PrimeInvestor - Articles and Reports

In recent times, you may have read about stories of equity indices or equity mutual funds struggling to deliver double digit returns even over 3 and 5-year periods. If many of you had expectations of say 12% return or a 15% returns these numbers are indeed disappointing.

But here’s a question: how did you form your return expectation? I posed this question to some friends. Their response can broadly be categorized into two: one, they either read or were told that equity markets can deliver 15-20% returns. Two, at some point in the past, some of the stocks they held had delivered this return and it naturally became the ‘best return to expect’.

So, what is the right way to form your returns expectation? How much should you expect from your portfolio? Why is that important?

One in three equity funds that have been in the top 2 quartiles for several years in the past have slipped to the bottom 2

Pick up any equity fund today and the 1-year return looks absolutely uninspiring. 8%? 9%? 11%? Losses? Where is that bumper equity return? But if