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Quick Reference guide for financial planning July 2012

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					                                                                                                                                        Quick
                                                                                                                                    Reference
                                                                                                                                        Guide
                                                                                                                                             10th July 2012
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The guide gives the returns of asset classes for different periods of time, to be used in your personal financial
planning.

        Indicators:          No change from last month                         Less than last month                   More than last month


                                     Summary of investment return rates
Returns are shown as an annualized %, and are not adjusted for inflation or taxes.

Type of Asset                           10 years                  3 years                                                            1 year
Debt – Savings bank                         -                         -                                                       4.00 to 7.00 % 
Debt – Fixed deposits              8.00 to 9.00 %           8.75 to 9.25 %                                                  7.25 to 9.25 % 
Debt – Mutual funds                    8.04 %                  8.42 %                                                           12.69 % 
Equity – Mutual funds                 23.20 %                  16.07%                                                            2.41 % 
Equity – Nifty                        17.60 %                  10.39 %                                                          -4.82 % 
Gold                                  19.53 %                  26.66 %                                                         32.04 % 
Real estate                      -9.45 % to 30.76 % *       -7.17 % to 36.32 %                                               -16.28 % to 39.35 %
* Real estate returns for 4 years based on NHB Residex data



                                                                Return rates in %
              35                                                                                                                    32.04
              30                                                                              26.66
              25                     23.2
                                                   19.53
              20                            17.6                              16.07
              15                                                                                             12.69
                        9                                      9.25                   10.39           9.25
              10              8.04                                     8.42
               5                                                                                                     2.41
                                                                                                                            -4.82
               0
              -5                 10 years                                  3 years                                1 year
             -10

                      Debt – Fixed deposits          Debt – Mutual funds         Equity – Mutual funds        Equity – Nifty          Gold




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                                                 Debt – Savings Bank
After the savings rate deregulation by the RBI, most of the banks still continue offering 4% on the savings bank
balances. The banks that offer higher savings bank rates are

    1   Yes Bank:                      6 % up to Rs. 1 lac and 7 % above Rs. 1 lac
    2   Kotak Mahindra Bank:           5.5 % up to Rs. 1 lac and 6 % above Rs. 1 lac
    3   Indusind Bank:                 5.5 % up to Rs. 1 lac and 6 % above Rs. 1 lac
    4   Ratnakar Bank:                 5.5 % on any balance amount
    5   Karnataka Bank:                4% up to Rs. 2 lac and 5 % above Rs. 2 lac



                                                Debt – Fixed Deposits
A list of interest rates for fixed deposits of varying durations is presented in the table below.

Bank                               Less than 90 days                1 year                   3 years                    10 years
Axis Bank                             6.50 %                     9.25 %                   9.25 %                    8.75 % 
Bank of Baroda                        4.50 %                     8.75 %                   8.75 %                    8.00 % 
Bank of India                         5.50 %                     9.25 %                   9.00 %                    9.00 % 
Canara Bank                           7.00 %                     9.25 %                   9.00 %                    9.00 % 
Central Bank of India                 7.00 %                   9.00 %                 8.75 %                  8.50 %
HDFC Bank                             7.00 %                     7.25 %                   9.25 %                    8.25 % 
ICICI Bank                            6.50 %                     8.00 %                   9.25 %                    8.50% 
Kotak Mahindra Bank                   7.00 %                   9.25 %                 9.00 %                  9.00 % 
State Bank of India                   8.00 %                   9.00 %                 9.00 %                  9.00 %
Union Bank of India                   6.25 %                     9.25 %                   9.25 %                    8.50 % 
Yes Bank                              6.25 %                     9.00 %                   8.75 %                    8.75 % 
Interest rates are shown for amounts less than Rs. 1 crore. The rates can differ for less than Rs. 15 lacs deposits.

The interest rates on fixed deposits have been stable over the last one month, with a slight downward bias.

Use the table to find out the banks offering the higher interest rates for your fixed deposit investments. This
could be the start of a downward trend in interest rates over a long term. Investors should start preparing for
lower rates on their new fixed deposits in the future. It is recommended that you follow the changing interest
rates for a few more months to get confirmation on the falling interest rates.



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                                               Debt – Mutual funds
NAV : Net asset value in Rupees per unit

The top 5 performing funds over a 10 year period are

S. No.                        Scheme name                             NAV 10 years          NAV current          Annualized %
                                                                        before
   1     Kotak Bond Regular                                              14.32                  31.63             8.24 %    
   2     ICICI Prudential Long-term Reg                                  10.37                  22.87             8.23 %    
   3     Escorts Income                                                  16.55                  35.92             8.05 %    
   4     IDFC Dynamic Bond Plan A                                        10.07                  21.76             8.00 %    
   5     Sahara Income                                                   10.09                  21.15             7.68 %    
                                                                                                   Average        8.04%     


The top 5 performing funds over a 3 year period are

S. No.                         Scheme name                             NAV 3 years          NAV current          Annualized %
                                                                         before
   1     IDFC SSI Medium-term Plan B                                     10.41                  12.09             8.82 %    
   2     SBI Dynamic Bond                                                10.58                  13.55             8.59 %    
   3     Escorts Income                                                  28.15                  35.92             8.46 %    
   4     IDFC SSI Medium-term Plan A                                     14.73                  18.76             8.39 %    
   5     Birla Sun Life Medium Term Retail                               10.22                  12.81             7.85 %    
                                                                                                   Average        8.42 %    


The top 5 performing funds over a 1 year period are

S. No.                         Scheme name                              NAV 1 year          NAV current          Annualized %
                                                                         before
   1     Escorts Income                                                   31.47                 35.92             14.14 %   
   2     Kotak Bond Deposit                                               26.18                 29.50             12.67 %   
   3     Kotak Bond Regular                                               28.07                 31.63             12.67 %   
   4     SBI Dynamic Bond                                                 12.09                 13.55             12.08 %   
   5     IDFC Dynamic Bond Plan B                                         11.50                 12.87             11.87 %   
                                                                                                   Average        12.69 %   




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                                             Equity – Mutual funds
NAV : Net asset value in Rupees per unit

The top 5 performing funds over a 10 year period are

S. No.                         Scheme name                             NAV 10 years         NAV current          Annualized %
                                                                         before
   1     Franklin India Bluechip                                          22.68                213.25             25.10 %   
   2     Kotak 50                                                         11.57                 98.02             23.81 %   
   3     ICICI Prudential Top 200                                         13.05                106.81             23.38 %   
   4     SBI Magnum Equity                                                9.24                  43.47             22.06 %   
   5     ICICI Prudential Top 100                                         19.57                138.93             21.64 %   
                                                                                                   Average        23.20 %   

The top 5 performing funds over a 3 year period are

S. No.                         Scheme name                              NAV 3 years         NAV current          Annualized %
                                                                          before
   1     ICICI Prudential Focused Bluechip Equity Inst I                   10.23                16.99             18.42 %   
   2     ICICI Prudential Focused Bluechip Equity Retail                   10.10                16.43             17.61 %   
   3     ICICI Prudential Top 100 Inst I                                   12.87                20.00             15.83 %   
   4     ICICI Prudential Top 100                                          93.12               138.93             14.27 %   
   5     Franklin India Bluechip                                          143.12               213.25             14.22 %   
                                                                                                   Average        16.07 %   

The top 5 performing funds over a 1 year period are

S. No.                         Scheme name                              NAV 1 year          NAV current          Annualized %
                                                                         before
   1     ICICI Prudential Top 100 Inst I                                  19.28                 20.00             3.73 %    
   2     BNP Paribas Equity                                               34.11                 35.12             2.96 %    
   3     Canara Robeco Large Cap+                                         10.54                 10.81             2.56 %    
   4     ICICI Prudential Top 100                                        135.73                138.93             2.36 %    
   5     Religare Agile                                                   6.63                  6.66              0.45 %    
                                                                                                   Average        2.41 %    




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                                                    Equity – Nifty
The returns of the Nifty index are listed below for 4 different periods.

         Years                  Start value                End value                Absolute %               Annualized %
          10                     1056.60                    5345.35                  405.90 %                 17.60 % 
           5                     4387.15                    5345.35                   21.84 %                  4.03 % 
           3                     3974.05                    5345.35                   34.51 %                 10.39 % 
           1                     5616.10                    5345.35                   -4.82 %                 -4.82 % 

These returns could be achieved by following a passive investment strategy in index mutual funds. This is the
recommended route for investors who do not want to get involved in direct investment in the equities of
individual companies.

It would be possible for skilled investors to achieve higher returns by investing directly in equities of companies
and following an active investment strategy. This is not recommended for normal investors as they involve a
higher degree of risk, and need the investor to have a higher expertise in the dynamics of equity investing.



                                                             Gold
The returns given by gold are listed below for 4 different periods.

         Years                  Start value                End value                Absolute %               Annualized %
          10                       4950                     29465                    495.25 %                 19.53 % 
           5                       8707                     29465                    238.41 %                 27.61 % 
           3                      14500                     29465                    103.21 %                 26.66 % 
           1                      22315                     29465                     32.04 %                 32.04 % 

Investments in gold can be done by investing in physical gold bars and coins, or in the gold Exchange Traded
Funds (ETF's) available on the stock exchanges.




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                                                       Real estate
Analysis of top and bottom 3 cities during the period 2007-2012. NHB Residex's index was used for the analysis.
Top 3 cities – NHB Residex

                          Years          Start          End             Absolute %              Annualized %
                            4             104           304              192.31%                  30.76%
Chennai                     3             120           304              153.33%                  36.32%
                            1             218           304               39.45%                  39.45%

                          Years          Start          End             Absolute %              Annualized %
                            4             100           217              117.00%                  21.37%
Faridabad                   3             139           217               56.12%                  16.01%
                            1             165           217               31.52%                  31.52%

                          Years          Start          End             Absolute %              Annualized %
                            4             101           181               79.21%                  15.70%
Pune                        3             103           181               75.73%                  20.67%
                            1             148           181               22.30%                  22.30%


Bottom 3 cities – NHB Residex

                          Years          Start          End             Absolute %              Annualized %
                            4             119            80              -32.77%                   -9.45%
Jaipur                      3              71            80               12.68%                    4.06%
                            1              67            80               19.40%                  19.40%

                          Years          Start          End             Absolute %              Annualized %
                            4             106            72              -32.08%                   -9.22%
Kochi                       3              90            72              -20.00%                   -7.17%
                            1              86            72              -16.28%                  -16.28%

                          Years          Start          End             Absolute %              Annualized %
                            4             96             86              -10.42%                   -2.71%
Hyderabad                   3             65             86               32.31%                    9.78%
                            1             83             86                3.61%                    3.61%




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                                            Sources of information
The analysis presented above is based on information available in the public domain. Specific sources of the
information are listed below.

Type of Asset                   Information sources
Debt – Savings bank             State Bank of India - www.sbi.co.in

                                Yes Bank - www.yesbank.in

                                HDFC Bank - www.hdfcbank.com

Debt – Fixed deposits           State Bank of India - www.sbi.co.in
                                Term deposit rates of varying durations and below Rs. 1 Crore

Debt – Mutual funds             Value Research - www.valueresearchonline.com
                                Based on the results of the point to point returns calculator for Debt – Income
                                funds

Equity – Mutual funds           Value Research - www.valueresearchonline.com
                                Based on the results of the point to point returns calculator for Equity – Large Cap
                                funds with growth options

Equity – Nifty                  National Stock Exchange of India - www.nseindia.com
                                Historical index data is used for the analysis

Gold                            MCX - www.mcxindia.com

                                www.kitco.com

                                www.goldprice.org

Real estate                     Residex - www.nhb.org.in
                                Data is treated to a subjective analysis due to the localized nature of real estate
                                prices




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