessions makes
accreditation appealing. However, investors, asset managers and intermediaries are yet to embrace it.

GETTY IMAGES
by Sanket Dhanorkar The exclusive club “The purpose of opportunities that are often restricted to
sophisticated participants,” says Sanat
“Money, money, money,
Sebi had introduced the framework for ac-
credited investors in 2021. The premise is
creating a separate Mondal, Head of Private Markets from
Sanctum Wealth.
Always sunny,
In the rich man’s world.”
simple: to carve out a less restrictive arena framework for ac- To be sure, bigger investors have the

C
for a class of investors savvy and informed option of investing in differentiated prod-
rooned by the iconic pop enough about the markets and having a big- credited investors is to ucts in the form of Portfolio Management
quartet, ABBA, once upon ger appetite for risk. It offers lighter regula- Services (PMS) and Alternate Investment
a time, this could well be tions and relaxed investment norms that provide lighter-touch Funds (AIF). As per regulations, the mini-
the theme song for a small
section of investors. The
accord greater flexibility to investors to gain
exposure to sophisticated financial instru- regulation.” mum ticket size is pegged at `1 crore for AIF
and `50 lakh for PMS. Accredited investors
well-heeled suffer from a particular ments. It includes various regulatory conces- can circumvent these limits. If accredited,
affliction: they find traditional in- sions, such as access to exclusive investment an individual may get to invest in a PMS
SHOBHIT MATHUR
vestment boundaries insufferably pe- opportunities, lower minimum investment for as low as `10 lakh or an AIF for `25 lakh.
CO-FOUNDER, IONIC
destrian. While retail investors wade thresholds, among other benefits. This reduced investment threshold allows
WEALTH BY ANGELONE
in the shallow end of mutual funds At its core, the idea of an accredited in- the investor to take diversified exposure to
and fixed deposits, the truly affluent vestor recognises that not all investors are 3-4 different strategies, rather than invest
eye the deep end with its promise of equal, says Sandeep Jethwani, Co-Founder, to `7.5 crore (with at least `3.75 crore in the entire sum in a single avenue. Mathur
uncharted returns. Dezerv. “Some investors possess the finan- financial assets). remarks, “The accredited investor can start
The ‘accredited investor’ designa- cial acumen and risk appetite to go beyond l Have an annual income higher than or small and diversify across multiple strate-
tion offers precisely this distinction— the standard investment requirements,” equal to `1 crore, plus a net worth greater gies and scale up later.”
a velvet rope separating the financial he adds. The purpose of creating a separate than or equal to `5 crore (with at least `2.5 Jethwani adds, “Previously, you would
cognoscenti from the merely comfort- framework for accredited investors is to crore in financial assets). commit your entire corpus to one fund man-
able. The capital market regulator, provide lighter-touch regulation, asserts The value of primary residence is not ager. Now, you can diversify across two-
Securities and Exchange Board of Shobhit Mathur, Co-founder, Ionic Wealth included while calculating the net worth. three exceptional managers with the same
India (Sebi), has created a two-tiered by AngelOne. “It serves an increasing tribe “The net worth criterion allows considering capital, accessing varied strategies and risk
system: the masses fish in heavily of high-value investors, who have a risk ap- the value of an unoccupied second house, profiles.”
patrolled waters, while the certified petite and seek aspirational opportunities, providing some leeway to individuals,” Apart from customised AIF and PMS
wealthy venture where both rewards not constrained by regulations.” points out Mathur. The income and asset offerings, an accredited investor can avail
and sharks are considerably larger. To qualify as an accredited investor, values are considered on the basis of latest of multiple other opportunities. They can
This begs the question: does this individuals must meet one of the following income tax returns or net worth certificate. tap into private placements, pre-IPO deals,
badge of financial sophistication de- financial criteria: If you fit the criteria, the accredited in- venture capital, private equity, hedge funds,
liver on its promise of exclusivity—or l Have an annual income higher than or vestor tag opens up a gamut of investment and other alternative investments that are
is it merely an expensive regulatory equal to `2 crore. opportunities. “Accreditation enables not available to the general public. Even the
theatre? l Have a net worth greater than or equal investors to access curated, high-quality upcoming SIF (specialised investment
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP13 User: suresh.kumar Time: 07-04-2025 19:07 Color:

investing
The Economic Times Wealth July 07-13, 2025 13

funds), which have a minimum outlay of

“It’s an acknow-
`10 lakh, will be available to an accredited
investor at a lower ticket size. This product Playground for the privileged ledgement from
combines the strategies of AIF and PMS
with the favourable taxation of mutual Get accredited for fractionalised, relaxed access regulators that
funds. Accreditation also lowers the bar- to unique financial products.
riers to overseas investments housed in you’ve earned the
the GIFT City. While regular investors can
access these AIF offerings for $1,50,000, an Who can be an accredited investor? right to invest like
accredited investor can get in at $25,000.
With the overseas liberalised remittance
To qualify as a Sebi-accredited investor, one must a sophisticated
scheme (LRS) limits currently fixed at
$2,50,000 per financial year, accreditation
meet either of the below criteria:
professional.”
allows investors to put in smaller amounts
in a single fund, leaving a sizeable chunk For Annual income OR Net worth
free for other pursuits. “Home country bias individuals, >=`2 crore >=`7.5 crore SANDEEP JETHWANI,
is very high among India’s HNIs. The GIFT
City AIF route offers a good way to diversify HUFs and (with at least `3.75 cr
in financial assets)
CO-FOUNDER,
OR DEZERV
overseas,” insists Mathur. family trusts Annual income
Besides, accredited investors get benefits Net worth
beyond unique investment solutions. “They mum of three years if the applicant
enjoy lower minimum investments, greater >=`1 crore >=`5 crore meets the eligibility criteria for the
(with at least `2.5 cr
flexibility in exposure limits, and more tai- preceding two financial years. At a
in financial assets)
lored exit options,” remarks Abhijit Bhave, Note: Income tax return or net worth certificate must be submitted as proof.
cost of `10,000 (two years) or `14,500
a wealth management expert. For instance, Value of the primary residence is excluded while calculating net worth. (three years) for every accreditation
in large value PMS (minimum investment certificate, this is a recurring ex-
of `10 crore), accredited investors get the pense. Experts feel there is not enough
benefit of placing 100% of their investment Why Access to differen- Regulatory Reduced entry incentive to seek accreditation.
tiated investment concessions thresholds
in unlisted securities, compared to the 25% become an opportunities Greater flexibil- Option to invest
“Unlike in developed markets, accred-
limit for regular investors (`50 lakh mini- itation does not consistently unlock
mum ticket size). Similarly, in large value accredited Pre-IPO deals, ity in exposure in products differentiated pricing, lower fees, or
private equity, limits, tailored like PMS with
AIF (minimum commitment of `70 crore),
accredited investors enjoy the privilege
investor... private credit, GIFT exit options, a lower ticket
exclusive rights,” says Mondal.
The general perception among
City AIF, among relaxation in fee size (see table
of allocating a higher percentage of their industry participants is that the ac-
others. structures. below).
assets under management (AUM) to indi- credited investor framework is still in
vidual companies within the AIF category I Minimum entry threshold a formative stage and needs improve-
& II (50%) and category III (20%), compared ments. “Regulatory clarity and incen-
to regular investors, who must adhere to a Regular investor Accredited investor tives around accreditation are still
25% and 10% allocation, respectively. evolving, especially on how it materi-
Accredited investors are also allowed re- PMS `50 lakh `10-25 lakh ally changes investment eligibility or
laxations in fee structures. “Even as regu- AIF `1 crore `25-50 lakh compliance burdens,” says Mondal.
lar investors face a capped fee structure,
limited to a maximum of 2.5% of assets un- GIFT City AIF $1,50,000 $25,000 Changes on the anvil
der advice or `1.25 lakh when it comes to en- *Offered by select asset managers.
Sebi has recognised the bottlenecks in
gaging with RIAs, accredited investors may the present machinery. It has recently
negotiate a more flexible fee arrangement,” ous, restrictive process of accreditation. floated a consultation paper, propos-
points out Jethwani. This may include hy- Why there Certification for accredited investors is ing some changes to the accreditation
brid, performance-based fees. Further, the are very few provided by accreditation agencies, which framework. First, eligibility criteria
accredited investor can benefit from both currently include only subsidiaries of stock for accreditation agencies may be ex-
advisory and distribution services via the takers... exchanges or depositories (CDSL Ventures panded, allowing all KRAs to function
same RIA. The strict rules barring advisers Limited and NSDL Data Management as accreditation agencies. With more
from offering products do not apply to this Lack of aware- Reluctance among Limited). In other countries, due diligence accreditation agencies, the present
cohort of investors. ness among HNIs investors to is typically conducted via the funds or ser- capacity constraints should be eased
Experts reckon getting accredited puts and family offices disclose financial vice providers in which investors are put- while fostering more competition to
power back in the hands of individual inves- about benefits. details. ting their money. The need for third-party facilitate cost-efficient servicing.
tors. “Reflecting on the accredited investor verification via dedicated accreditation Further, AIFs may be allowed to
framework, it is clear that it isn’t just about Tedious, restrictive agencies complicates matters. While the on- provisionally onboard an investor as
Service providers
giving the wealthy a new set of privileges. process of accredi- boarding process is largely smooth, the 3-4 an accredited investor, based on his
averse to lower-
It’s an acknowledgement from regulators ing ticket size and tation. week wait for certification remains a bot- due diligence, pending certification
that you’ve earned the right to invest like lose high-value tleneck, says Bhave. “The process remains from an accreditation agency. “The
a sophisticated professional,” asserts business. Limited shelf life unnecessarily complex and lengthy, with provisional onboarding proposal is
Jethwani. of accreditation. just two operational accreditation particularly smart, allowing fund
agencies. The sequential nature is managers to conduct due diligence
Limited appeal slips or income certificate, is a particularly problematic: inves- parallel to accreditation rather than
Despite its many benefits, the accredited concern for some. “In the mass There tors must get accredited before sequentially. This should signifi-
investor framework has not found many affluent segment, reluctance are only 649 fund managers can even be- cantly reduce the time-to-investment
takers. After four years, India is home to to disclose full net worth due accredited gin formal discussions, cre- without compromising verification
only 650-odd accredited investors (including to multiple adviser relation- investors in India, ating delays in competitive standards,” says Jethwani.
partnerships firms, family trusts and corpo- ships poses an additional compared to 24 deal environments,” asserts Further tweaks should give a shot
rates), according to Sebi. Comparatively, the hurdle,” points out Bhave. million in Jethwani. Market participants in the arm to a fledgling, yet promis-
USA boasts 24 million accredited investors. Apart from investors, the asset the US. indicate that wealth managers ing, concept. The adoption of accred-
Mondal points to lack of awareness managers and financial advisers and platforms find it easier to op- ited investor framework represents
among HNIs and family offices about the have also not warmed up to the con- erate under standard KYC norms. a natural evolution of a financial
accreditation process and its advantages. cept yet. There may be some reservation Further, accreditation has a limited shelf market growing in size and depth. It is
Reluctance of investors to disclose assets among service providers to offer a lower life. When granted on the basis of fulfilling a space to watch out for in the coming
and income details is another impediment. ticket size and lose high-value business, eligibility criteria for the preceding one years.
Submitting proof of income, such as tax fil- suggests Mathur. year, accreditation is valid only for two
ings, audited financial statements, salary Some market participants point to a tedi- years. The certificate is valid for a maxi- sanket.dhanorkar@timesofindia.com
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP14 User: suresh.kumar Time: 07-04-2025 17:12 Color:

stocks
14 The Economic Times Wealth July 07-13, 2025

Policy
tailwinds to
boost NBFC
stocks
The RBI’s interest rate cuts, increase
in liquidity stemming from CRR
reduction, and relaxation in norms
for gold and MFIs could lead to a
re-rating of NBFC stocks.

by Sameer Bhardwaj points in four steps between September and against property) stand to benefit the most,” tre performance in the June quarter,

N
November, a move that will lead to an infu- stated a recent ICICI Securities report. It meaningful gains are expected from
on-banking finance companies sion of an estimated `2.5 lakh crore liquidity expects the CoF to improve by 20-40 basis the second half of the current finan-
(NBFCs) have faced multiple into the banking system. This, in turn, is points in 2025-26 for most NBFCs. cial year and in 2026-27.
challenges over the past few expected to boost the net interest margins The relaxation on new gold loans will be The sentiment for the NBFC sector
quarters amid delinquencies in (NIMs) of NBFCs. effective from April 2026. The loan-to-value has improved since the policy meas-
unsecured loans, tight liquidity, The increased liquidity and lower rates (LTV) ceiling is being raised from 75% to ures were announced on 6 June. The
and rigorous scrutiny by the Reserve Bank will support NIMs by reducing the cost of 85% for loans with ticket sizes of less than group of 104 companies has generated
of India (RBI). funds (CoF). The NIM is the difference be- `2.5 lakh. This means that the gold loan- an equal-weighted average return
However, their performance is expected tween the interest income generated from focused NBFCs can lend more for every `100 of 3.6% between 5 June and 1 July,
to improve after cuts in interest rates and lending activities and that paid on borrowed worth of gold. This will make the borrow- compared with the Nifty 500 equal-
phased reduction in the cash reserve ratio funds. ings attractive and support the loan book weighted index’s 2.1% return.
(CRR) that will lead to an increase in liquid- “While the policy action is positive for expansion. These measures could result in
ity and boost credit growth. The relaxation the entire NBFC space, the players with In the second key relaxation, the central a re-rating of NBFC stocks over the
of regulations for NBFCs focused on gold high fixed rate assets (vehicle loans, loans bank dropped the qualifying assets thresh- next three to six months, led by an im-
loans and microfinance institutions (MFIs) old from 85% to 60% for NBFC-MFIs. This proved margin outlook, stronger bal-
will also help. Repo rate cuts spell is the minimum amount of eligible microfi- ance sheets and higher loan growth
Performance concerns were reflected in nance loans that NBFC-MFIs must hold on visibility, said Manish Goel, Founder
the share prices of NBFC companies in the
bonanza for NBFC stocks their books, allowing them to diversify into and Managing Director, Equentis
first five months of 2025. The group of 104 Lower cost of funds will improve NIMs. more profitable segments, such as affordable Wealth Advisory Services.
listed companies in the financial services housing or consumer finance. Here are the four NBFC stocks with
Month Repo rate (%)
and consumer finance space, with a market “With the qualifying asset threshold low- broad analyst coverage and a signifi-
cap of more than `100 crore, delivered an Feb ’25 6.50 ered, MFIs now have the flexibility to diver- cant buy rating.
equal weighted average return of -4.5% Jun ’25 5.50 sify their loan books, moving beyond tradi-
between 1 January and 31 May 2025. In com- tional group lending to slightly larger ticket Aditya Birla Capital
Feb ’19 6.50
parison, the Nifty 500 equal-weighted index sizes. This will help stabilise the earnings lT  he firm reported a steady perfor-
Aug ’19 5.40
delivered -1.5% during the same period. across credit cycles,” said Harshal Dasani, mance across business segments
Jan ’15 8.0 Business Head, INVasset, PMS. in the March 2025 quarter, with 6%
Policy support Sep ’15 6.75 An Emkay report has stated that the year-on-year growth in net profit.
The repo rate has been cut by 1 percentage NBFCs are set for risk-calibrated, profitable l It reported a strong loan growth in
point this year—25 basis points each in Jan ’13 8.0 growth, aided by the reduction in cost of both NBFC lending and housing fi-
February and April, and 50 basis points in May ’13 7.25 funding and easing of stress in some seg- nance—20% and 69% year-on-year,
June. The CRR is being lowered by 100 basis Source: ICICI Securities report ments. Though the report expects a lacklus- respectively. While the former
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP15 User: suresh.kumar Time: 07-04-2025 17:13 Color:

stocks
The Economic Times Wealth July 07-13, 2025 15

was driven by SME and corporate loans,

strong disbursements aided the latter.
What do the analysts say? Stock price returns
l Health insurance, life insurance and as-
set management also performed well.
Aditya Birla Capital PNB Housing Finance Company 6-mth 1-yr 3-yr

l The management expects margins to im- ANALYSTS’ ANALYSTS’

RECOMMENDATIONS RECOMMENDATIONS Aditya Birla 56.9% 16.9% 46.1%
prove in the future, helped by a fall in the Price (`) Price (`) Capital
BUY HOLD SELL BUY HOLD SELL
cost of f unds and a gradual increase in the
share of unsecured loans in its loan mix.
281 9 0 0
1,104 10 0 0 Aptus Value HF 9.9% -7.0% 3.1%
The modifications in the strategy for cus-
tomer selection in the unsecured segment PNB Housing 21.6% 38.0% 59.6%
will support disbursements in consumer Aptus Value Housing Fin. Shriram Finance Finance
and personal loans. ANALYSTS’ ANALYSTS’
l A Motilal Oswal report estimated a con- RECOMMENDATIONS RECOMMENDATIONS Shriram Finance 19.3% 19.1% 40.1%
Price (`) Price (`)
solidated return on equity (RoE) of 14% by BUY HOLD SELL BUY HOLD SELL
2026-27. 320 11 1 2 696 28 3 2
Nifty 500 5.0% 3.9% 20.8%

Aptus Value Housing Finance Price as on 1 July 2025. Source: Reuters-Refinitiv

Returns based on 1 July 2025 closing values.
Returns greater than one year are CAGR returns.
lT  he company reported a strong perfor-
mance in the March quarter, with 26% 32% CAGR. from large banks. March quarter due to a spike in credit
and 25% growth in net profit and AUM, re- lA
 n ICICI Securities report expects that lA  ffordable housing and emerging mar- costs and contraction in NIMs.
spectively, on a year-on-year basis. While the growth momentum will sustain ket segments currently constitute 24% of l Tepid demand amid weak government
volume growth supported the AUM, the due to the stringent credit monitoring, the loan book and the management plans capex and minor deterioration in asset
assignment transaction of `75 crore boost- strong collection mechanism, focus on to scale up such segments to 40% by quality weighed on its performance.
ed the net profit. geographical diversification and con- 2026-27. The increase in scale will impart l Going forward, the margins are expect-
l The company enjoys a strong capital ad- trolled opex. efficiency gains by reducing opex and ed to improve, helped by an improved
equacy ratio of 70%, which has helped it will lead to an improvement in return on product mix, rate cut, and expectations
to report robust return ratios. Moreover, PNB Housing Finance assets (RoA). of a higher government capex. Moreover,
its steady cost-to-income ratio makes it a lT  he NBFC reported a steady perfor- l With 70% of borrowings on floating rate, the asset quality is expected to stabilise
cost-efficient affordable housing finance mance in the March quarter, with 25.3% the rate cut will prove favourable by low- in the second half of the current finan-
lender. year-on-year growth in net profit. An ering the borrowing costs. cial year.
l Strong asset quality, steady credit costs uptick in high-yielding segments, pro- l A recent Nirmal Bang report remains l A recent Motilal Oswal report is bullish
and likely revival in disbursements in vision write-backs and efficient asset positive on the company due to its im- on Shriram Finance due to its market
2025-26 are some of the key positives. liability management supported the proved growth prospects, with expan- leadership, strategic diversification in
l Moreover, focus on increasing floating performance. sion in emerging markets and affordable high-growth, non-auto segments, poten-
rate borrowings, to benefit from the rate- l To enhance growth, the company’s man- segments, along with the improving tial for margin and operating efficiency
cycle reversal, and a high share of fixed agement is focusing on affordable hous- return ratios due to the likely NIMs ex- improvements, attractive valuations and
rate loans will improve spreads and prof- ing and emerging market segments. On pansion and benign credit costs. strong earnings visibility.
itability in the future. the other hand, the company is slowing
l The management expects the AUM to down disbursements in the prime seg- Shriram Finance
reach `25,000 crore by 2027-28, implying a ment due to the increased competition l It reported a subdued performance in the sameer.bhardwaj@timesofindia.com

US trading firm, Jane Street, facing heat in India

Sebi has barred the New York-headquartered company from the Indian securities market and impounded $567 million.
India has barred one of the world’s larg- profit of $5 billion by trading in equity
est quantitative trading firms, Jane options in India, according to the Sebi
Street Capital, from accessing its securi- order.
ties market after an investigation found Jane Street’s large India presence
it made ‘unlawful gains’, taking the most first gained prominence last year
stringent action ever against a foreign when the firm sued a rival hedge fund,
trading firm. Millennium Management, accusing it
The Securities and Exchange Board of of stealing a valuable in-house trading
India (Sebi), the markets regulator, also strategy.
impounded $567 million from the US- At a court hearing in the US, it was
based company, which said it disputed revealed that the strategy involved India
the findings. Here are facts about Jane options and had generated $1 billion in
Street and its India presence. profits for Jane Street in 2023. The two
firms settled the case in December.
What is Jane Street?
Jane Street has more than 3,000 em- Jane Street’s India challenge
ployees in five offices across the United India’s market regulator says Jane
States, Europe, and Asia. Street, as a group, first aggressively
The New York-headquartered com- bought significant quantities of banking
pany trades in stocks of 45 countries and standing of market mechanics to keep Hong Kong and Singapore. stocks and futures, temporarily pushing
is also rapidly increasing its presence prices consistent and reliable’. ‘We’re The firm started its first India unit up the banking index.
in Hong Kong by purchasing more office a firm of puzzle solvers on and off the in December 2020. The other two Asian Later, it aggressively sold large quan-
space. clock,’ according to the company. entities operate as foreign investors reg- tities of the same banking stocks and
Jane Street was established in 2000 istered with India. futures.
and its annual revenue last year was How it operates in India This large-scale buying influenced
$20.5 billion. It describes itself on its Jane Street operates in India through Scale of India operations retail investors to invest, leading to mar-
website as a firm that uses ‘sophisticated four group entities, two of which are Between January 2023 and March 2025, ket manipulation, Sebi said.
quantitative analysis and a deep under- based in India, with the other two in the four entities cumulatively made a — Reuters
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP16 User: suresh.kumar Time: 07-04-2025 17:20 Color:

The Economic Times Wealth

July 7-13, 2025

ET WEALTH TOP 50 STOCKS

Every week we put about 3,000 stocks through four key filters and rate them on a mix of factors. The end result
of this is the listing of the top 50 stocks based on the composite rating to help ease your f­ ortune hunt.
RANK PRICE ` GROWTH%* VA LUAT I O N R AT I O S R AT I N G

1 Fast growing stocks

Value
Current Previous Stock Net PEG Div No. of
Revenue PE PB Research
Rank Rank Price Profit (5-year) Yield (%) funds
Stock Rating

Can Fin Homes 1 1 815 10 14 12.7 2.1 1.1 1.5 32 ««««« Top 5 stocks with the highest
Muthoot Finance 2 3 2,635 34 23 19.9 3.6 1.8 1.0 69 ««««« revenue (1-year) growth (%)
HDFC Bank 3 4 1,987 19 3 21.5 2.9 1.4 1.1 304 ««««« AU Small 52.2
Finance Bank
Aavas Financiers 4 2 1,941 17 17 26.7 3.5 1.8 — 21 «««««
Cholamandalam 35.0
Petronet LNG 5 5 301 -3 9 11.4 2.3 1.3 3.3 32 ««««« Investment
Cholamandalam Investment 6 9 1,527 35 23 30.1 5.4 1.5 — 135 ««««« Home First 34.5
Finance Company
National Aluminium Company 7 6 192 28 165 6.7 2.0 0.1 4.2 36 «««««
Muthoot Finance 34.2
LIC Housing Finance 8 7 609 3 14 6.2 0.9 0.7 1.6 44 «««««

AU Small Finance Bank 9 8 812 52 23 28.7 3.5 1.1 0.1 49 ««««« Epigral 32.2

REC 10 11 393 19 12 6.5 1.3 0.5 4.6 88 ««««

ICICI Bank 11 10 1,426 17 14 20.0 3.3 1.3 0.8 303 ««««« 2 Least expensive stocks
The Federal Bank 12 12 217 19 2 12.8 1.5 1.0 0.6 103 «««««
Top 5 stocks with the lowest
Bandhan Bank 13 14 184 16 23 10.8 1.2 1.4 0.8 22 ««««« price-to-earnings ratio
DCB Bank 14 16 144 21 14 7.4 0.8 0.9 0.9 19 ««««« Ashoka
Buildcon 3.5
Repco Home Finance 15 17 432 11 12 5.8 0.8 1.2 0.9 11 «««««
Repco Home
Karur Vysya Bank 16 13 265 18 21 11.0 1.8 1.2 1.0 66 ««««« Finance 5.8

Chambal Fertilisers 17 19 565 -7 34 13.7 2.6 1.3 1.8 13 ««««« Power

Finance Corp. 6.0
City Union Bank 18 15 217 11 11 14.3 1.7 2.9 0.9 41 ««««« LIC Housing
Finance 6.2
Epigral 19 20 1,822 32 79 22.0 4.1 1.2 0.3 14 «««««
REC
KPIT Technologies 20 18 1,262 20 41 41.2 11.9 1.3 0.7 61 «««« 6.5

Best PEGs
Mahindra & Mahindra 21 101 3,174 17 11 30.5 5.1 1.2 0.8 194 «««««

IndiaMART InterMESH 22 21 2,580 16 65 27.9 7.2 1.2 2.0 29 ««««« 3

Hero MotoCorp 23 23 4,311 8 17 19.7 4.5 3.4 3.8 104 «««« Top 5 stocks with the lowest
Ashoka Buildcon 24 22 212 2 237 3.5 1.5 0.1 — 6 ««««« price earnings-to-growth ratio
National LG Balakrishnan
KFin Technologies 25 26 1,330 30 34 68.8 16.3 2.4 0.6 41 ««««« Aluminium Co & Bros
Gulf Oil Lubricants India 26 24 1,266 8 17 17.4 4.3 1.4 3.8 15 «««««
Coromandel International 27 40 2,234 9 26 31.9 5.9 2.2 0.7 68 «««««
0.07 0.15 0.42 0.49 0.55
Aadhar Housing Finance 28 29 464 20 12 22.0 3.1 1.4 — 31 «««««

Happy Forgings 29 99 982 4 7 34.2 5.0 2.4 0.3 18 ««««

Ashoka Natco
REC
Buildcon Pharma
Just Dial 30 30 927 9 61 13.5 1.7 1.1 — 5 «««««

Dodla Dairy 31 25 1,442 19 54 33.5 6.2 2.2 0.3 6 «««««

4 Income generators
Swaraj Engines 32 47 3,940 19 20 28.7 11.4 1.6 2.7 5 «««««

Eicher Motors 33 39 5,716 14 18 33.0 7.3 1.7 1.2 86 ««««« Top 5 stocks with the highest
Sundaram Finance 34 33 5,140 17 31 30.3 4.3 2.9 0.7 23 «««««
dividend yield (%)
Castrol India 5.9
Indegene 35 36 566 10 12 33.5 5.3 2.0 0.4 14 «««««
Gujarat Pipavav
5.2
Indian Energy Exchange 36 27 198 19 21 41.0 15.5 2.8 1.5 31 ««««« Port
NMDC 4.8
APL Apollo Tubes 37 92 1,729 14 3 63.4 11.4 1.8 0.3 62 «««««
REC 4.6
Aditya Birla Sun Life AMC 38 31 817 25 19 25.4 6.3 2.9 2.9 20 «««««
National
Castrol India 39 37 222 7 8 23.2 9.1 4.9 5.9 14 ««««« 4.2
Aluminium Co
LG Balakrishnan & Bros 40 41 1,305 10 10 13.7 2.5 0.5 1.5 6 «««««

NMDC 41 44 69 12 17 9.3 2.0 0.7 4.8 45 ««««« 5 Most widely held

Gujarat Pipavav Port 42 55 158 0 16 19.2 3.3 5.4 5.2 10 ««««
Top 5 stocks held by the most
Cipla 43 43 1,509 7 28 23.1 3.9 1.1 1.1 117 «««« number of mutual funds
Home First Finance Company 44 50 1,361 35 23 36.7 3.8 1.5 0.3 39 ««««« HDFC Bank Mahindra &
Mahindra
HCL Technologies 45 28 1,712 6 11 26.7 6.7 3.7 3.5 110 ««««

Alivus Life Sciences 46 38 1,033 5 3 25.8 4.5 6.5 0.5 13 «««««

304 303 194 135 117
Power Finance Corporation 47 49 415 17 16 6.0 1.2 0.5 3.8 112 ««««

Pfizer 48 77 5,783 4 39 34.7 6.3 12.1 2.8 31 ««««« Cipla

ICICI Bank Cholamandalam
Natco Pharma 49 46 974 11 36 9.2 2.3 0.4 0.6 5 ««««
Investment
Emami 50 48 559 6 12 30.3 9.1 1.8 1.8 58 ««««
SEE NUMBER OF MUTUAL FUNDS HOLDING THE
*REVENUE AND EPS FIGURES BASED ON ONE-YEAR GROWTH. DATA AS ON 3 JUL 2025. PERCENTAGES & RATIOS ROUNDED TO ONE DECIMAL PLACE. SOURCE: VALUE RESEARCH STOCKS IN THE ADJACENT TABLE.
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP17 User: suresh.kumar Time: 07-04-2025 17:36 Color:

loans and deposits

The Economic Times Wealth July 07-13, 2025 17

LOANS & DEPOSITS

ET WEALTH collaborates with ETIG to provide a comprehensive ready ­reckoner of loans and fixed-income
instruments. Don’t miss the information on investments for senior citizens and a simplified EMI calculator.

Top 5 bank FDs

TENURE: 1 YEAR
Interest rate (%) What `10,000 HOME LOAN RATES REPO
RATE
5.5%
compounded qtrly will grow to

Bandhan Bank 7.3 10,745.0

With effect from October 2019, all banks have made the transition
RBL Bank 7.1 10,729.1
to external benchmarks for pricing new home loans. Most banks
DCB Bank 7.0 10,718.6
have picked the RBI repo rate as the external benchmark.
J&K Bank 7.0 10,718.6 FOR SALARIED FOR SELF-EMPLOYED (%)
BANK RLLR (%) WEF
YES Bank 6.8 10,692.3 FROM (%) TO (%) FROM (%) TO (%)

TENURE: 2 YEARS Indian Overseas Bank 8.4 7.4 8.4 7.5 8.5 12 June 2025
Bandhan Bank 7.4 11,579.5 Bank of Maharashtra 8.3 7.4 9.4 7.5 9.9 10 June 2025
RBL Bank 7.1 11,511.4 Union Bank of India 8.3 7.4 9.8 7.4 9.8 11 June 2025
IndusInd Bank 7.0 11,488.8 Indian Bank — 7.4 8.8 7.9 9.3 Not available
J&K Bank 7.0 11,488.8 UCO Bank 8.3 7.4 9.0 7.4 9.0 9 June 2025
YES Bank 7.0 11,488.8 Canara Bank 8.3 7.4 10.3 7.4 10.3 12 June 2025
TENURE: 3 YEARS Bank of India 8.4 7.5 10.1 7.5 10.1 6 June 2025
Bandhan Bank 7.3 12,405.5 SBI Term Loan 8.2 7.5 8.5 7.5 8.5 15 June 2025
RBL Bank 7.1 12,350.8 Bank of Baroda 8.2 7.5 9.0 7.5 9.1 7 June 2025
YES Bank 7.1 12,350.8 Punjab National Bank 8.4 7.5 9.2 7.5 9.2 9 June 2025
DCB Bank 7.0 12,314.4 Central Bank of India 8.5 7.7 8.9 7.7 8.9 10 June 2025
IDFC First Bank 6.8 12,223.9 Punjab & Sind Bank 7.6 7.7 10.8 7.7 10.8 9 June 2025
TENURE: 5 YEARS J&K Bank 8.1 7.8 8.9 7.8 8.9 10 Feb 2025
DCB Bank 7.0 14,147.8 IDBI Bank 8.5 7.8 10.4 8.1 11.9 12 June 2025
RBL Bank 7.0 14,147.8 IndusInd Bank — 8.3 10.0 8.3 10.0 Not available
IDFC First Bank 6.8 13,975.0 South Indian Bank 9.8 8.3 10.6 8.3 10.6 Not available
YES Bank 6.8 13,975.0 HDFC Bank — 8.5 9.3 8.5 9.3 Not available
IndusInd Bank 6.7 13,906.4 Karur Vysya Bank 8.8 8.5 11.4 8.5 11.4 10 June 2025

Top 5 senior citizen bank FDs

Bandhan Bank — 8.7 12.8 8.7 12.8 Not available
Karnataka Bank — 8.7 10.9 8.7 10.9 1 June 2025
Interest rate (%) What `10,000
TENURE: 1 YEAR compounded qtrly will grow to ICICI Bank — 8.8 9.7 8.8 9.8 7 June 2025
Bandhan Bank 7.8 10,797.8 Axis Bank — 8.8 9.7 9.1 9.7 Not available
RBL Bank 7.6 10,781.9 Federal Bank — 9.2 10.0 9.2 10.0 Not available
IndusInd Bank 7.5 10,771.4
J&K Bank 7.5 10,771.4
YES Bank 7.3 10,745.0 Your EMI for a loan of `1 lakh
TENURE: 2 YEARS TENURE 5 YEARS 10 YEARS 15 YEARS 20 YEARS 25 YEARS
Bandhan Bank 7.9 11,693.6
IndusInd Bank 7.8 11,659.3 @ 7% 1,980 1,161 899 775 707
RBL Bank 7.6 11,625.0 @ 8% 2,028 1,213 956 836 772
J&K Bank 7.5 11,602.2
YES Bank 7.5 11,602.2 @ 9% 2,076 1,267 1,014 900 839
TENURE: 3 YEARS
@ 10% 2,125 1,322 1,075 965 909
YES Bank 7.9 12,626.6
FIGURES ARE IN `. USE THIS CALCULATOR TO CHECK YOUR LOAN AFFORDABILITY.
Bandhan Bank 7.8 12,589.5
FOR EXAMPLE, A `5 LAKH LOAN AT 10% FOR 15 YEARS WILL TRANSLATE INTO AN EMI OF `1,075 X 5 = `5,375.
RBL Bank 7.6 12,534.0
IndusInd Bank 7.5 12,497.2
DCB Bank
TENURE: 5 YEARS
7.3 12,405.5
Post office deposits Interest (%)
Minimum
­investment (`)
Maximum
­investment (`)
Features
Tax
benefits

RBL Bank 7.5 14,499.5 Sukanya Samriddhi Yojana 8.2 250 1.5 lakh One account per girl child 80C
YES Bank 7.5 14,499.5
Senior Citizens’ Savings Scheme 8.2 1,000 30 lakh 5-year tenure, minimum age 60 yrs 80C
IndusInd Bank 7.4 14,428.5
Punjab National Bank 7.3 14,357.8 Public Provident Fund 7.1 500 1.5 lakh p.a. 15-year tenure, tax-free returns 80C
Axis Bank 7.3 14,322.6 Kisan Vikas Patra 7.5 1,000 No limit Can be encashed after 2.5 years Nil

Top 5 tax-saving bank FDs 5-year NSC VIII Issue 7.7 1,000 No limit No TDS 80C

Interest What `10,000 Time deposit 6.9 - 7.5 1,000 No limit Available in 1, 2, 3, and 5 years 80C#
TENURE: 5 YEARS & ABOVE rate (%) will grow to

Bandhan Bank 7.0 14,147.8 9 lakh (single) Nil

Post Office
DCB Bank 7.0 14,147.8 7.4 1,000 5-year tenure; monthly returns
Monthly Income Scheme
15 lakh (joint) Nil
RBL Bank 7.0 14,147.8
IDFC First Bank 6.8 13,975.0 Recurring Deposits 6.7 100 No limit 5-year tenure Nil
YES Bank 6.8 13,975.0
Savings Account 4.0 500 No limit `10,000 interest tax free Nil
DATA SOURCED FROM ECONOMIC TIMES INTELLIGENCE GROUP
(ETIGDB@TIMESOFINDIA.COM). INTEREST RATES ROUNDED TO ONE DECIMAL PLACE. Data as on 3 July 2025 #Benefit available only for 5-year deposit
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP18 User: suresh.kumar Time: 07-04-2025 17:39 Color:

market watch
18 The Economic Times Wealth July 07-13, 2025

ALTERNATIVE INVESTMENT
RETURNS MONITOR
The scope and attractiveness of alternative investments is increasing. Here’s a weekly tracker of returns
from such investments. But don’t compare these with returns from traditional investments since the
proportion and purpose of alternative investments is vastly different.

Gold (995) (`) Silver(`) Platinum WTI Crude

71,937 96,947 89,698 1,07,620 997 1,375.5 83.6 67.4
3 JUL 2024 3 JUL 2025 3 JUL 2024 3 JUL 2025 3 JUL 2024 3 JUL 2025 3 JUL 2024 3 JUL 2025
PRICE OF 10 GM GOLD PRICE OF 1 KG SILVER ($/ TROY OUNCE) ($/BARREL)
CHANGE

u 1 WEEK 0.2% 0.4% -2.9% 3.3%

u 1 YEAR 34.8% 20% 38% -19.4%

PENNY STOCKS UPDATE

Penny stocks as a recommended non-traditional investment? Not exactly. ET WEALTH
neither has the expertise nor does it recommend investing in such stocks. But since the
relatively ‘low’ cost of investment attracts some investors to penny stocks, we provide
a weekly snapshot of this most volatile and uncertain type of stock investing.

Top price gainers Top volume gainers

MARKET 1-WEEK (%) 1-MTH (%) 1-MONTH AVG 1-MONTH AVG MKT CAP MARKET 1-WEEK (%) 1-MTH (%) 1-MTH AVG 1-MONTH AVG MKT CAP
STOCK PRICE (`) CHANGE CHANGE VOL (LAKH) VOL CHG (%) (`CR) STOCK PRICE (`) CHANGE CHANGE VOL (LAKH) VOL CHANGE (%) (` CR)

Onesource Industries 3.5 5.5 118.4 2.8 109.3 179.3 Ajcon Global Services 9.5 -9.2 25.3 0.3 5,002.9 58.3
Bisil Plast 1.7 1.8 86.0 0.7 217.6 93.5 Shangar Decor 0.6 -4.6 -4.6 175.9 3,161.8 30.4
Sellwin Traders 6.6 10.5 67.8 32.4 75.5 149.0 Gujarat Lease Financing 6.4 -3.9 10.0 — 3,020.0 17.3
Thirani Projects 6.2 20.1 54.4 0.6 900.7 12.5 Future Lifestyle Fashions 2.0 15.1 13.1 0.6 1,823.1 40.0
Pro Fin Capital Services 8.2 10.0 50.8 8.6 -23.3 261.4 Remedium Lifecare 1.1 18.7 -31.2 174.1 1,131.9 96.7
iStreet Network 7.6 27.2 46.9 0.1 -53.7 16.2 Mohite Industries 2.5 -9.2 -18 3.3 1,005.5 49.5
Tijaria Polypipes 9.5 15.2 45.6 0.2 340.1 27.2 Thirani Projects 6.2 20.1 54.4 0.6 900.7 12.5
Mishtann Foods 7.1 11.3 42.8 52 138.3 755.7 Padam Cotton Yarns 5.1 23.3 24.8 2.9 892.9 66.4
Glittek Granites 7.7 15.9 41.5 0.6 666.0 20.1 SIRL Financial Services 10.0 13.3 6.3 1.0 844.7 11.3
Sylph Technologies 1.2 -10.5 39.5 32.1 520.6 101.7 Mena Mani Industries 7.1 — 24.2 0.5 835.4 71.0

Top price losers Top volume losers

Sadhana Nitrochem 7.8 -22.5 -63.0 3.0 740.2 255.9 Quasar (I) 0.5 -18.2 -42.3 9.0 -94.2 21.7
Quasar (I) 0.5 -18.2 -42.3 9.0 -94.2 21.7 Harshil Agrotech 1.5 -0.7 -13.0 42.6 -79.2 104.6
Pulsar International 3.9 7.7 -34.6 3.3 21.2 27.9 Teamo Prodyction HQ 0.7 -4.0 -4.0 3.7 -74.9 62.9
Yamini Investment 1.1 3.7 -34.1 22.1 52.2 103.0 Growington Ventures India 1.8 -7.7 -15.1 2.0 -74.4 115.6
Remedium Lifecare 1.1 18.7 -31.2 174.1 1131.9 96.7 Dish TV (I) 5.0 1.6 -17.4 1.8 -68.7 920.7
Sharanam Infraproject 0.3 -8.1 -30.6 212.2 209.3 20.4 GV Films 0.4 5.7 5.7 56.1 -66.3 33.8
GACM Technologies DVR 0.7 -32.4 -28.1 18.7 661.5 13.2 AGS Transact Technologies 5.4 17.0 -3.4 1.2 -64.8 69.0
Vantage Knowledge Academy 7.7 -0.5 -26.9 3.0 165.3 262.3 Quadrant Televentures 0.4 — 25.7 18.5 -63.7 26.9
IGC Industries 3.9 -3.2 -24.7 2.2 36.7 13.7 Achyut Healthcare 3.8 7.3 10.1 1.8 -62.8 89.5
ARC Finance 1.0 -8.3 -22.7 199.9 116.4 90.0 Vakrangee 9.9 1.2 -2.3 2.6 -62.2 1,074.5

STOCKS HAVE BEEN SELECTED USING THE FOLLOWING FILTERS: PRICE LESS THAN `10, ONE-MONTH AVERAGE VOLUME GREATER THAN OR EQUAL TO 1 LAKH, AND MARKET ­C APITALISATION GREATER THAN OR
EQUAL TO `10 CRORE. DATA AS ON 3 JUL 2025. ALL FIGURES ROUNDED TO ONE DECIMAL PLACE. SOURCE: ETIG DATABASE AND REUTERS-REFINITIV
NG 3.7 PubDate: 07-07-2025 Zone: ETWealth Edition: 1 Page: ETWDP19 User: suresh.kumar Time: 07-04-2025 17:41 Color:

trendmap
map
The Economic Times Wealth July 07-13, 2025 19

Banking gets monetary

policy boost, IT still lags
Welcome to TrendMap, your quick, visual guide to the performance of different
investment segments. In this edition, we present an 11-year performance
tracker of various domestic market sectors. The annual returns are ranked for
nine key NSE sectoral indices. The map shows that no single sector reigns
supreme, which is why diversification helps, says Sameer Bhardwaj. THE ECONOMIC TIMES

Rank 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025*

Pharma Metals Real Estate IT Real Estate Pharma Metals Metals Real Estate Pharma Banks
1 9.5% 44.9% 101.0% 24.9% 25.7% 60.5% 69.4% 19.5% 79.6% 38.9% 12.5%

FMCG Energy Metals FMCG Banks IT IT Banks Auto Real Estate Infra
2 0.7% 19.5% 45.6% 14.4% 17.4% 54.2% 58.2% 18.0% 47.0% 33.8% 11.2%

IT Auto Banks Banks Energy Metals Real Estate FMCG Infra Auto Metals
3 -0.03% 9.8% 42.1% 7.3% 10.9% 16.4% 53.0% 17.5% 38.0% 22.8% 10.7%

Energy Banks Energy Energy IT FMCG Infra Auto Pharma IT Energy

4
1 -0.5% 6.7% 38.2% 1.4% 8.3% 13.0% 34.7% 13.5% 34.1% 21.4% 3.0%

1
5 Auto
-0.8%
FMCG
2.8%
Infra
32.9%
Pharma
-7.8%
Infra
2.0%
Auto
12.0%
Energy
33.3%
Energy
13.2%
FMCG
29.0%
Infra
15.9%
Auto
2.96%

Infra Infra FMCG Infra FMCG Infra Auto Infra Energy Metals FMCG
6 -9.6% -2.9% 29.7% -12.7% -0.9% 11.9% 17.9% 4.8% 28.6% 8.1% -4.4%

Banks Real Estate Auto Metals Pharma Energy Banks Pharma IT Banks Real Estate
7 -9.8% -6.0% 28.8% -19.5% -9.5% 5.8% 13.6% -11.0% 23.6% 5.4% -5.4%

Real Estate IT IT Auto Auto Real Estate Pharma Real Estate Metals Energy Pharma
8 -15.0% -6.9% 12.5% -22.3% -10.2% 5.4% 9.4% -11.8% 15.8% 4.9% -6.0%

Metals Pharma Pharma Real Estate Metals Banks FMCG IT Banks FMCG IT
9 -32.2% -14.3% -6.7% -33.2% -10.7% -2.6% 9.3% -26.8% 11.8% -0.9% -10.5%

Source: ACE MF. *2025 data is year-to-date based on 1 July 2025 closing values. Other years’ returns are calculated between the first and last trading day closing values.
Indices considered: Auto: Nifty Auto; Banks: Nifty Bank; Energy: Nifty Energy; FMCG: Nifty FMCG; Infra: Nifty Infrastructure; IT: Nifty IT; Metals: Nifty Metal; Pharma: Nifty Pharma; Real Estate: Nifty Realty.
 NG 3.7 PubDate: 07-07-2025 Zone: ETWealthMumbai Edition: 2 Page: METWDP20 User: suresh.kumar Time: 07-04-2025 17:50 Color:

your feedback & more...

20 The Economic Times Wealth July 07-13, 2025

Readers’ response, online and in print, to ET Wealth stories has been ­enlightening.
We pick some that add information and perspective to our articles from previous issues.
The cover story, ‘No child’s play’, made dividends, rental income, annuities or royalty.
for an informative read. It highlights
the importance of balancing dreams Poor parents’ dilemma Being mortgage-free and debt-free, with mini-
mal fixed expenses and sufficient medical
with reality, and the necessary invest- cover, reduces stress, an essential ingredient
ments required to excel as an A class The cover story, ‘No child’s play’, talks about for a happy retired life. If one has the freedom
player. The need for a back-up plan un- financial planning for parents who can afford a to travel, pursue hobbies, or volunteer without
derscores the critical aspect of strategic sports career for their kids, but poor parents of financial worries, it is a bonus.
thinking. Over the past three years, my talented children are in a dilemma whether to Mani Bhushan
son has been receiving tennis coaching, encourage them to pursue it as a career or take
making this article timely and relevant it up only as a hobby. The paradox is that only I truly appreciate the consistently insightful
for us. Thank you ET Wealth. when these kids win at the national or interna- articles by Uma Shashikant. These are not just
Darshan Godbole tional level do they get sponsorships, that too in informative, but deeply educative and practical.
select sports like cricket, badminton or chess. ‘Financial freedom comes at a cost’ is yet anoth-
Apropos of the cover story, I feel there Sportspersons also have a short career span er outstanding piece that highlights the reality
is no shortage of young, talented and, once they retire, sponsorships dry up. faced by Indian retirees and the importance of
sportspersons in our country. The only Hemanth D. Pai making conscious, inflation-adjusted financial
problem is finding and honing them. decisions. This article should be read by the
Of course, paucity of funds to get young generation that has just started earning
them trained, particularly by the right tion in this regard for providing coaching to at a cost’, Uma Shashikant has eluci- as early awareness about income protection,
coaches, is another deterrent. The gov- sportspersons, meeting their travel costs dated an important, though not a widely inflation-beating savings and disciplined retire-
ernment should create a pool of bud- and awarding huge cash prizes to winners of discussed, issue. For a retiree like me, ment planning is the need of the hour. I hope
ding sportspersons in different games, global tournaments. The world records set financial freedom means having enough that such impactful articles by the columnist will
provide world-class training, and bear by young Tamil Nadu grandmasters in chess savings, reasonable investments, and a continue in the future.
all expenses to help them participate in are a case in the point. regular income in a way that the corpus Vivek G. Laghate
international tournaments, not leave Tharcius S. Fernando is protected while maintaining liquid-
them to search for sponsors. The Tamil ity. There is nothing like passive income Please send your feedback to
Nadu government deserves apprecia- In her column, ‘Financial freedom comes because it too has to work, whether it is etwealth@timesofindia.com

What’s factor investing?

If you are confused by personal finance terms, jargon and calculations, here’s a series to
simplify and deconstruct these for you. In the 58th part of this series, Riju Mehta explains
the working of factor-based investing strategy.

Factor-based Since the strategy is based on high returns, and are likely to
research and data, it removes continue doing so.
investing emotional biases or guess work Quality: It focuses on picking
Investors use various strategies and leads to informed decision- companies with good financial
to maximise returns from making while picking stocks. health reflected in low debt and
stocks depending on the market consistent, stable returns.
performance and personal Types of factors Volatility: Here, one looks at
preferences or investing styles. stocks that have the ability to
One such strategy is factor-based There are various types of factors weather market volatility and
investing. that are considered while picking offer consistent returns.
In the 1960s, researchers securities. These include the Single- or multi-factor: Factor-
introduced the capital asset following: based investing can be done with
pricing model, which defined Value: This involves either a single factor or multiple
the relationship between market discovering undervalued factors, depending on the fund
risk and returns. This led to the companies with potential to offer house’s strategy.
evolution of a new investment high returns. Stocks are evaluated
on metrics like price-to-earnings,
strategy called ‘factor investing’,
price-to-book value ratio, etc.
Benefits
which took into account market
risk, or beta, as an important Size: This involves looking for This strategy is geared to deliver
factor impacting the returns of a smaller companies because they higher returns, reduce risk,
security. have the potential to offer higher provide diversification, increase
This strategy focuses returns than large-cap stocks. transparency and introduce
on specific attributes or Momentum: This strategy objectivity while picking stocks
characteristics that drive the considers stocks that have as it helps eliminate emotional
returns and risks of a security. displayed good performance and and personal prejudices.

The Economic Times Wealth is available at an invitation price of ` 8/issue. To book your copy, contact your newspaper vendor or call 1800 1200 004.
The Economic Times Wealth, published by Bennett, Coleman & Co. Ltd. exercises due care and caution in collecting the data before publication. In spite of this, if any omission, inaccuracy or printing errors occur with regard to the data contained in this newspaper, The Economic Times Wealth will not be held
responsible or liable. The content hereof does not constitute any form of advice, recommendation or arrangement by the newspaper. The Economic Times Wealth will not be liable for any direct or indirect losses caused because of readers’ reliance on the same in making any specific or other decisions. Readers
are recommended to make appropriate enquiries and seek appropriate advice before making any specific or other decisions.

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of news under PRB Act). © Reproduction in whole or in part without written permission of the publisher is prohibited. All rights reserved. RNI No.: GUJENG/2014/55568.