FINLATICS

Project 1
Eashwar
 A Years 1 2 3 4 5
% Weightage Returns
FUND A
Debt 7% 50% ₹ 1,75,000 ₹ 1,88,212.50 ₹ 2,02,422.54 ₹ 2,17,705.45 ₹ 2,34,142.21
Equity 13.5% 30% ₹ 2,02,500 ₹ 2,17,788.75 ₹ 2,34,231.80 ₹ 2,51,916.30 ₹ 2,70,935.98
F&O 20%
Risk 40%

B Years 1 2 3 4 5
% Weightage Returns
FUND B Debt 7% 40% ₹ 1,40,000 ₹ 1,51,480 ₹ 1,63,901.36 ₹ 1,77,341.27 ₹ 1,91,883.26
Equity 13.5% 40% ₹ 2,70,000 ₹ 2,92,140 ₹ 3,16,095.48 ₹ 3,42,015.31 ₹ 3,70,060.56
F&O 20%
Risk 55%

C Years 1 2 3 4 5
% Weightage Returns
Debt 7% 30% ₹ 1,05,000 ₹ 1,12,875 ₹ 1,21,340.63 ₹ 1,30,441.17 ₹ 1,40,224.26
FUND C
Equity 13.5% 40% ₹ 2,70,000 ₹ 2,90,250 ₹ 3,12,018.75 ₹ 3,35,420.16 ₹ 3,60,576.67
F&O 30%
Risk 65%
 CAGR CALCULATION

A B C
CAGR - 15 - 18%
Time 5 Yrs End value ₹ 71,94,855.53 ₹ 74,14,917.24 ₹ 71,78,146.63
Start value ₹ 50,00,000 ₹ 50,00,000 ₹ 50,00,000
Investment ₹ 50,00,000 Periods 5 5 5
Debt 7% CAGR 7.55% 8.20% 7.50%

Equity 13.5% CAGR = ( End value / Start value) ^ (1/n) - 1

Funds Years 0 1 2 3 4 5 CAGR F&O Target - 15% F&O Target - 18%

A Investment ₹ 50,00,000 ₹ 53,77,500 57,83,501.25 62,20,155.59 ₹ 66,89,777.34 ₹ 71,94,855.53 7.55% 7.45% 10.45%
₹
B Investment ₹ 50,00,000 ₹ 54,10,000 ₹ 58,53,620 63,33,616.84 ₹ 68,52,973.42 ₹ 74,14,917.24 8.20% 6.80% 9.80%
₹
C Investment ₹ 50,00,000 ₹ 53,75,000 ₹ 57,78,125 62,11,484.38 ₹ 66,77,345.70 ₹ 71,78,146.63 7.50% 7.50% 10.50%
 MY FUND SUGGESTION

My suggestion to Mr. X would be to invest in the

fund “B” because it has the highest Compounded
annual growth rate according to my calculations –
8.20%. Thereby reducing the percentage of gain
needed by Future and options trading – 6.80%(if
the target CAGR is 15%) which would reduce his
risk greatly.
 MY MUTUAL FUND SUGGESTION

My suggestion to Mr. X would be to invest in the

fund “Franklin India Dynamic Asset Allocation
Fund Of Funds Direct-Growth” as it also has the
closest asset allocation that is replicable with
Fund B, 44% Equity, and 49% in Debt instruments,
5 years returns is approximately 15%.