FIFA PERSPECTIVES November 2016

Happenings:

A Season For Surprises: Takeaways from December RBI policy

The RBI policy surprised most in the market, in that not only did the central bank not cut rates (an outcome

expected by a minority) but actually came out sounding quite a bit hawkish. Key takeaways were as follows: 1. Growth outlook for the current year is uncertain with the demonetization; especially since there was already a

50 bps momentum loss after Q2. There are broadly 2 channels of effect that RBI sees: a) short run disruption in economic

activity in cash intensive sectors, b) aggregate demand compression associated with adverse wealth effects. It assesses,

however, that impact of first will ebb once cash in circulation improves and non-cash based payment instruments gain

greater usage. Whereas, the compression on account of wealth effect is ‘likely to be limited’. On net, GVA growth for FY

17 is revised from 7.6% to 7.1% with evenly balanced risk.

2. On CPI, the committee ‘took note’ of upturn in prices of several items that is masked by easing on the back of

base effects. There is acknowledgement that demonetization could push down prices of perishables in the next CPI print.

However, prices of wheat, gram, and sugar have been firming up. Moreover, they assess that impact of slowdown of dis-

cretionary consumption on the goods and services component of CPI (16% of basket) may also be transitory. Prices of an-

other large component of CPI comprising housing, fuel, health, transport etc comprising 38% of the basket may remain

largely unaffected. General upside risks may emerge if winter moderation to food prices doesn’t transpire owing to disrup-

tions, or from the usual suspects: crude and rupee. All told, Q3 inflation may fall by 10 – 15 bps, but the headline CPI for

Q4 2016 – 17 is retained at 5% with still upside risks; although lower than that in October.

Takeaways:

The outcome is surprising not because a strict CPI targeting central bank shouldn’t behave this way.

Indeed, Dr. Patel had taken pains to take market attention away from the 4% target, saying that this

target was no longer valid as the official range now was 4+/-2%. Additionally, rather than focusing on

comfort with respect to incremental disinflation, it seemed that the RBI was preparing us for further

cuts on justification that the so-called real rate can be brought down to 1.25% from the 1.5 – 2% band

earlier.

Investor Implications:

Market has been clearly taken aback with the decision, leading to aggressive paring of risk positions in the

market. However, once it does, investors need to keep the following points in view:

1. The RBI has perhaps been a shade too deterministic since effects around the demonetization program are still

yet unfolding. Therefore, it stands to reason that if the effects sustain and lead to lower than expected growth and a

greater than expected CPI impact, the RBI would also switch back to a dovish reaction function. Thus for instance and to

take just one aspect of this, property prices have yet not fallen. Transactions have merely dried up. So it is as yet difficult

to anticipate the wealth effect erosion and hence impact on discretionary consumption.

2. Unlike macro events that only require an ‘expectations’ re-pricing, this one has direct implications on bank

deposit rates and so forth. Thus whatever the gyrations in 10 year bond yields, it is likely that investors will not get sea-

sonally higher FD rates this year, as they typically do during Jan – Mar every year. Therefore, the need to plug reinvest-

ment risk in line with risk appetite is very much relevant; notwithstanding the rate decision..

Events:

Mumbai:

Estate Planning Workshop in Mumbai on 26th Nov 2016

On Saturday 26th November, DHFL Pramerica Asset Managers partnered FIFA in its Monthly knowledge sharing initiative.

DHFL Pramerica in association with American Acade-my of Financial Management India Pvt Ltd specially designed a certification workshop on Estate Planning.

The same was conducted by experts from AAFM and C.C. Choksi and Company a leading firm involved in Capital

Raising, Business and Transaction Advisory, Legal and Tax Advisory and Succession, Trust and Estate Advi-sory.

Wealth transmission is important because it takes years or even decades to create and preserve wealth but the same wealth can get seriously impaired if the creator does not carefully plan transmission in a clear manner. It is imperative that advisors pay more attention

Learning Outcomes:

Enter into the spectrum of Trust and Estate Planning Products.

Learn more about Trusts, Estate Planning Process, Estate Planning Products, Tax Planning through Trusts etc.

Understand the various Wealth & Property Transfer Techniques.

Drive the Set-Up of the Estate Planning advisory Business.

Will learn the various documents associated with Real Estate along with the Real Estate Title Verification Process,

Evaluate Real Estate as an Investment Option The members agreed that the Benefits of wealth creation and wealth preservation had been propagated for a long time. The third step that completes the ‘wealth management’ is wealth transmission. The ses-sions reinforced the view that advisors must engage with clients on wealth transmission very early. IFAs stand to gain tremendously by bringing this step up-front with their clients. because normally a client invests only part of his surplus through one distributor whereas while in making a will he will have to dis-close his complete wealth and there lies the trust in the IFA and opportunity for IFA. Psychology of Investment Decisions in Guwahati on 18th Nov 2016

Franklin Templeton Academy has designed to furnish some basic as well as advanced shade of the financial markets to the

FIFA Members in Guwahati, Mr. Winston Noronha (Head – Franklin Templeton Academy) has given the presentation on the

date of 18th Nov 2016 at Hotel Kiranshree Portico, Guwahati.

Franklin also provides a platforms to share with them their years of learning and experience about investor attitudes and behaviour. This program seek to illustrate some of the physiological/behavioural biases that investors are prone to exhibiting in their investment decision and the invest-

Contributions by Roopa Venkat

https://www.dsij.in/article-details/articleid/17083/sip-a-saviour-for-mutual-

fund-net-inflows-in-fy17-so-far.aspx

http://economictimes.indiatimes.com/markets/stocks/news/90000-return-

in-10-years-this-stock-was-as-cheap-as-a-toffee-can-get-you-a-3-bhk-flat-

now/articleshow/55847150.cms

http://m.economictimes.com/wealth/invest/mutual-funds-with-instant-

redemption-as-bank-fds/articleshow/55769804.cms?

Excerpts from Demonetisation: Politics trumps economics– Mint 9th DEC

The past century has witnessed several demonetisations, when governments have decided that existing national cur-rencies, guaranteed by the sovereign, are no longer legal tender. It has happened in: (a) countries that have experi-enced hyperinflation—where inflation rates are measured per week or per month rather than per annum—such as Germany in 1923 or Argentina thrice in the 20th century; (b) countries on the verge of economic collapse, such as Zimbabwe in 2015; and (c) countries in deep economic or political crises, such as Ghana in 1982, Nigeria in 1984, My-anmar in 1987, Zaire in 1993 and the USSR in 1991. In most, outcomes were failures, if not disasters.

The situation in India is completely different from what it was in these countries at the time of demonetisation. The

economy is characterized by rapid growth and price stability. The polity is a vibrant democracy with an elected gov-

ernment. Hence, past experience elsewhere has little relevance. Yet, history matters.

What, then, is the rationale for demonetisation in India? The stated objective is economic. The government hopes to

eradicate black money, as also combat corruption, smuggling, and counterfeit notes. The unstated objective is politi-

cal. The government, exactly halfway through its five-year term, concerned about perceptions that little had

changed, wanted to do something bold. For the Prime Minister, there is also a pro-poor populism, in acting against

the rich who evaded laws, and in reaching out to people directly, without any intermediation through his political

party. The state elections to come in early 2017 are part of the same political calculus, not only because Modi wishes

to be seen as a man of the people, but also because demonetisation will wipe out any hordes of black money held in

cash by opposition political parties. Of course, it must be recognized that economics and politics, closely intertwined,

are inseparable. Indeed, their interaction is likely to shape future outcomes.

The economics underlying demonetisation has three flaws.

1. all black money is not held in cash, and all cash is not black money. Political parties, corrupt government officials,

lawyers, doctors, traders or builders, might keep some black money in cash, but more than 90% is in the form of

gold, real estate, foreign accounts and used in consumption or business expenditures. Similarly, less than 10% of

cash in the economy would be black money.

2. it is very difficult to separate black money from white money because the distinction is not once-and-for-all.

White money used to purchase something becomes black if the shopkeeper does not pay sales tax but could be-

come white again if he then buys something with it for which he is billed with tax.

3. demonetisation would indeed wipe out stocks of black money held in cash if it cannot be laundered. But it could

be business-as-usual with new notes as flows of black money resume, unless there are changes in government

Hi Friends,

Please do contribute generously to the newsletter. Looking forward to original articles or shares meant for the distributor community. Events which you are hosting could be shared via photos and short write-ups. Do send your contribution to response@fifaindia.com

Nisreen Mamaji– Editor

M Type

Mem-

bershi

p Name of Organisation/ IFA Representative(s) NAME CITY

Founder F112 Bhavik Girish Dand Bhavik Dand Mumbai

Founder F113 First Advisors & Consultancy P L Vikash Kumar Tulsyan Dhanbad

Chetan Kumar Tulsyan

Founder F114 Bawri Finserv Vijaye Bawri Shillong

Vinitt Bawri

Harshit Bawri

Founder F115 Secure Life Sundeep Singhal New Delhi

Founder F116 TCM Advisory P L Rashmi Thukral Bhadohi

Founder F117 Vinod Kumar Anand Vinod Kumar Anand New Delhi

Life L135 Fortune Finsec P L Suresh Kumar Kakani Indore

Life L136 Bhandarkar Investment Consultancy Services

Kesargadde Nityanand Shankar Mumbai

Life L137 Anurag Poddar Anurag Poddar Guwahati

Life L138 Deepak Kumar Shukla Deepak Kumar Shukla Kanpur

Life O501 Accord Financial Services New Delhi

General O979 Jimmy K M Jimmy K M Thrissur

General O980 Invest Inn Pvt Ltd T J Simon Thrissur

General O981 Vikas Janbaji Hore Vikas Janbaji Hore Nagpur

General O982 Ascent Aarjay Fincap Services P L Jayesh Chauhan Nagpur

General O983 Dewin Pradip Kothari Dewin Pradip Kothari Nagpur

General O984 Manish Joshi Manish Bipin Joshi Nagpur

General O985 Motilal Oswal Securities Ltd Prashant Arun Pimpalwar Nagpur

General O986 Pra Capital Services P L Lakhbir Singh Ludhiana

General O987 Amit Kumar Amit Kumar Ludhiana

General O988 Wealth Creater Web Vikas Gupta Ludhiana

General O989 Shiva Prasad Konduru Shiva Prasad Konduru Ludhiana

General O990 ACE Combine Mahendra Hari Kamath NAgpur

General O991 Anirudha Manohar Bhogle Anirudha Manohar Bhogle Mapusa

General O992 Star Investments Avelino Nicolau De sa Panaji

General O993 Mitesh Suresh Chafadkar Mitesh Suresh Chafadkar Margao

General O994 Gurupad S Parsi Gurupad S Parsi

Vasco Da

Gama

General O995 Gauri Girish Salelkar Gauri Girish Salelkar Panaji

General O996 Wealth Management Laxmi Mahesh Khanolkar Mapusa

General O997 Francis Michael D'cruz Francis Michael D'cruz Mapusa

General O998 Siddhesh Radhakrishna Shetye Siddhesh Radhakrishna Shetye Panaji

General O999 Shanker Ramesh Agshikar Shanker Ramesh Agshikar Taligao

General O1000 Imperial Wealth Services Dhruv Harish Rajani Panaji

General O1001 Shrinivas Prabhakar Shenai Shrinivas Prabhakar Shenai Panaji

General O1002 Shantaee Investments Shantaram P S Kundaikar Panaji

General O1003 Moneywise Victor J D Fernandes Goa

General O1004 Jennifer Maria Mendes Jennifer Maria Mendes Goa

General O1005 Sushant Anant Naik Sushant Anant Naik Panaji

General O1006 Shreya Rajesh Shinkre Shreya Rajesh Shinkre Panaji

General O1007 Prashant Vasudeo Chimulkar Prashant Vasudeo Chimulkar Ponda

General O1008 Fanidias & Associates Luis Ian Dias Panaji

General O1009 Maheshwar Shrikant Beigeri Maheshwar Shrikant Betgeri Vasco Da Gama

General O1010 A Satheesh Rao A Satheesh Rao Panaji

General O1011 Sandeep Shripad Vaidya Sandeep Shripad Vaidya Margao

General O1012 Brito Sa Ressurreicao Fernandes Brito Sa Ressurreicao Fernandes Panaji

General O1013 Aditi Niraj Prabhu Aditi Niraj Prabhu Merces

General O1014 Financial Consultant Purushottam Jagannath Kareker Verna

General O1015 Happy Investments Vrushali Vivek Parsekar Panaji

General O1016 DPM Financial Services Danny Piedade Vasco Da Gama

General O1017 Goa Investment Ryanel Sylvester Carvalho Vasco Da Gama

General O1018 Veeraj Govind Mahatme Veeraj Govind Mahatme Zuarinagar

General O1019 Pradeep Rama Korgaonkar Pradeep Rama Korgaonkar Vasco Da Gama

General O1020 D B Desai Diwakar Balaji Desai Kudal

General O1021 Patel Financial Solutions Bhavna Viran Patel Vadodara

General O1022 Raz Investments & Services Hooseni M Chunawala Vadodara

General O1023 Sandeep Kumar Burnwal Sandeep Kumar Burnwal Dhanbad

General O1024 Nityam Investment Tejash Pravinchandra Barfiwala Surat

General O1025 Solitaire Financial Solutions Ami Vishal Dalal Surat

General O1026 Sethi Investments Gireesh Kumar Sethi Ambala

General O1027 Pankaj Bansal Pankaj Bansal Zirakhpur

General O1028 Jain Investments Sushil Tarachand Jain Amravati

General O1029 Athawale Investment Mahesh Keshaorao Athawale Amravati

General O1030 Rajendra Mitilal Gandhi Rajendra Mitilal Gandhi Yavatmal

General O1031 Rangwala Investment Service Shabbir Husain Asgar Ali Rangwala Amravati

General O1032 Anant Devidas Kale Anant Devidas Kale Amravati

General O1033 Intouch Financial Services P L Vivek Goyal Chandigarh

General O1034 Your Financial Friend Bobby Aggarwal Ambala

General O1035 Srinivasa Thyagaraja Marella Srinivasa Thyagaraja Marella Proddatur

General O1036 Khumar Finance Venkata Satya khumar Nookala Kurnool

General O1037 Rama Prasad Chekka Rama Prasad Chekka Proddatur

General O1038 Sree Financials Sreenivas Reddy Sangi Reddy Proddatur

General O1039 AKM Wealth Management P L Amit Kumar Maheshwari Indore

General O1040 Deepak Maheshwari Deepak Maheshwari Indore

General O1041 Hemant Agrawal Hemant Agrawal Indore

General O1042 Money Nivesh Mahesh Ghumare Indore

General O1043 Sanjay M Nanavati Sanjay Mahendrakumar Nanavati Mumbai

General O1044 G B Venkatraman G B Venkatraman Pollachi

General O1045 Nest Financial Planners K Mohideen Malik Pollachi

General O1046 C Srinivasan C Srinivasan Coimbatore

General O1047 S Suresh S Suresh Udumalpet

General O1048 GG Associates Vellingirin Coimbatore

General O1049 M Saravana Kumar M Saravana Kumar Pollachi

General O1050 Jayakanthan Dhandapani Jayakanthan Dhandapani Coimbatore

General O1051 Manikandan Jayakumar Manikandan Jayakumar Coimbatore

General O1052 S N Mohanbabu S N Mohanbabu Coimbatore

General O1053 K C Boopal K C Boopal Coimbatore

General O1054 C Guruvel C Guruvel Coimbatore

General O1055 Silverstone Shares & Securities P L Bharat D Shah Coimbatore

General O1056 Shri Athreya Investment Consultants Srinivasan Venkateswaran Coimbatore

General O1057 Mutual Fund Advisor Veerappan Ragupathi Coimbatore

General O1058 Ashok M Patel Ashok M Patel Coimbatore

General O1059 S Charles S Charles Coimbatore

General O1060 DKS And Buts N Sunder Coimbatore

General O1061 S Kanagaraj S Kanagaraj Coimbatore

General O1062 United Investment Services I Raja Mohammed Coimbatore

General O1063 N Prasath N Prasath Coimbatore

General O1064 N Meenakshi Sundaram N Meenakshi Sundaram Indore

General O1065 Aishwariya Money C R Ananth Coimbatore

General O1066 Hari Wealth Management M Nellainayakam Coimbatore

General O1067 K Venkateswaran K Venkateswaran Coimbatore

General O1068 VC Investment & Insurance Service P Venugopal Coimbatore

General O1069 Mahipal R Parihar Mahipal R Parihar Coimbatore

General O1070 Sudhir Babu Bhupti Sudhir Babu Bhupti Guntur

General O1071 Vijaya Lakshmi Uppalapati Vijaya Lakshmi Uppalapati Vijayawada

General O1072 V K Associates Vana Krishna Gunti Vijayawada

General O1073 KNV S Sarma Satyanarayana Sarma KNV Vijayawada

General O1074 Wellwisher Investments Srinivas Rao Kasinathuni Vijayawada

General O1075 Deepak Payagonda Patil Deepak Payagonda Patil Ichalkaranji

General O1076 Paramjeet Singh Chana Paramjeet Singh Chana Ludhiana

General O1077 Kamal Sood Kamal Sood Ludhiana

General O1078 Shri Financial Shoppe Sumit Sharma Jalandhar

General O1079 Green Hedge Capital Rasmeet Singh Sethi Amritsar

General O1080 Kalbere Consultancy Mohan Balkrishna Kalbere Navi Mumbai

General O1081 Suresh Kumar Tumdulal Jain Suresh Kumar Tumdulal Jain Nandurbar

General O1082 Anil Bansilal Mundada Anil Bansilal Mundada jalgaon

General O1083 Umang Mehta Umang Sureshchandra Mehta jalgaon

General O1084 Ankita Narsey Ankita Kunal Narsey Mumbai

General O1085 DBD Investment Consultant Dhaval Bhupatrai Doshi Mumbai

General O1086 Wealth Creators Ramanan Bakthavtsalam Coimbatore

General O1087 Cerebral Advisors Tejas G V Bangalore

Rajesh R

General O1088 Rayomand K Madan Rayomand Kaikhushru Madan NAgpur

General O1089 Bilidh Financial Solutions Ranjit Talukdar Guwahati

General O1090 Deepak Jain Deepak Jain Guwahati

General O1091 Rajesh Kumar Gangwal Rajesh Kumar Gangwal Guwahati

General O1092 Agastee Investments Agasti Girish Dabke Mumbai

General O1093 Santosh Shashikant Railkar Santosh Shashikant Railkar Raigad

General O1094 Amol Date Amol Arun Date Raigad

General O1095 Vaibhavi Bharat Tanna Vaibhavi Bharat Tanna Raigad

General O1096 Bharat Amrutlal Tanna Bharat Amrutlal Tanna Raigad

General O1097 Anad Y Bhagwat Tax & Financial Advisor Anand Yashwant Bhagwat Raigad

General O1098 Insynch Wealth Management LLP Ninad Parundekar Pune

General Ajit Godbole

General O1099 Suresh T Suryavanshi Suresh T Suryavanshi Bangalore

General O1100 Satya Gopala Krishna Manapragada Satya Gopala Krishna Manapragada

Tadepalligud

em

General O1101 H K L Mago H K L Mago PAnchkula

General O1102 Investassure Advisor Anil Chhatwal Chandigarh

General O1103 Krishnan Raman Vedant Krishnan Raman Vedant Thane

General O1104 Thirumals Wealth Oracle Chitra Thirumal Zirakhpur

General O1105 Omkar Giri Omkar Giri Jamshedpur

General O1106 Sawa Consultancy P L Dhiraj Kumar Sawa Jamshedpur

General O1107 Subodh Kumar Rai Subodh Kumar Rai Jamshedpur

General O1108 Satyajit Barua Satyajit Barua Jamshedpur

General O1109 Mutual Fund Distribution Sadique Anwar Ludhiana

General O1110 Anoop Kumar G Anoop Kumar G

Pathanamthi

tta

General O1111 Ron P Abraham Ron P Abraham Kottayam

General O1112 Jacob Arangath James Jacob Arangath James Kottayam

General O1113 Chaitanya Financial Consultancy P L Hemant Dhundiraj Vidwans Mumbai

Amit Hemant Vidwans

General O1114 Prashant Harivallabhbhai Jani Prashant Harivallabhbhai Jani

Surendrana-

gar

General O1115 Jayeshkumar Jayantilal Pattani Jayeshkumar Jayantilal Pattani Porbandar

General O1116 Smita Manoj Mukim Smita Manoj Mukim Mumbai

General O1117 Arvind Thakur Arvind Thakur Sundernagar

General O1118 Akshay Pandit Akshay Pandit Dhaliara

General O1119 Rajesh Kumar Rajesh Kumar Solan

General O1120 Kishore Haridas Mehta Kishore Haridas Mehta Mumbai