For Information contact us at contact@wallsofindia.con or call us at 96504 59955 K2/1, FF, DLF Phase – II, Gurgaon – 122008, Haryana, India

Seen Seven Wonders. Know the “Eighth Wonder of the World”

In the words of Albert Einstein “Compounding is the eighth wonder of the world, one who understands

Earns it and who doesn’t Pays it. Compounding your money with monthly investments is the wiser way

of building wealth for long term needs. It is very important to know how compounding will work your

way. Let’s see.

Suppose a bank deposit says earn 9% p.a compounded semi annually, which means bank will

give interest twice and the earned rate would be 9.20% because you get interest on interest.

Now you get, higher the percentage you earn, better the compounding works for you.

The best way to build wealth is to invest regularly probably every month to nullify the volatility

and reap the benefit of high yield through Systematic Investment Plans (SIP’s) in mutual funds.

Let’s understand better with the snapshot:-

Particulars Bank FD Debt Schemes Equity mutual

fund

Tenure 25 25 25

Yield 9% 11% 15%

Monthly inv. -5000 -5000 -5000

You Paid -Rs. 15,00,000 -Rs. 15,00,000 -Rs. 15,00,000

Final amount Rs. 56,05,610 Rs. 78,80,667 Rs. 1,62,17,648

Additional income for Bank FD Rs. 22,75,057 Rs. 1,06,12,038

Equity investments have always been biggest wealth creators of all time which has even beaten best guy

imagination.

Stocks Rs.1000 invested is now Annual return

Infosys 29 Lakhs 48.98%

Lupin 11.70 Lakhs 80.17%

Wipro 8.75 Lakhs 40.31%

Motherson Sumi 7.75 Lakhs 55.82%

Shree cement 6.44 Lakhs 49.82%

Kotak Mahindra 6.08 lakhs 58.07%

Emami 5.44 Lakhs 41.90%

Vakrangee 5.25 Lakhs 56.42%

Eicher motors 4.52 Lakhs 54.76%

Aurbindo Pharma 4.52 Lakhs 43.28%

No working individual can put in the required time and research to identify the individual stocks

to invest. The ideal route to reap the benefit of the Bull Run in the economy is to route your

money through Mutual funds SIP’s.

They are market professionals who put in required time and effort to select quality stocks which

can give superior returns in future.

If one would have

sold his Cycle and

bought Infosys, he

would have bought

a BMW for himself.

Rs. 25,00,000 Rs. 1,25,00,000

Bank FD

Debt Schemes

Equity mutu…

For Information contact us at contact@wallsofindia.con or call us at 96504 59955 K2/1, FF, DLF Phase – II, Gurgaon – 122008, Haryana, India

Let’s glance through some good quality Mutual funds and their return chart in last 10 years.

Mutual funds

Fund name 10 years return Money made

HDFC Top 200 20.54% Rs. 38,93,662

BSL Frontline equity fund 21.14% Rs. 40,47,461

ICICI Value discovery 24.01% Rs. 48,85,825

One should target to start SIP’s with different objectives and build on it. Following are some examples to

accumulate wealth for different purposes:-

1. Child higher education – Have long term approach, invest in good quality large cap mutual fund.

2. Retirement Planning – Start a SIP in a Large and Midcap fund.

3. Vacation Planning – Invest in Debt scheme.

4. Contingency fund – Start a SIP in a liquid fund, which fetches higher interest than savings

account.

Starting with Rs.50 thousand in 1st year and regularly increasing the investment amount by mere

10% every year compounding at 15% can make you Rs.2.20 crore in 25 years on a conservative

thinking. This is the real power of compounding.

Year Savings per year Total value

1 Rs. 50,000 Rs. 50,000

2 Rs. 55,000 Rs. 1,12,500

3 Rs. 60,500 Rs. 1,89,875

24 Rs. 4,47,715 Rs. 1,87,75,444

25 Rs. 4,92,487 Rs. 2,20,84,247

Compounding money and building Wealth is the ability to fully experience life. Do what you love and love

what you do, money will follow in pursuit of you.

********

Lack of money is root

of all evil. So plan well

and spend less.

Ten thousand every month

for ten years would have

made you richer by this

amount, had you invested in

these funds.

HOW TO START

For any information and questions regarding investments in mutual funds and stocks ,

contact Abhishek Mittal , CFA +91 991.117.1977 or at amittal@wallsofindia.com