|As the saying goes, “Rome was not built in a day”. Same way, there is no shortcut to Wealth Creation.|
|It reminds us of an investor Ramesh, who started his investment journey in April 2005 through his Financial advisor Mr. Ravi. Ramesh took his first step with a monthly SIP of 5,000 into Reliance Multi Cap Fund with a view to create wealth. By the end of 2006, he saw his money grow significantly to Rs. 1.60 lakhs over an investment of Rs. 1.05 lakhs.
Based on his recent experience, he decided to start his 2nd SIP of Rs. 5,000 in Reliance Multi Cap Fund in Jan 2007. His value of investments grew for the first 22 months but suddenly the markets corrected sharply as a fallout of Global financial crisis and his portfolio value declined to Rs. 2.30 lakhs over an investment of Rs. 3.25 lakhs. He got worried and was thinking of redeeming his investments as his portfolio value declined substantially. However, his investment advisor Mr. Ravi advised him to continue with his regular investments. He convinced him that SIP is a long-term wealth creation tool and each market correction is rather a good opportunity to further bring down the cost of investments by averaging through buying more units during such times. As guided by Mr. Ravi, Ramesh continued his SIPs without getting worried by the short-term volatility. This helped him grow his wealth systematically over a period of time.
In Jan 2011, when the markets started declining from their peak, Ramesh recalled Mr. Ravi’s advice and took this as another opportunity to start his 3rd SIP. He invested another Rs. 5,000 per month in Reliance Multi Cap Fund with a long-term perspective having learnt from his past experiences.
By Dec 2018, Ramesh’s:
Excerpt from Reliance Mutual Fund e-letter; Past performance is not an indicator for future returns. Mutual fund investments are subject to market risks – please read the offer document before investing.