Rs.1 lakh invested in Franklin India Bluechip Fund in December 1993 is worth Rs.83.17 lakhs in September 2015. Money multiplied by 87 times in 21+ years. This works out an annualised return of 22.43%.
Rs.1 lakh invested in HDFC Tax Saver in March 1996 is worth Rs.94.32 lakhs in September 2015. Money multiplied by 94 times in 19+ years. This works out an annualised return of 26.24%.
These are facts, not fiction.
In India, diversified equity funds (non sectoral, non thematic) have done very well over last 2 decades.
CRISIL AMFI Equity Fund Performance index has provided an annualised return of 22.74% over last 18+ years.
As pointed out in our previous posts, only around 2% of investors stay beyond 10 years in an equity fund. These are the people who enjoy the above kind of returns.
We would be completing 15 years in our profession next year. We have many investors who have been staying invested for 10 years, 8 years etc. In next 5 years, many of our investors would have held to their portfolio for 15 years or more.
I’m happy that you would all see power of compounding in your portfolio in next few years. Many are seeing even now and are happy with their decision.
Whatever we do; all our activities, interactions, meetings, tweets, blogs etc. are to reinforce and ensure that you stay the course. My goal is each one of you should be able to see for yourself, in your portfolios, the benefits of not churning the portfolio, staying the course without interruption, patience, power of compounding and long term investing.
Though doing nothing and sitting tight may be very boring and difficult, the results of the same would be extremely rewarding.
Think of equity as a multi decades and multi generational investment. You would get returns better than any other asset class. Not only that you would create huge wealth and be financially independent.
If you are not investing long term money into an equity fund, it is a wasted opportunity.
As a country, we have a very long way to go and grow to be economically powerful.
Participate and benefit from the journey by investing in equity funds.