Corrections Do Pay Off

An entrepreneur meets her long-term financial goals by trusting the financial advisor to guide her through the market volatility and invest in the right funds

Gunjan Agarwal is an entrepreneur running a food parlour. Her world revolves around her two children. Her main aim is the well-being of the children, their education, marriage, and lead a happy life during the golden years of her life. She would invest all her money in traditional products till she met Anil Jhanwar from Invest Search in 2010. After a few rounds of discussions, Jhanwar understood her aspirations and chalked out a sincere financial plan.

Since Agarwal was not exposed to the equity markets, Jhanwar did not insist her on investing a lump sum there. Instead, Systematic Investment Plans (SIPs) were registered. Her first SIP was started with ₹10,000 every month. Since her financial goals were for the long term, the focus was on wealth creation through equity-oriented funds. However, Jhanwar also acknowledged the need for a balanced approach towards investing, and the monthly investments were partially diverted towards hybrid funds. This assumed importance for her. A pleasant investment experience helped in strengthening her confidence in the markets. A bad experience with the loss of investment capital would not have been desirable.

As luck would have it, the markets remained range-bound for the next three years, resulting in negligible returns of only 3-4 per cent per annum. This made Agarwal a little impatient with her investments in mutual funds. She considered her traditional investment strategy better with sound returns at a lower risk.