Investing in Index ETF

Index Funds (Index Funds vs ETF)

  1. Large Cap :                                                                                                                                                                                                (i) Nifty Next 50 Fund                                                            (ii) Nifty 50 NV20 ETF
  2. Mid Cap :                                                                                                                                                                                               Motilal Oswal Fund
  3. Small Cap :                                                                                                                                                                                              No funds right now.
  4. Multi-Cap Funds : No funds right now. So, Index funds for 2, 3 and 4 are a complete no. Only invest in 1 only.

Rolling Returns For MFs

CAGR vs Absolute vs Trailing vs Calendar Returns -> Different Type of Returns

1)Absolute Returns : Returns generated between 2 points.

2)CAGR: On Annual basis.

3)Trailing(will go backwards) : 1,3,5,10 years, etc…

4)Calendar: 1st Jan to 31st Dec

Rolling Returns :- A type of annualized returns.

CAGR = [{(Value of at the end of tenure(2010)/Value at the beginning(2003)) raised to power of (1/no of years)} – 1]

Rolling Return over 7 years from 2003 to 2010.

Rolling returns for 3 years rolled every year.

7+3 years = 10 years, so in the span of 10 years rolling returns occurs.

Some salient features of Rolling Returna are:-

1.Time Consuming & needs lot of data.

2. Some MF Websites, some analysts websites (such as Karvy) provides the uses of rolling returns.

2.i) Gives better picture of fund’s consistency.

2.ii) Suitable for short term’s funds, liquid funds.