In this episode of ET Now’s The Money Show, News Editor Kavita Thapliyal discusses with Piyush Chandra, Head of MF Products in IIFL Securities discusses SIP and strategies of investments.
Do you want to become a crorepati and that too in 10 years? In this episode of ET Now’s The Money Show, News Editor Kavita Thapliyal discusses with Piyush Chandra, Head of MF Products in IIFL Securities discusses SIP and the strategies of investments that an investor should follow to grow his/her money in a short period of time.
Sharing the strategies about how an investor can turn Rs 10 lakh into Rs 10 crore in 10 years, Chandra said: “Practically it is impossible to grow Rs 10 lakh investment today. If you you look at the calculation even if one does a SIP every month for 10 years at a 12 per cent CAGR return, the SIP amount would be Rs 4.35 lakh per month and for this, he has to continue the SIP for the next 10 years.”
“If I look at something like 10 per cent kind of average return from the market, the SIP amount for that amount will be Rs 4.85 lakh. So to say to invest Rs 10 lakh for 10 years and to make it Rs 10 crore is practically impossible,” he added.
Further discussing the strategies on how an investor needs to invest for achieving that target to earn Rs 10 crore in 10 years, the expert said: “It would depend on the investor and the risk appetite that it has to you. Just to discuss this investment strategy or wealth creation journey, I would like to divide this conversation into three important points, first is the strategy that one should look for building long-term will, second it should be how one should invest in the market and the third is the most important. It is something that one needs to be avoided or things one shouldn't do in the wealth creation journey.”
“Let’s look at strategies that one should have to build on long-term creation or long-term wealth. Firstly, the investor should have a clear investment objective. Let’s say my investment objective is Rs 10 crore every 10 years so I should have a very clear investment objective and now obviously I shouldn't look at short-term returns because they can be volatile and now most importantly, I just shouldn't pull out money, as and when required because the easiest thing in the financial instrument is because they are very liquid, people tend to withdraw money as and when required. Obviously starting early and staying invested helps and you need to review your portfolios on a very periodic basis and rebalance the portfolio accordingly. I think these are the key investment mantras to build long-term wealth,” Chandra further said.
“Obviously if I am looking out for an aggressive return I need to be aggressive while investing. So, mid-cap and small funds stocks as historically, mid-cap have given better returns as compared to large cap. So, my portfolio has to be mid-cap heavy but having said that it would entirely depend on the risk appetite of the person. And stay invested for a long duration. In longer-term investment, the compounding works,” explained while sharing about the right kind of portfolio to earn big in a short period.
How To Grow 10 Lakh Into 10 Crore In 10 Years | The ET Money Show - WATCH FULL VIDEO
