Why Investment is Important ?

1
Why Investment Is Necessary At Early Stage.

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• Finance Planning
• Wealth Management
• Portfolio Management Services
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2
What is the Average Age when one starts Earning?
25 Years
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3
What is the Average Retirement Age?
60 Years
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4
What is an Average Income of an Middle-Class
House-hold?
Rs.15,000/- p.m.
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5
How much can a person save on a regular basis?
Rs.5,000/- p.m.
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6
If a person can save Rs.5,000/- per month What
will be his wealth when he retires?
Assuming He increases his investments by 5
every year Invests in an Asset class that gives
returns of 20
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7
At Age 60 his wealth would have been
Rs.27 Crores
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8
Start Early
  Ram Shyam
Savings Starting Age 25 40
Savings - Monthly SIP Rs.5,000/- Rs.15,000/-
Saving Years till age 60 35 years 20 years
Total Amount Saved (appx.) Rs.57 lacs Rs.62 lacs
Give time to your investments
rather than timing
Give time to your investments
rather than timing
Assumptions (a) Savings grows at 5 annually (b)
Returns assumed at 20 CAGR
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Invest Regularly

• Builds wealth over the long term
• Just Rs. 1500 per month invested for 17 years
  _at_10 would grow to approx Rs. 8 lakhscould be
  used for your daughters marriage
• Take advantage of market volatility
• Buy more when the markets are down

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10
Invest Regularly

• It is the small drops that make an ocean!!
• Relieves you of the last minute pressure
• Slow and steady wins the race
• E.g. Split your Sec 80C investments into smaller
  amounts and invest every month
• Reduces the risk of investing at the wrong time
• Difficult to predict the market and know when is
  the right time
• We earn regularly We spend regularly
• Shouldnt we also invest regularly?

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11
Invest Regularly

• .It all adds up!

Rs. 22.6 lakhs
Rs.1000 invested every month for 30 years _at_10
30
A small amount invested regularly can grow to
substantial lumpsum AP(1i)n-1/i(1i)
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Earn More

• Earn moreit can make a big difference

One time investment of Rs.1 lakh invested for 30
yrs
_at_ 6
_at_ 10
_at_ 15
5.7 lakhs
17.45 lakhs
66.2 lakhs
A P(1r)n
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POWER OF COMPOUNDING - QUIZ
Earn More

• Rs. 10,000 invested every month for a period of
  30 years
• At 8 -
• At 15 -
• At 20 -

1.5 crores
5.6 crores
15.5 crores
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The Formula for Creating Wealth
Earn More
Make your money work hard for you
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15
NEED FOR FINANCIAL PLANNING

• One of the most common reasons cited for not
  doing proper financial planning is if I continue
  to earn as much as I do now, what is the big
  problem? And always my salary will only increase
  with experience and hence I will always have
  enough money at hand for unexpected expenses and
  regular living expenses.
• The objective of financial planning is to ensure
  that the right money is available to the investor
  at the right time to enable him to meet the
  different goals in his life.

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NEED FOR FINANCIAL PLANNING (contd..)

• Examples
• Saving to buy a car costing around Rs 3,50,000
  after 3 years.
• Investing for higher education of children where
  money is required after 10 and 12 years.
• Planning for retirement to meet expenses for 25
  years after retirement.
• Investing to save taxes in an efficient manner.
• Passing on wealth to the next generation (estate
  planning) etc

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17
OBJECTIVES OF PERSONAL FINANCIAL PLANNING
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18
THE MILLION DOLLAR QUESTION
I am convinced that I should save and invest
regularly, but the million dollar question
is Where should I invest?
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19
A PERSONAL PLAN FOR INVESTING

1. Establish realistic goals
2. Determine the amount of money needed to meet your
   goals
3. Specify the amount of money available to fund
   your investments
4. List different investments you want to evaluate
5. Evaluate risk and potential return for each
6. Reduce possible investments to a reasonable
   number
7. Choose at least two different investments
8. Continue to evaluate your investment program

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20
INVESTMENT AVENUES
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RISK-RETURN TRADEOFF OF VARIOUS INVESTMENT AVENUES
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22
SAFETY AND RISK

• The Risk-Return Trade-Off
• Choosing higher risk investments, investors
  expect higher returns

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23
When Diversification Works

• Must combine stocks that are not perfectly
  positively correlated with each other to reduce
  variance.
• The greater the negative correlation between two
  stocks, the greater the reduction in risk
  achieved by investing in both stocks
• The combination of these stocks reduces the range
  of potential outcomes compared to 100 investment
  in a single stock.
• It may be possible to reduce risk without
  reducing potential return.

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24
Adding More Stocks to the Portfolio Systematic
and Unsystematic Risk

• Total risk is made up of two parts
• Unsystematic or Diversifiable risk and
• Systematic or Non-diversifiable risk.
• Unsystematic risk, Company specific risk,
  Diversifiable Risk
•   product or labor problems.
• Systematic risk, Market risk, Non-diversifiable
  Risk
• recession or inflation
• Well-diversified portfolio -- one whose
  unsystematic risk has been completely eliminated.
  
• Large mutual fund companies.

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Adding More Stocks To The Portfolio Systematic
And Unsystematic Risk
As the number of stocks in a portfolio approaches
around 25, almost all of the unsystematic risk is
eliminated, leaving behind only systematic risk.
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26
Portfolio Management Process

• Specification of investment objective and
  constraints
• Choice of asset mix
• Formulation of portfolio strategy
• Selection of securities
• Portfolio execution
• Portfolio revision
• Portfolio evaluation

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27
Area of Knowledge required by Financial Planner

• Developing personal financial statements and
  budgeting
• Investment decisions and strategies
• Retirement Planning
• Insurance
• Taxes and their implications on personal
  financial decision
• Estate Planning
• Knowledge of Law, Standards Code of Ethics

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28
Warren Buffett Investment Principles

• Look for the absence of change. Look for the
  business whose only change in the future will be
  doing more business.
• Its far better to buy a wonderful company at a
  fair price rather than buying a fair company at a
  wonderful price.
• Be fearful when others are greedy and greedy only
  when others are fearful.
• If someone tells you they have a foolproof
  method to get rich in the stock market, run,
  dont walk, for the nearest exit.

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29
Warren Buffett Investment Principles (contd..)

• View stocks as businesses, not pieces of paper.
• There are times when doing nothing is a sign of
  investing brilliance.
• Take a close look at management.
• Read, Read some more and then Think.
• A few good investments are all that is needed.
• Know the value of something rather than the price
  of everything.

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30
Using The Wisdom
We can direct our savings in such a manner that
we create wealth, the way we wish
DISCIPLINED SAVINGS SUFFICIENT TIME RIGHT
ASSET CLASS Smart Investors Preference
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31
Why Elite Wealth
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Make Smart Decisions About Your Money
One Point of Contact for all Financial Matters
Become Your Financial Ally Coordinating all
aspects of your financial infrastructure
Help you to align your values and finances in
pursuit of your stated goals, whatever they might
be!
Provide Integrated Investment, i.e. Retirement,
Tax, Insurance, Wealth Accumulation Advice
Specialized Financial Service
Elite Wealth Advisors Ltd Make Your Money Work
For You
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We enjoy a trusted relationship with our clients
because we give them honest appropriate advice.
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Elite Wealth Advisors Ltd Make Your Money Work
For You
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CONTACT US
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• Registered OfficeS-110, Sahara Mall,
  M.G.RoadHaryana-122002Ph 0124-4068107
• Corporate Office
• S-8, DDA Shopping Complex,
• Near Jeevan Anmol Hospital,
• Mayur Vihar Phase-1, Delhi-110091.
• Ph 22758145, 22758165,22755894,2275589
  6,
• 43035555(90 Lines)
• Fax [phone] Visit
  www.elitewealth.inE-mail info_at_elitewealth.in
• Branch Sarita Vihar
• B-104,LOCAL SHOPPING COMPLEX
  SARITA VIHAR , DELHI-110044,
  Ph-26972552/57,41000784
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• 604,TRADEX TOWER-1,3-B,ALPHA
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  -201306Ph-0120-2321156, 2326851/52, 2321149
  Fax-4298286

Elite Wealth Advisors Ltd Make Your Money Work
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Thank You Call us -011-40000919
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Elite Wealth Advisors Ltd Make Your Money Work
For You