Performance
In this figure, we show the final amounts that are available for withdrawal when one invests 1 Lakh Rupees for a duration of 5 years, 10 years, etc.
Our assumptions:
- Out of bank interest of 6% assumed each year, 30% goes away in the form of marginal taxes each year
- Nifty 50 gives an IRR (Internal Rate of Return) of 10.74%
- Nifty Midcap 150 gives an IRR of 13.07%
- Nifty 50 and Midcap ETF/Index investments are taxed only once at the end at long-term capital gains (LTCG) tax rate of 10% along with additional cess, to the tune of 12.5% in total
The exact numbers used in the above figure are shown in this table.
If a person invests 1 Lakh Rupees in Nifty 50 for 35 years, she would get 31.09 Lakhs! (under above assumptions)
You may wonder, then why is it that everyone's not investing in Nifty 50 or Nifty Midcap 150 ?
In this image we show, what the real-feel is like when investing into Nifty 50 and Nifty Midcap 150 vs. doing the same into bank/term deposit.
Also, if one is not careful about market conditions while investing lumpsum amounts, the returns could be really poor (even negative) for a long time (even 5 years or more). Checkout our unique value-add section below which explains how we protect you from poor returns.
As you can see it is not a smooth ride, investors who are investing may go through a range of emotions over time. Important thing is to not get carried away when markets are on the higher side and not to get depressed when markets are on the lower side. And to always plan much ahead (say, 2 years ahead) for any required withdrawals.
We will do risk assessment to ensure that you can sustain this risk, however, you should also do your own assessment and be ready to take the risk. Once the risky nature of the markets is understood, the returns as you can see, clearly make up for the risk taken and give you good solid wealth for your long-term goals.
What is Elystar's unique value-add?
As we mentioned above, unless one is careful about market conditions when investing lumpsum amounts, the returns could be really bad even after years of investing.
This image shows the 5-year performances of investments into Nifty 50 at various points in time. As you can see, many times even after 5 years, the total returns are not even 33% (annualized returns not even 6%), sometimes even negative!
This could be because one has invested in an overheated market or one is exiting during a depression or both! Through our understanding of the markets and using AI-powered models, our ETF Star advice will help you make an investment plan for lumpsum amounts based on market conditions, instead of just buying blindly at any time. And our Exit Plan advice will help you in planning your exits from investments based on market conditions, instead of selling blindly at any time. With these two services, we help you avoid low returns on your large investments and make a significant value-add to you.
Other value-additions in this service are to:
- Help you know about your risk profile, assess whether you are ready for equity investing
- Determine how much you can invest in large caps and how much in midcaps
- We analyze many Exchange Traded Funds (ETFs) tracking the Nifty 50 and Nifty Midcap 150 indices and determine which are the best ones for you to invest considering factors such as liquidity, tracking error, etc.
- We will also be available in case of any doubts and queries you may have over the years and can help you investing in the best ETFs each year and also optimize the strategy to your changing financial conditions and goals