Living Retirement Kingsize – Investing @ 40's

Equity Market

Global equities

• For the month ended 15th October 2012, global equity indices ended on a weak note, much attributed to the increased concerns about the worsening European Debt crisis and on the expectation that stimulus measures being adopted may not be enough to boost economic growth.

• International Monetary Fund (IMF) in its recent issue of World Economic Outlook has lowered it global growth forecast to 3.3% for 2012 from 3.5% as forecasted earlier while for 2013 the growth rate has been revised from 2.0% to 1.5%. The revision in outlook has been on the assumption that the fiscal consolidation being adopted by several economies, though required, is expected to weigh down demand and in turn growth. Along with this, the fund assumes that banking system of several economies are still very weak, and the low growth is being expected to further tighten the liquidity scenario.

• Bank of Spain reported that the economy kept falling at a “significant pace” in the third quarter, and the government announced its fifth austerity package in what may be a move to head off tougher conditions demanded as part of a potential European bailout. The austerity measures to be adopted is expected to impact investor sentiments negatively among Euro-region after Spain was downgraded to BBB- by S&P, as it expects the harsh austerity measures to result in further political disparity between its Central and regional government which could aggravate instability in the economy.

• Gold declined by USD 37.25 per ounce to close at USD 1736.25 per ounce during the month, on the expectation that China would not require more stimulus measures as its exports grew more than expected. Crude declined almost USD 1 per barrel to close at USD 115.80 per barrel during the period on the expectation that the demand of energy would reduce on account reduced economic activity.

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M F P O I N T E RIssue - 83

October, 2012

For Private Circulation only

Global Indices

Benchmark Closing 14-Sep-12

to 15-Oct-12

Bovespa 59,602 -4.03

CAC 40 3,420 -4.50

DAX 7,261 -2.04

Dow Jones 13,424 -1.24

FTSE 100 5,806 -1.86

Hang Seng 21,148 2.51

Nikkei 225 8,578 -6.35

Shanghai Composite 2,099 -1.18

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Domestic Indices:

• SENSEX and NIFTY for the month ended 15th October 2012, ended higher gaining 1.35% and 1.96% respectively. Gains can be attributed to the increased FII investments into Indian equities, coupled with stronger results posted by some of the industry major in the on-going result season.

• The Government cleared proposals to increase FDI limit in the insurance and pension sectors to 49% with the intention to bring about more reforms which could boost investor sentiments. This was followed by the Dr.Shome panel's report which recommended for indirect transfers to be taxed on prospective basis instead of retrospective taxation as being followed at present for transaction done overseas.

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• FII's continued to the drive the market by being net buyers during the period to the extent of ̀ 27,642cr. Mutual Funds were net sellers in the market to the extent of 4,510cr.

• Rupee continued to strengthen against dollar on the back of increased FII inflows into the system; however dollar demand from Oil importers continues to exert pressure on the dollar recovery. Rupee closed at 53.02 against a dollar as on 15th October 2012, as compared to 54.31 a month earlier.

Bond Market

• Yields on the 10-year benchmark paper closed marginally lower by 1 basis point at 8.17% as on 15th October 2012.

• Relatively comfortable liquidity position continues to prevail in the system and the outcome of RBI policy Review scheduled for 30th October 2012 shall give some indication, though most market players expects adoption of no-rate change stance from RBI.

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Top 5/Bottom 5

Equity Schemes

Top Performers Under Performers

Absolute Absolute Scheme Name Return(%)* Scheme Name Return(%)*

Escorts Growth 11.78 DSPBR World Mining Fund -9.34

Taurus Discovery Fund 11.34 DSPBR World Energy Fund -8.92

HSBC Small Cap Fund 11.08 Franklin Infotech Fund -8.28

Escorts Power & Energy Fund 10.85 PineBridge World Gold Fund -7.38

HSBC Progressive Themes Fund 10.76 ING Global Commodities Fund -6.95

Debt Schemes

Top Performers Under Performers

Annualised AnnualisedScheme Name Return(%)* Scheme Name Return(%)*

ING Income Gth Multi FoF-30%-A 24.33 Tata FIPF A1-Reg 5.36

FT India Life Stage FOFs-40 23.20 Morgan Stanley Active Bond 5.59

ICICI Pru Income Oppr Fund 22.99 Taurus Gilt 5.64

HDFC Medium Term Oppr Fund 20.35 ICICI Pru Medium Term Plan 5.73

IDFC Asset Alloc-Mod-A 18.63 Religare Gilt Long Duration Plan 5.93

*Returns as on 15th Oct-2012

Category Returns : For the month ended 15th October 2012, Banking sector funds gained the most, posting 9.19% followed by 6.29% by Infrastructure Funds. The impact of strengthening of Rupee against dollar has started to be witnessed in the funds with exposure into global equities with this category of schemes (FOF-overseas & Equity-Global) declining by 5.42% and 1.18%. Gold Funds also declined by 3.76% during the period on the back of decline in the global gold prices coupled with strengthening of Rupee.

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*Returns as on 15th Oct 2012

If you are in your 40s, you are more experienced and shouldering several responsibilities. You have had some time to build your career, and would be more stable both financially as well as on your family front. This is a very crucial stage wherein there is a high probability of home loans outstanding and your children just entering their teens and you need to plan for the cost of their higher education as well as managing finances becomes extremely important. This is also a stage where your aspirations like buying cars, vacations, classy attires are at its peak. A time when you relook on all those hobbies you wanted to chase. To sum up a stage when your income would be high but so would be your expenses. This makes it more important to think about initiating towards providing for your retirement so that you can maintain the current lifestyle even after you retire.

Through this issue, we would like to highlight on some of the steps you should consider towards providing for your retirement:

1. Identify your Income & Saving streams: The first step towards any self financial planning exercise is to know your Income / saving sources very well. Income sources would give you an idea of how much you have while saving sources tells you how much you can stretch yourself. This step would highlight some of the expenses that can be done away with. Here you need to consider all possible expenses that may have to be incurred by the time you retire like higher education of children, children's marriage, etc.

2. Pay-off high interest payments: High interest payments over longer tenure are more of an unnecessary baggage on your finances. Gauge what would be cheaper, continuing to pay at high interest rates or paying it off using the existing savings. Once such debts are paid off, the surplus left towards saving would also be more, which can be diverted towards your retirement funding.

3. Enhance your Insurance coverage – Medical & Term Plans: Do not be solely dependent on the employer-sponsored Insurance Policies, as these won't come handy especially when you are switching jobs and may not be adequate enough. There are two more reasons as to why you should consider to buy both medical and term insurance now, first one is the cost of insurance increases substantially in the late 40's and second is that if you have one, it enables in preserving wealth during times of exigencies. So try to achieve the highest point in terms of risk covers.

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Living Retirement Kingsize – Investing @ 40'sLiving Retirement Kingsize – Investing @ 40's

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4. Go Simple: Contribute towards your Provident Fund Account to the fullest, as it is a good way to build a nest egg. The best thing about this option is that you cannot avoid it as it is more of forced saving that becomes the default retirement plan for many individuals.

Post this contribution; invest the remaining into long term asset building options with combinations based on how near is the target “Retirement” that is to be achieved. According to us, an individual in age group between 40-45 your portfolio combination should be more oriented towards large cap Funds/stocks. Though this is not an exact composition, it can undergo a change based on individual risk bearing capacity.

Age Ideal Combinations

20-25 90% Equity 10% Debt

25-40 80-90% Equity 20-10% Debt

40-45 100% Large Cap

45-50 100% Equity - Oriented Balanced Fund

50-60 100% Debt - Oriented Balanced Fund

Post 60 100% into Monthly Income Plan with Dividend option

5. Don't dip into corpus before you retire: Do not consider your retirement corpus to be some kind of contingency fund from where you would dig out to fund your current expenses during times of financial tightness and should be considered as a last straw. Never exercise the option to withdraw your PF balance while changing jobs, instead transfer it to the account with the new employer. Dipping into the corpus before you retire prevents your money to gain from the power of compounding. Don't underestimate what this can do to your retirement savings over the long term.

To conclude, being disciplined and prudent towards providing for your retirement can be the only thing that can enable you retire rich and more importantly being independent.

Know Your Report

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Table 1 - Portfolio Summary - This report shows summary of all schemes in which investment is being held.

Column header and descriptions:

1. Name of Scheme: Name of the schemes in which investment is made.

2. Folio Number: This is unique number allotted by AMC to an investor for identify their investment.

3. Unit Balance: Shows total available units in the scheme.

4. Current Value (INR): Present value of investment as per the NAV on the last business day.

5. Purchase Cost: Total invested amount in the scheme.

6. Dividend Reinvestment: Represents reinvestment of dividends paid by purchasing additional units.

7. Dividend Payout: Dividend payout refers dividend paid to the investor when declared by AMC.

8. Profit/Loss: Shows any gain/loss on the investment at current value (excludes any dividend income received).

9. Weighted Average days: This field shows the average holding period of the portfolio as per the amount being invested on various days.

10. Absolute Return (%): It is the percentage return between the present values of the investment over the amount invested. This is calculated only for those investments which have completed less than one year since investment.

11. Annual Return (%): Annual return is the increase in value of an investment, expressed as a percentage per year.

12. C.A.G.R (%): C.A.G.R is a year-over-year growth rate of an investment over the invested period.

13. XIRR (%): The XIRR function is used to determine the returns when the payment and income are made at different periods.

Table 1

In this issue we are covering Portfolio summary, Dividend Detail and SIP Summary Report. Portfolio summary report, as the name implies, provides a snapshot of all investments being held as on a date. Dividend Report provides status of returns made by way of dividends from the investments made while SIP summary summaries investments made by way of SIPs with the latest valuations.

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14. Net Gain (INR): Represents overall benefits derived from the investment (includes Dividend income already received earlier).

Table 2

Table 2 -Dividend Detail Report- This report shows details of all dividends received from an investment. It also indicates whether such dividend was paid out or has been re-invested into the scheme.

Column header and descriptions:

1. Scheme name: Name of the schemes in which dividend declared.

2. Transaction Date: Transaction date refers Dividend declaration date.

3. Dividend Nature: Shows nature of dividend means it may be Dividend payout or Dividend reinvestment.

4. Amount (INR): Amount refers Dividend received amount.

Table 3

Table 3 – SIP Summary – This snapshot contains a summary of various mutual fund investments in the portfolio with the latest valuations. Column headers other than those appearing in the reports mentioned above is being described hereunder:

1. SIP Amount: It shows SIP amount.

2. Frequency: Frequency refers investment made at a regular interval.

3. Start Date: Shows SIP started date.

4. End Date: Shows SIP maturity date.

5. Amount Invested: Total invested amount in the scheme by way of SIPs.

6. Total units: Shows total available units in the scheme.

7. Average Purchase Price (INR): Average purchase price is determined by dividing the total invested by the number of SIP installments.

8. Dividend Amount: Dividend paid to the investor when declared by AMC on SIP transactions.

9. Current NAV (INR): Shows value of NAV as per last business day.

10. Market Value (INR): Shows value of investment as per last business day.

Corporate Office Address : Website :

A1, Kailash Industrial Complex, Park Site, Off LBS Marg, Vikhroli West, Mumbai - 400 079. Tel: +91-22-6754 7000 • E mail : mutualfunds@ventura1.com • www.ventura1.com

This document is solely for private circulation only. Mutual funds like securities investments are subject to market risks and other risks. Investors are advised to read the offer document before investing.

Performing Mutual Fund Plans

Scheme Name Corpus NAV (`) Annualised %

( Crs)# Gr Div 1 mth 3 mths 6 mths 1 yr

Income Funds

Birla SL Dynamic Bond Fund 12,125 19.09 10.60

HDFC High Interest-STP 2,067 22.32 10.60

Ultra Short Term Plan

HDFC Cash Mgmt -TA Plan 16,536 24.27 10.10

Reliance Money Manager 10,671 1,517.29 1,014.14

Tata Floater 3,278 1,690.30 1,072.42

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14.58 12.34 11.13 11.32

15.16 12.11 10.87 10.47

7.94 8.15 8.56 9.05

8.24 8.58 9.19 9.38

8.78 9.01 9.57 9.77

*Returns for less than 1 year is absolute (in case of MIP, it is annualized) and more than 1 year are compounded annualized as on 15th Oct 2012. #Corpus as on September 2012 as AMFI has mandated for quarterly AUM declaration.

Scheme Name* Corpus NAV (`) 6 mths 1 yr 3 yrs 5 yrs

(` Crs)# Gr Div (%) (%) (%) (%)

Hybrid - Monthly Income Plans(MIPs)Birla SL MIP II-Savings 5 310 20.29 11.77DSPBR MIP 335 22.19 11.44Balanced FundHDFC Prudence Fund 6,224 229.81 27.57Equity - Large CapDSPBR Top 100 Equity Fund 3,535 104.50 21.01Franklin India Bluechip Fund 5,013 222.82 36.66HDFC Top 200 Fund 12,101 215.77 42.35ICICI Pru Dynamic Plan 4,056 110.87 18.16ICICI Pru Focused Blue Chip Equity 4,025 17.49 16.69 -Equity - Multi capBirla SL Dividend Yield Plus 1,280 90.49 13.02HDFC Equity Fund 10,316 278.96 42.83IDFC Premier Equity Fund-A 3,071 36.72 24.19Reliance Equity Opportunities Fund 3,830 41.51 25.13UTI Dividend Yield Fund 3,755 33.43 13.92Equity - MidcapDSPBR Small & Mid Cap Fund 1,225 18.50 14.42HDFC Mid-Cap Opportunities Fund 2,466 17.79 16.13ICICI Pru Discovery Fund 1,985 53.91 20.57SBI Magnum Emerging Businesses 734 53.67 17.31Sundaram Select Midcap 2,069 164.09 18.56Equity - ThematicHDFC Infrastructure Fund 683 10.68 10.68Reliance Banking Fund 1,729 107.29 38.93Reliance Pharma Fund 635 66.20 44.81Tax Saving Scheme(ELSS)Fidelity Tax Advt Fund N.A 22.55 17.65HDFC TaxSaver 3,413 232.63 52.86ICICI Pru Tax Plan 1,363 148.55 18.87Sensex 18,713.55Nifty 5,687.25

10.91 11.17 7.86 10.569.52 13.78 7.68 7.57

7.53 12.23 11.49 10.35

5.43 12.18 5.99 4.826.60 9.23 7.96 4.488.75 12.33 6.80 7.416.28 12.07 9.50 6.249.31 11.83 10.16

6.84 10.89 10.25 11.828.20 11.61 8.10 7.33

10.18 13.25 14.73 12.2313.35 21.46 16.64 9.287.56 7.77 8.94 7.82

8.22 10.39 11.45 6.938.60 16.68 16.00 9.78

10.77 23.39 13.42 12.0016.27 23.35 21.01 5.8913.89 16.24 9.36 6.36

4.00 6.9312.83 19.15 11.42 14.4713.99 20.92 21.70 20.94

7.80 8.94 8.77 5.586.26 9.70 7.98 4.35

11.14 13.38 10.85 7.219.47 9.55 2.869.21 10.82 3.64 0.06

-1.02

-0.36

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