Future bright for mutual funds in the long term
After he became that person in office with whom his colleagues discussed their doubts around investments, R K Mohapatra took a decision. He made up his mind to pen down his knowledge in series of books. Mohapatra has authored two books, ‘Retirement Planning: A simple guide for Individuals’ and ‘Investment Risk & Growth: A guide for Investors about Investment Vehicles’. Yet another book will also be published soon.
Speaking to The Free Press Journal, Mohapatra said, “My first book was published in 2013. I started writing a book with an intension of trying something different.” This professional who has been in the field of finance in India and abroad for 25 years, believes the main driver for this decision was the work stress. He wanted a stressbuster and to achieve that he took to writing books.
Writing books has not stopped him from advising his colleagues’ investment dilemma and he still enjoys it to the fullest. Talking about the ‘typical investment options’ that dominate the Indian minds—gold and fixed deposits, he said, “Till date many depend on gold and fixed deposits for returns. I continue advising them that gold should be purchased as per ones requirement and not as an investment or in excess. On the other hand, fixed deposits have limited scope of return as you have to pay taxes on it as well.”
If you ask him where one should invest, then his reply is straight forward— opt for Mutual Funds (MF). “For a first time MF investor, I would recommend they go for blue chip companies and have a diversified approach. Most of the first-time investors look for returns (with low or medium risk.),” Mohapatra said. He has tried to cover such queries around MF in his books. Mohapatra, who is the joint general manager of finance at IRCON International, does not feel it’s a task for him to author books, journals and articles on MF. “It is like a part of my any other activity,” he added. Both his books are below 200 pages, he likes keeping it crisp as it targets first-time investors.
Over a conversation with him, he reaches a point where he talks about the risk factor in MF— high, medium and low. He believes risk does play a role in MF investment. But he feels age, duration and goal are critical as these elements help the first time investor pick a MF based on their needs.
Keeping in mind the investors who opt for multiple MF, he said, “In that case, one should invest with three-four fund houses.”
In the long term, MF will grow further and provide more returns, claims Mohapatra. According to him, as this investment option is taxfree one can see growth. He added that Goods and Services Tax (GST) in a long term will benefit the growth and GDP. “This growth would reflect in our equity market too,” he added. He also believes the growth will be stunned for the mutual fund industry at least for the first three months of GST. In the short term, he considers a negative impact in the share market but he believes equity will overcome all those hurdles.