Long story, short. Your portfolio & the week that went by!

Markets have corrected to a new low
“Oh no! It’s time to go!”

Markets have touched a new high
“It’s too expensive to buy!”

There may be a hundred reasons to not;
But it takes just one to escape the rot.

Sadly though, there is no reason adequate
for the fence-sitters choosing to simply wait.

The week and the month ended on an ecstatic high. NIFTY clocked a gain of over 7.5% only in the past six days while Sep’19 ended with month-over-month growth of 4.5% as the index reclaimed the 11,500-levels.

The finance ministry’s corporate tax rate-cut gift to India Inc. last weekend was well-received by capital market participants as domestic & foreign investors pumped in the capital in expectation of a spur in the earnings recovery rate. Modi’s visit to the Oval Office is expected to garner positivity for the Indian economy – especially around strengthened trade relations, improved tourism sentiment and influx of foreign capital into the home economy.

However, as the month wrapped, President Trump once again featured in global headlines as reports of progressing impeachment proceedings materialize coincided with his offensive strike against China which included announcing an intent to delist all China-based companies off the U.S. stock exchange.

Having said that, Indian capital markets have been quite resilient in the face of such escalating tensions between two super-economies as it basked in the comfort of an imminent consumption and earnings revival.

Here’s how the past week looked like:

Investors are advised to continue investing in a systematic fashion, sticking to asset allocation. If permitted by one’s risk & investment profile, preferences can be skewed towards a large & midcap allocation blend (large-cap orientation) and funds with meaningful exposure to banks, automobiles & IT as sectors.

Why choose mutual funds as your go-to investment option?

“An investment in knowledge pays the best interest.”
–Benjamin Franklin

Mutual funds are one of the most lucrative personal investment options available in India and it is has been booming in recent years with the advent of increasing accessibility, powered by the Internet. But, before we give you the reasons to consider investing in mutual funds it is essential that you decide on it with at least the basic understanding and knowledge of mutual funds.

What are Mutual Funds?

A mutual fund is simply a professionally managed investment fund that collects money from different investors to purchase company shares, stocks, or bonds. A mutual fund is generally managed by Fund Managers, who drive this investment vehicle to earn the highest possible returns.

In short, mutual funds are:

  • Money pooled from many individuals.
  • Professedly managed by Fund Managers
  • Well regulated by SEBI (Securities Exchange Board Of India)
  • Allowing you to invest in small amounts
  • Helps you earn returns higher than Fixed Deposits

What Makes Mutual Funds ‘Click’, for Investors?

This particular investment instrument is loaded with a lot of features and benefits. Let’s take a closer look at them:

  • Diversification:- Mutual Funds invest in 50-100 different investments. This feature reduces the risk of loss for an investor because it allows the investor to maintain a diversified investment portfolio.
  • Professional Management:- Mutual Funds are managed by professional fund managers who back the purchases with active research using financial methods and historical data of the fund. They make sure to put in a thorough analysis before picking the right companies to invest in, thus making sure that the scheme fulfills the investment objective.
  • Ease of Buying and Selling:- Investors can invest in Mutual Funds online within minutes. It spares cumbersome paperwork that investors have to go through if they have to invest from a bank. All you need is to complete the paperless online KYC (Know Your Customer) process, which takes less than 5 mins, and you are ready to invest.
  • Affordability:- Investments as small as Rs. 100 via SIP (Systematic Investment Plan) can be made and still allow the investors to earn high returns. However, the thumb rule is to stay invested for long periods to reap the benefits of the fund more.
  • Wide Range of Funds:- You are unique, and so are your investment goals. Mutual funds have a wide range of investment options that allow you to invest in funds that suit your risk capacity, financial situation, and investment goals. Right from equity to debt to hybrid funds, you can achieve all your investment needs with Mutual funds.

Why Should ‘You’, Invest in Mutual Funds?

Mutual funds make investing easier for you because each fund is designed to address different financial goals.  The most convenient way to invest in mutual funds is with SIP (Systematic Investment Plan). This allows you to start your investment with a minimum of Rs. 100 or more, based on your financial portfolio. A smart mutual fund investor always starts early. The more you delay, the more you will lose out on making higher returns.

How Can You Invest in Mutual Funds?

Investing in mutual funds is easy and have the following options:

  1. Direct investment
  2. Through Agents or Brokers
  3. Online (Recommended)

Why Invest in Mutual Funds Online?

There are innumerous benefits of investing in mutual funds online. Here are the reasons that matter:

  • Speedy Business Deal: The main benefit of online investment is the rapid execution of business transactions. With a simple click of the mouse, the investor can buy shares.
  • Simple Execution and Mere Formalities: We all know India is in the phase of digital transformation. People nowadays prefer online investment because it is an easy and time-saving mode of investment. There is no involvement of paperwork, all you need to do is update your bank details and complete the KYC (Know Your Customer) process, making you ready to invest online.
  • Comfort and Easy Accessibility: It offers the advantage of sitting at the comfort of your home and invest. The investors don’t need to travel for various deals. Instead, complete certain formalities online, and you can get all the investment options at your fingertips.
  • Secured Dealing: These days, online applications have been upgraded to provide the best security to the investors and make sure that their investments are safe and reliable.

Why Choose Finity – Wealth App to Invest in Mutual Funds Online?

Finity – Wealth comes fully charged and advantageous for the smart investor in you. Here’s how:

  • Zero Commission and Zero Fees
    You can invest in Direct Plan Mutual Funds on Finity for free. You don’t have to pay any commission or fees to brokers or agents. Hence, you don’t lose a substantial amount of your investment money.
  • Portfolio Rebalancing
    Finity – Wealth comes with this feature that helps you to get your risk covered through regular and periodical balancing of your investment portfolio.
  • Smart Recommendation Engine
    Finity’s smart recommendation engine suggests funds that have outperformed the market based on significant financial models and historical data.
  • Insta Switch
    This feature allows you to switch from your regular plans to direct plans making it possible to earn 1-1.5% more returns on your investment.
  • Advance Research Reports
    Investors get access to superior, advanced, and smart fund reports. As an investor, this gives you complete control of your investments with complete transparency.
  • Portfolio Alters 
    This feature allows investors to remain updated about his/her current portfolio at any time, anywhere, allowing you to invest to make informed decisions.

What Makes Finity – Wealth Safe and Secure for Your Investments?

Investments made on Finity is 100% safe and secure, since:

  • Finity is a SEBI registered investment advisor. (INA200005323).
  • Provides Bank Grade Security
  • All orders are executed via the Bombay Stock Exchange
  • 256-bit secure socket layer (SSL)
  • All payments are routed via BillDesk.

It is wise and necessary to remember that as an investor, it is of utmost importance to choose mutual funds based on your risk capacity and financial background. Education, awareness, and sound judgment can ensure that your investment journey with mutual funds will be fruitful and productive.

Download Finity – Wealth and start building your portfolio today.

Hot NFO Alert: Motilal Oswal Large & Midcap Fund (27 Sep’19-11 Oct’19)

Motilal Oswal has launched a New Fund Offer in the large & midcap category – Motilal Oswal Large & Midcap Fund. The category & NFO is expected to benefit from the evolving economic scenarios by way of capturing the uptrend and insulating against headwinds in an optimal fashion.

The fund is suitable for investors having a long-term investment horizon and seeking optimal appreciation across cycles.

You can invest (or access more scheme-related information) by launching the Fisdom app and choosing the “NFOs” option at the bottom of the home screen and clicking on “Motilal Oswal Large & Midcap Fund”.

Fund Overview:

The fund will be managed by Aditya Khemani & Abhiroop Mukherjee (star fund managers at Motilal Oswal). The targeted ratio between large & midcap is expected to be at 50:50; however, the AMC may have an underlying philosophy of maintaining at 35:35 with the rest being flexible for allocation between equities and debt. The fund has an exit load of 1% if redeemed within 15 days and none thereafter. Offer NAV at INR 10/unit.

Given our primary interaction & understanding with the AMC, the fundamentals and philosophy seem well-positioned considering currently evolving market dynamics.


The case for large-caps (NIFTY15) remains evergreen as it has known to withstand headwinds and leverage tailwinds effectively while continuing to grow efficiently. The case for large-caps is further strengthened by the current stimulus-orientation with the understanding that such measures will percolate from top to bottom of the market-cap pyramid across sectors.

As far as midcaps are concerned, Midcaps’ relative valuation (P/E) vs. NIFTY is at 2012-13 level lows – also the zone which marked the beginning of the midcap bull rally through 2014. The Nifty Midcap-100 market-cap is currently at a 5-year low with the rolling1-yr differential b/w NIFTY midcap-100 & NIFTY being at a historical extreme. Though there’s a strong case for a revival in the midcap space (albeit by tagging-along with the broader market), quality of stock-selection has become all the more critical within the space. We are confident that Motilal Oswal through its fund management team & framework along with institutional depth has the ability to deliver.

In case of any queries/concerns, feel free to reply to this e-mail and we would be glad to assist.

Save up to Rs. 46,800 in taxes and earn returns up to 15.11% (past 3Y)!

If you desire to earn high returns & save taxes under Section 80C, then Finity has the right fund for your investment goal. Here is India’s #1 Ranked ELSS Fund for past 3Y returns.

“Mirae Asset Tax Saver Fund (Direct-Growth)”

Rated 5-star by Morningstar, CRISIL and Value Research

Return Capacity: High
Risk level: Average Risk
Category: Equity-ELSS (Open-ended)
Last 5 yr returns: 15.04% (as of September 26, 2019)
Min. SIP Amount: Rs. 500
Min. Lump-sum Amount: Rs. 5000

It is an equity-linked saving scheme with a 3 year lock-in period. By investing 72.52% is in large-cap stocks and just 25.76% in small & mid-cap stocks, this fund reduces risk due to equity exposure.

Mirae Asset Tax Saver Fund has yielded 15.04% CAGR (past 3Y), which is 6.71% more than the return of its benchmark – NIFTY 200 Total Return Index in the same 3Y duration (at 8.33%). Thus, generating long term capital appreciation from a diversified portfolio.

This fund provides a tax exemption of Rs.1.5 lakhs & tax-free returns on long term capital gains (LTCG) up to Rs. 1 lakh. Thus, it is a real winner when compared to other tax saving options such as EPF/ PPF (8%), Tax Saving FD (7-8%) and NPS (8%).

Toh der kis baat ki?

Find out how a cut on corporate tax rate affects your investments

“To fight is a sign of courage, but to live to fight another day is wisdom.”

The first full-time lady finance minister of independent India has turned Santa Claus with the biggest gift in the form of a corporate tax rate cut.

The basic tax rate for corporates has been trimmed down from an effective 34.94% to a much lower 25.17% (only if for companies who agree to forego all other concessions & exemptions).

For some companies who choose to remain under the old rate, the MAT reduction from 18.5% to 15% could benefit.

Minimum Alternate Tax ensures that companies with profits under a threshold are covered under the tax rate though the tax liability may be minimal or even zero.

Tweet tax cut

Our Economy
This improved liquidity with a competitive landscape will enable companies to spend more towards driving sales in a more aggressive fashion.

Once consumerism is spiked, and the supply-side starts reacting, we will have the economic engine push with higher horsepower.

The Highlight
Commercial banks and IT are expected to benefit the most from the move. Given that these sectors have a significantly high-weighted representation on the indices, we could expect to see index valuations getting enriched as well.

tax rate

Investor Gain
Investors must capitalize on this opportunity while bearing in mind the government and central bank’s collaborative alignment towards reviving the Indian economy by buying equities in the form of Direct Mutual Funds while averaging their cost at all junctures.

3 FAQs about the safety of your investments on Finity

With 3 months left, the year 2019 has witnessed total SIP contributions of Rs 32,867 crore, thereby, clearly indicating that financial products are gaining high popularity among Indians. Even though Finity makes it very easy to signup and finishes paperless KYC in 5 minutes to start investing in Direct Mutual Funds, yet many of our users do hesitate to make their first investment. As Head of Research at Finity, I have answered some of the questions that you may have regarding your investments with Finity app:

1. What happens to my investments in case Finity shuts down?

Finity is just a distributor of Direct Mutual Funds. As an intermediary, your money never comes directly to Finity. Instead, your money goes to the AMC (Asset Management Companies such as SBI, ICICI, Motilal Oswal, etc) associated with the Mutual Fund you invest in. Thus your money moves from your bank account to the mutual fund’s bank account directly. Similarly for redemption, your money is credited by AMC directly to your bank account. If the app/platform shuts down, your units would be safe as long as you have the folio number (which you can get from your eCAS i.e. Consolidated Account Statement which is available from Karvy, CAMS or SBFS) – and then you would just need to find a different app for your mutual fund redemption/investments.

2. But the markets are falling, should I withdraw my investments?

Its common to panic and stop SIPs when the markets are down due to fear of loss. However, a fall in the market is an opportunity to buy more at lower prices, and this will help you achieve your long-term goals. Remember: Every bear trend is followed by the bull, resulting in the recovery of the market. Thus, time in the market is vital rather than timing the market.

3. Is it safe to invest on Finity?

Finity is a SEBI Registered Investment Advisor (INA200005323) & registered with the Association of Mutual Funds in India (AMFI). Moreover, these reasons make Finity the safest and secure investment platform in India:

  • Our payments are routed via BillDesk (PCI – DSS Compliant)
  • All orders placed on Finity are executed via the Bombay Stock Exchange (BSE).
  • Our app uses 256-bit Secure Socket Layer (SSL) encryption, to offer bank-grade security.

What are you waiting for? Click the button below to invest in 0% commission Direct Mutual Funds now:

18% returns (past 5Y) in Mirae Asset Emerging Bluechip Fund. Invest Now!

Mirae Asset Emerging Bluechip Fund Direct-Growth

★★★★★ Rated 5-star by Morningstar, CRISIL and Value Research

Return Capacity: High
Risk level: Above Average Risk
Category: Equity: Large & Mid Cap (Open-Ended)
Last 5 yr returns: 18% (as of September 25, 2019)
Minimum SIP Amount: Rs. 1000

To boost total returns of your financial portfolios, we as SEBI Registered Investment Advisor suggest you take some risk by allocating at least 15-20% of the total portfolio in large & mid-cap funds. We recommend investing in Mirae Asset Emerging Bluechip Fund (ranked #1 in Large & Mid-cap category based on past 5Y Returns).

  • To reduce the risk that comes with equity exposure, the fund is well-diversified between small-/mid-/large-cap stocks (out of its 99.64% investment in Indian stocks – 52.41% is in large-cap stocks, 34.03% is in mid-cap stocks, 13.2% in small-cap stocks.)
  • Even though markets are down in past months (causing this fund’s benchmark, NIFTY Large Midcap 250 Total Return Index, to give 8.75% 5Y returns), Mirae Asset Emerging Bluechip Fund has yielded excellent returns of 18% (past 5Y CAGR), which is 9.25% more than the returns of its benchmark.
  • Fund manager’s insistence on a disciplined approach to investing, with a focus on quality up to a reasonable price along with diversification, has helped the fund in delivering consistently high returns with this fund when compared with other funds in the same category.

Nirmala Sitharaman’s announcement: A coin has THREE sides!

The first full-time lady finance minister of independent India has turned Santa Claus with almost every consecutive weekend being Christmas. She comes bearing gifts for the economy and this weekend was no different – this time the biggest gift was in the form of a corporate tax rate cut.

While the streets are filled with euphoric traders and sceptical economists with contrasting opinions ranging from “this was much needed” to “fiscal prudence is now becoming a myth”, there’s one tale I remember from childhood which captures the current situation aptly. Here’s an excerpt:

It was late at night, the streets filled with silence. Ajay, a professional martial artist, had a long day and walked slowly down the lane leading to his home. Just as he approached the corner, he found himself surrounded by four local ruffians, armed with pocket knives– it was a legitimate armed robbery! Ajay’s pace slowed down as thoughts raced ahead. With knives pointed towards him, he was threatened and asked to hand over all his valuable belongings.

Contrary to what you may have expected, Ajay simply handed them over and got himself out of the situation at the earliest. Back home, he narrated this incident to a friend who had come over for dinner. Upon hearing the entire episode, the friend asked in surprise, “You’ve been training all your life for such a situation, then why to back down when the moment arrived?” to which Ajay offered a profound explanation – “When outnumbered and all odds are against one; to fight is a sign of courage, but to live to fight another day is wisdom.”

The response stuck in my head –
“To fight is a sign of courage, but to live to fight another day is wisdom.”
We’ll get to this in a bit
So, what did the government exactly propose?

The government proposed a steep cut in the basic tax rate for corporates. It has been trimmed down from an effective (incl. surcharge & cess) 34.94% to a much lower 25.17% given that a company may opt to be taxable under this rate regime only if it agrees to forego all other concessions & exemptions it may have availed. However, even for some companies who choose to remain under the old rate, the MAT reduction from 18.5% to 15% could benefit. Minimum Alternate Tax is nothing but a provision to ensure that companies with profits under a threshold are covered under the tax rate through the tax liability may be minimal or even zero.

But we are running in deficit. How can the government sustain such a revenue loss?
True. In her statement, the Finance Minister mentioned that the revenue foregone through the tax cut and other relief measures is to the tune of INR 1.45 lakh crores. However, the idea is that this loss is expected to be temporary as the resultant spur in the economy is expected to not only set-off against this loss but also create the foundation for a more robust economy.

“To fight is a sign of courage, but to live to fight another day is wisdom.”

Taking the assistance of simple mathematics, if the price-to-earnings ratio (the price of all listed shares dividing by earnings per share) of nifty today is c. 27x and the excess liquidity transferred by way of tax-saving (equals revenue foregone by the government) is INR 1.45 lakh, it effectively translates to a valuation jump in Indian equities to the tune of approx. INR 39.2 lakh crore to justify the current, reasonably strong valuation. Obviously, this is a crude way to compute but should help offer perspective to the situation.

How does this affect me as an investor? Why did markets zoom by almost 5% in a day?
India Inc. has been asking for this since a long time now – it helps strengthen Indian companies’ position vis-à-vis global peers in the international market while significantly adding to the bottom-line.

For shareholders, this is essentially an upward revision in their profitability estimates. With a lower tax incidence, more money is left with the company which can flow in either of the two directions – direct increment in shareholder value through higher dividends and increased earnings per share or increased capital allocation towards productive expenses.

But then, is this simply a tactical move or is there something more structural?

Drawing on from the fact that companies are expected to have significantly improved cash flows and will utilise it in one way or another, the expectation is that this improved liquidity with a robust competitive landscape will enable companies to spend more towards driving sales in a more aggressive fashion. Once consumerism is spurred and the supply-side starts reacting, we will have the economic engine push with higher horsepower.

Are there any specific sectors that stand to benefit strongly?
Sectors with a significantly higher effective tax rate (net of exemptions, reliefs & surcharges) are expected to be benefitted the most in a quantum directly proportional to the difference in current and proposed rate.

Commercial banks and IT are expected to benefit the most from the move. Given that these sectors have a significantly high-weighted representation on the indices, we could expect to see index valuations getting enriched as well.

As an investor, what’s the actionable?
With this booster shot to the economy coupled with gradually improving on-ground liquidity situation and upcoming festive season, we can expect an uptick in consumerism, albeit of limited magnitude. Investors must capitalise on this opportunity while bearing in mind the government and central bank’s collaborative alignment towards reviving the Indian economy by buying into equities while averaging their cost at all junctures. Investors may choose to invest in multi-cap & large-cap funds with higher exposure to financial services and IT as a part of the sectoral diversification. However, it is strongly recommended to stick to asset allocation while taking investment decisions.

For those still pondering about the right way to navigate through the current market scenario, feel free to simply reply to this email & let us guide you through the jungle that the financial markets have become.


Hospitalisation Cash Benefit Plan

Hospital daily cash plans act as a supplement to the standard health cover. Let’s understand this plan in detail.
The hospital daily cash plan is a health plan which provides a fixed amount for each day you are hospitalized. The amount paid is set at the time of policy and remains fixed. The program is a defined benefit which means that it pays a fixed amount irrespective of the actual amount of expenses.
So, if you are hospitalized with a plan which pays Rs.800 per day of hospitalization, whether you incur Rs.600 or Rs.1400 as actual charges would be irrelevant, and the insurer would pay a fixed benefit of Rs. 800 for each day of your hospitalization. (more…)

What are Unit Linked Insurance Plans?


Unit Linked Health Plans/ Unit Linked Insurance Plans (ULIPS) is a combination of market-linked investments and health insurance cover. Along with health protection, it also helps build a corpus that can be used to meet expenses that are not covered by health policies.
The cost of every health plan depends on age, gender, health, and other factors. It is a mixture of investment and insurance. A premium amount you pay is divided into two parts:

  • where a part of your premium is invested,
  • and remaining is used to buy a cover.

Thus, this plan offers both return and safety. Returns earned are utilized to pay for medical expenses, over and above the insurance limit. Remember, the investment and returns you receive are subjected to market risk. The returns earned will be paid back to you on the date of maturity/ on the completion of policy duration.