If you are a beginner, there is a high chance that you will feel like selling mutual funds and getting out of the investment as soon as possible. The regular fluctuations in the fund’s value tempt you to sell these funds and get all the profits right away.

If you are planning to do the same, ask yourself this question “what’s the best and easiest possible way to generate significant profit from your investment”? The answer is “compounding”. Now, what element helps investors to build compounding? Well, you might have learned this in your high-school days but the time affects your compounding rate.

As you stay invested in mutual funds and other investment options, your compounding interest increases. To put it in simple terms, the longer your investment period, the better the profits you can expect. The most important factor that plays a major role in increasing your earnings is time.

What about the Rise and Downfalls?

We all know that mutual funds are subject to market risks, which means you cannot control their movement. The only thing you can do is expect good. The ups and downs you get to face during the investment period are sufficient to disturb your confidence and encourage you to draw the money at the earliest possible time. As a result, you end up withdrawing all your investments. It is important to note that these decisions can have a negative impact on your overall investment portfolio.

Equity profits generate in small portions. That’s the reason why experts recommend a longer investment period for the beginners as well as experienced professionals. Sure, equity investment carries a significant amount of risk. But, this is the only form of investment that ensures a higher profit at the end of the maturity period. You cannot expect your equity investment to witness a rise within the first few months. As mentioned before, the equity gains are generated in small portions.

How Long-term Investment Benefit the Investor?

Let’s say you withdraw your investment from equity just because you don’t find it a lucrative option or you don’t witness some major gains. All of a sudden, the market condition improves and people who stayed invested enjoy larger chunks of profits. One wrong decision and your entire investment portfolio disturb. Not only that, but you also miss out on a major opportunity of earning handsome profits.

If you are new to the investment realm, note that the total time of investment in equity markets can be anywhere between 5-10 years. In these 10 years, your equity shares will experience a major gain period that lasts for 30-40 days. But no one knows which one or two months period in the 10-year duration will it be. Everyone waits for these 30-40 days when they’ll be able to make high profits from their equity investment. The only possible way to leverage this opportunity is to wait and stay invested until the market condition works in your favor.

How Long Should You Stay Invested?

Not every investor can stay invested for 10 years. The number of years you should stay invested depends on certain factors such as your risk appetite, profit expectations, and other such factors. If you could bear high-risks than equity investment is the best option. On the other hand, investors with little to moderate risk appetite should choose short-term or medium-term investment opportunities. Let’s learn about each type of investment on the basis of their time period in brief:

Immediate Term: If you have immediate-term goals, which is for less than a year, then money market instruments can serve as the best investment objects. Not only are they less volatile, but they offer great liquidity. As compared to the equity investments, money market instruments can prove the best option for investors who are not willing to take high risks.

Short-term: If you are planning to stay invested for more than a year yet less than 3 years, you are investing in short-term investment options. Sure, the risk is relatively higher than the money market instruments but it also offers a good rate of return. Short-term investments are a combination of debt securities, equity, and money market income funds.

Medium-term: Investment made for a period of 3 to 8 years falls in the category of mid-term investment. Luckily, investors get to pick from several medium-term investment options such as bonds, index funds, balanced mutual funds, and so on. Experts recommend partial debt security investment to stabilize your risk and ensure good returns.

Long-term: If your investment period exceeds 8-year duration, then it falls in the long-term investment category. These investment options are preferred by people who have long-term financial objectives such as building a house, children’s education, marriage, and so on. The risk involved is quite higher, but it offers a higher rate of returns.

Also Read: Investment Outlook – The Debt Market and Its Growth as Per September 2019

Investment Outlook – The Current Equity Market Scenario

What are Mutual Funds? Types of Mutual Funds, Schemes and Benefits

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The Share Market A Guide to Trading (2)

The Share Market: A Guide to Trading – Gill Broking

It is, therefore, important to learn both the pros and cons of intraday trading to get a better idea of how this market works and how exactly you can grow your money. In this post, we will walk you through a few advantages and disadvantages of intraday trading. So, keep reading to learn more.

• Beware of fixed/guaranteed/regular returns/ capital protection schemes. Brokers or their authorized persons or any of their associates are not authorized to offer fixed/guaranteed/regular returns/ capital protection on your investment or authorized to enter into any loan agreement with you to pay interest on the funds offered by you. Please note that in case of default of a member claim for funds or securities given to the broker under any arrangement/ agreement of indicative return will not be accepted by the relevant Committee of the Exchange as per the approved norms.
• Ensure that pay-out of funds/securities is received in your account within 1 working day from the date of pay-out.
• Be careful while executing the PoA (Power of Attorney) – specify all the rights that the stock broker can exercise and timeframe for which PoA is valid. It may be noted that PoA is not a mandatory requirement as per SEBI / Exchanges.
• Register for online applications viz Speed-e and Easiest provided by Depositories for online delivery of securities as an alternative to PoA.

• Do not keep funds idle with the Stock Broker. Please note that your stock broker has to return the credit balance lying with them, within three working days in case you have not done any transaction within last 30 calendar days. Please note that in case of default of a Member, claim for funds and securities, without any transaction on the exchange will not be accepted by the relevant Committee of the Exchange as per the approved norms.

• Check the frequency of accounts settlement opted for. If you have opted for running account, please ensure that your broker settles your account and, in any case, not later than once in 90 days (or 30 days if you have opted for 30 days settlement). In case of declaration of trading member as defaulter, the claims of clients against such defaulter member would be subject to norms for eligibility of claims for compensation from IPF to the clients of the defaulter member. These norms are available on Exchange website at following link: NSE, MCX

• Brokers are not permitted to accept transfer of securities as margin. Securities offered as margin/ collateral MUST remain in the account of the client and can be pledged to the broker only by way of ‘margin pledge’, created in the Depository system. Clients are not permitted to place any securities with the broker or associate of the broker or authorized person of the broker for any reason. Broker can take securities belonging to clients only for settlement of securities sold by the client.

• Always keep your contact details viz. Mobile number/Email ID updated with the stock broker. Email and mobile number is mandatory and you must provide the same to your broker for updation in Exchange records. You must immediately take up the matter with Stock Broker/Exchange if you are not receiving the messages from Exchange/Depositories regularly.

• Don’t ignore any emails/SMSs received from the Exchange for trades done by you. Verify the same with the Contract notes/Statement of accounts received from your broker and report discrepancy, if any, to your broker in writing immediately and if the Stock Broker does not respond, please take this up with the Exchange/Depositories forthwith.

• Check messages sent by Exchanges on a weekly basis regarding funds and securities balances reported by the trading member, compare it with the weekly statement of account sent by broker and immediately raise a concern to the exchange if you notice a discrepancy.

• Please do not transfer funds, for the purposes of trading to anyone, including an authorized person or an associate of the broker, other than a SEBI registered Stock broker.

• Do not deal with unregistered intermediaries (who are not registered with SEBI/Exchanges).

Names and contact details of all Key Managerial Personnel including Compliance Officer

Sr. No.Name of the IndividualDesignationContact NumbersEmail Id
1 Charanpreet GillCEO/MD011-40345555admin@gillbroking.com
2 Charanpreet GillWhole Time Director011-40345555gillbroking@gmail.com
3 Charanpreet GillCompliance officer011-40345555compliance@gillbroking.com
4Manpriya GillDesignated Director-1011-40345555manngill04@gmail.com
5Kewal GillDesignated Director-2011-40345555fvwealth@gmail.com

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