Ask our experts- October 2022

I am a retired person of about 70 years. I want to invest about Rs 10 lakhs in equities for about 3 to 5 years. I’m expecting a return of 10 to 12% only. Please let me know the well-known companies, as per your research, where I can put my money. – Manikandan Swamy

Equity investments are subject to market risk. Therefore, we cannot ASSURE you a return of 10 to 12 % during this short period. If you have sufficient fund for meeting your retirement expenses, then you may invest in equity otherwise continue the investment in any of the risk-free investment product. To view Geojit’s stock recommendations turn to page 31. But as you may know equity investments are subject to market risks so we suggest you contact your nearest Geojit branch.

I stay in a rented accommodation in Chennai. I am planning to buy a flat for my own use which is scheduled to be completed soon. I currently claim the benefit of HRA (House Rent Allowance). I want to know whether I can claim deduction for housing loan EMIs. Also, till when I can claim the HRA benefit if I buy a house. – Parthasarathy MS

As per income tax laws, you can claim HRA only if you live in a rented house. But after buying a house, if you continue to stay in rented house due to proximity to workplace or any other genuine reason, then you may continue to claim HRA. But you must have proper documents like rent agreement, rent receipt etc. In such situation you can claim home loan repayment amount along with HRA for tax deduction. Note that you should have convincing reasons to show how you are eligible for both.

Which large cap is good? Which SIP showing good performance? – Sanjeev Kulkarni

Every month we are recommending 4 stocks in Geojit Insights and have a mutual funds recommendation section also. We also provide stock recommendations, which are directly emailed to our clients or are made available on sending a WhatsApp request from your registered mobile number. Also, please visit our Smartfolios for curated baskets of stocks for long-term wealth creation. A large cap fund invests a minimum of 80% of its total assets in equity and equity related instruments of large cap companies.

SIP in mutual fund or Nifty BeES/ Bank BeES which is better? – Rafeek

Nifty BeES/ Bank BeES are exchange traded funds. Its portfolio is same as the index which the fund follows. There is no participation of the fund manager for setting up the portfolio. The performance of these funds is almost same as the performance of the index. But in case of mutual funds, the fund manager builds a portfolio based on his conviction to achieve a particular return/risk objective. Though the cost incurred in ETFs are lower than mutual funds, the convenience of portfolio constriction and freedom of choice helps in better alpha creation possibilities in MFs. ETF is more of a passive investment whereas MFs are active strategies. A conservative investor chooses ETFs over MFs, whereas MFs are ideal for long term wealth building.

If I am having a corpus of Rs.1 crore how much money can be invested in equity to be on safer side. I am 70-year retired person. – Joseph Gabriel

Investment into equity market is all about high risk, high return. The market is exposed to all kinds of internal and external risk. There are no safe, secured, or guaranteed returns and if you are prepared to take the risk, only then should you invest in equity market. A person’s risk appetite is largely based on age and if you are an investor who has been investing for many years can go ahead and invest in equities. But if you are investing for the first time, we would advise you to take help from a certified financial planner at Geojit.

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