Start Samvat 2078 With A Bang

Diwali brings with it loads of enthusiasm and a strong positive feeling. This extends to your finances too. And even though last year’s Diwali turned out to be depressing on account of the pandemic, here is how you can look forward to brighter days with good financial planning and the right choice of equity and debt funds

There are four key virtues that the festival of Diwali in India symbolises: a) victory of good over evil, b) illuminating one’s inner self, c) knowledge and d) financial prosperity. As evident, the festival of lights was quite different last year and it is not that hard to guess the reason. Last year the economy, and consequently the equity market, was overturned by the impact of the pandemic. All of a sudden, the world seemed to have turned upside down with fatalities increasing by the day, unemployment numbers starting to zoom up and health concerns taking precedence over everything else. Diwali, as such, turned out to be a dark one.

However, in any critical situation as this one, proper planning and discipline with a little patience can help you appreciate the true essence of Diwali and enhance your personal finances for a better tomorrow. The equity market has been rewarding to those investors who had patiently invested in a disciplined way during the fall. From last Samvat till date, Nifty 50 Total Returns Index (TRI) has surged close to 42 per cent whereas Nifty Mid-Cap 100 TRI and Nifty Small-Cap 100 TRI have ascended nearly 68 per cent and 81 per cent, respectively.

The graph above clearly shows that those who had invested in the previous Samvat have been rewarded quite handsomely (index values are re-based at 100). In fact, those who were overweight on small-cap stocks or funds dedicated to small-cap stocks would have almost doubled their wealth in the matter of just one year. That said, investors should always diversify their investments. This helps them reduce unnecessary risk. Let us now see the returns that you would have generated if you had invested from Diwali to Diwali.