M. Pattabiraman's Blog, page 127

Sensex ETFs vs Nifty ETFs – Which is better for investing?

A reader asks, “Sir, can we use Sensex or Nifty ETFs for long term goals instead of index funds? If so, which is better, Sensex or Nifty ETFs?” We recommend not using any ETF for investing because of possible price-NAV swings during times of crisis and their persistence for weeks. This can happen in any ETF...

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Can we achieve financial independence in 13 years starting from scratch?

A reader asks, “Sir, My wife and I are both working in the same company and do wish to have children. We are both aged 27. We have just started working in well-paid jobs, so our networth is essentially zero. Our dream is to put an end to salaried existence in at least 13 years’...

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Index fund tracking error screener August 2022

This is an index fund screener based on tracking error and returns difference wrt benchmarks (aka tracking difference). The screener will help a user evaluate how efficiently an index fund has tracked its underlying benchmark. It will also help a understand how tracking a midcap index or the Nifty 100, 500 is quite different from...

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Fourteen Years of Mutual Fund Investing: My Journey and lessons learned

On 19th June 2008, I started investing in mutual funds. These 14 years have changed my view of risk and day-to-day money management. This is my story and the lessons I have learned. The broad trajectory should be well known to regular/old readers. This is an account of how I went from spendthrift to debt-bearer...

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Will PPF and SSY eligibility also be modified like Atal Pension Yojana to exclude income-tax payers?

On the 10th of August 2022, the Ministry of Finance announced, ” any citizen who is or has been an income-tax payer, shall not be eligible to join APY from 1st October 2022″. Further, “In case a subscriber, who joined on or after 1st October 2022, is subsequently found to have been an income-tax payer...

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A screener to select mutual funds with lower risk & higher return

Here is a simple way to select mutual funds that have beat the category benchmark in terms of both return and risk over the last one, two, three, four and five years simultaneously! That is higher than the benchmark return and lower than the benchmark risk. This option is available in our monthly MF fund...

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ETF tracking error screener Aug 2022

This is an ETF screener based on tracking errors and tracking differences (ETF return minus index return). The screener will help a user evaluate how efficiently an ETF has tracked its underlying benchmark. The tracking error is simply the ETF’s standard deviation minus index monthly return differences. The lower the tracking error, the more efficient...

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Can I use ultra short duration funds instead for short-term goals?

A reader asks, “You usually recommend money market funds for short-term goals. Can we also consider Ultra Short Duration Funds for this purpose?’ The definition of money market funds is simple: “Investment in Money Market instruments having maturity up to 1 year”.Ultra-short duration funds are defined as “investment in Debt & Money Market instruments such...

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Conventional ETF tracking errors can be misleading here is how to correct them

In this article, we explain why conventional ways of measuring ETF tracking errors can be misleading and present an alternative. The efficiency of a passive fund (index fund or ETF) is measured by the tracking error or tracking difference. The tracking difference is simply the fund return minus benchmark return. This must be a small...

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Axis Nifty 100 Index Fund Performance Report

Axis Nifty 100 Index Fund is an open-ended index that aims to achieve a return close to Nifty 100 subject to tracking error.  The Fund was launched in Oct 2019 and currently has an AUM of about 760 Crores. When the fund launched, we reviewed the underlying index in detail and mentioned that we needed...

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