When we plan for a goal, we assume a rate of return on investments for the goal and plan investments accordingly. Picking up the long-term average return is a rational choice. Long term averages are fine (even though long term averages can also change). However, the sequence of returns matters too. For the same level of long-term return, the actual output can be very … [Read more...] about How the Sequence of returns risk affects your Financial Planning?
sequence of returns
Many of us spend a lot of time finding the “Best Mutual Fund” to start a Systematic investment plan (SIP) in. Very little time is devoted to review/re-balancing of the existing portfolio. Is that the correct approach? By the way, there is nothing wrong with trying to find out the best mutual fund to invest in. That the task, in itself, is not so simple, is a different matter … [Read more...] about What do you worry more about? Your existing corpus or the next SIP installment?