Page 3 - Sarbajeet K Sen

Gold scaling new peaks: Book profit if weight in portfolio exceeds 15%

Geopolitical tensions and fears of trade wars due to anticipated US tariff announcements are the key drivers of gold prices

Consumption funds: Budget boost and young spenders to drive theme

The Budget's tax cuts, with an estimated revenue foregone of Rs 1 lakh crore, are expected to improve sentiment and have a multiplier effect on consumer demand

More disposable income in hands: TDS threshold for senior citizens doubled

Taxpayers can now file updated returns for four years instead of the previous two

BAF: A refuge from volatility for new and risk-averse investors

BAFs provide an asset allocation tool for investors that are relatively hassle-free and help investors deal with market gyrations better through relatively emotionless investing

Amid market volatility, strengthen portfolio resilience with largecap funds

Largecap companies are generally less vulnerable to economic slowdowns than their mid- and smallcap counterparts

Aggressive hybrid funds: Cope with mkt volatility, benefit from rate cuts

If interest rates decline, the bond component of these portfolios could generate capital gains. Conversely, rising interest rates may cause short-term losses

Fixed income outlook 2025: Lock into peak rates as cuts are likely

The much-anticipated interest rate cut cycle may be delayed, but experts believe the Reserve Bank of India (RBI) will reduce rates in 2025

Wait for NAV and price on exchange to converge before investing

Indian fund houses have cumulatively hit the investment ceiling set by the Reserve Bank of India (RBI): $7 billion for overseas mutual fund (MF) investments

Reducing home loan: Switch to lower-cost loan if credit profile improves

Until repo rate cuts begin, borrowers can explore other options to lower their home loan burden

Consumption funds: Strong returns await investors who can endure slowdowns

Over the past year, consumption funds yielded returns of 28.6 per cent, lower than PSU (46.4 per cent), pharma (42 per cent), infrastructure (39.1 per cent), and technology (37.8 per cent)

LDFs: Suitable for long-term investors with higher risk appetite

LDFs carry significant interest rate risks. Rapid rate increases could result in MTM losses

Investing in ETFs: Ensure low tracking error, alignment with risk appetite

Investors should approach ETFs as long-term investments and avoid frequent trading

Liquid funds: Go for fund with large AUM, high credit quality and low cost

These funds invest in money market instruments maturing in less than 91 days, including treasury bills, commercial papers issued by corporates, and certificates of deposits issued by banks

Pharma and health care funds: Defensive bets amid growing volatility

Altogether, 26 funds focused on pharma and healthcare collectively manage Rs 30,306 crore. Some of them offer exposure to global pharma stocks

For exposure to stable and resilient businesses, bet on MNC funds

MNC funds invest in companies where foreign promoters have more than 50% shareholding

Mitigate accounting, disclosure and governance risks with ESG funds

Globally, regulators, rating agencies, and institutional investors have led the charge in promoting ESG investing

Passive value funds are for investors who can face deep drawdowns

Opt for passive funds to reduce fund manager risk and capitalise on their lower costs

Lock into attractive SCSS, FD returns before interest rate cuts begin

Investors with a longer time frame will be better off investing in longer-tenured FDs

Retirement funds: Align equity-debt mix with risk appetite and horizon

Their risk-return profiles can vary widely. Equity-focused schemes may perform better in a bull market, while debt-oriented ones may offer greater stability during volatile periods

Flexi-cap funds: Smart choice amid high valuations, potential volatility

Flexi-cap funds invest across market caps without fixed allocation limits