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SUNDAY WEEKLY ISSUE #12 In 2008, just when the global financial crisis was taking a toll on banks and businesses, Sequoia cap, one of the largest venture capital firms in the world, sent an advisory presentation to all the start-ups they’d invested in. It was called, “R.I.P. Good Times” and you can find it here.
It is a presentation worth being saved and revisited often, whether you are a business or an individual. And if there is only one slide you are going to look at in that pack, head to slide 53 which is titled, “The Solution”. It is a laundry list of things to do when the good times are over. When the going gets tough, the tough get going.
IN TODAY'S NEWSLETTER
MARKET UPDATE SENSEX 46,099 2.1% NIFTY500 11,171 1.6% Brent Crude 49.96 1.8% Gold (per gram) 4,905 -0.5% QUIZ Name the company which holds the world record for highest ever sales/revenue per year? NEWS IN BRIEF
IN LESS THAN A FEW HUNDRED WORDS Hitting the exit button on mutual funds! The association of mutual funds in India (AMFI) recently released data on mutual fund AUM across fund houses and scheme categories. If there is one trend that is super clear from the data, it is that people are hitting the exit button on equity mutual funds. Far more money has gone out of these schemes than have come in over the last 5 months. What’s more, outflows from growth/equity-oriented schemes hit the highest point this year. This chart should give you an overview. 
Hybrid schemes, which invest in part equity & part bonds, have also seen their assets under management (AUM) continuously reduce in value due to cash outflows. Close to Rs.24K crores of money has flown out over the last 5 months. This chart shows the trend. 
The trend in income/debt oriented funds is a bit mixed. Over the last 6 months, they have recorded 2 months of net outflows and the rest have seen net positive inflows into these schemes. However, new inflows as well as new outflows have both reduced drastically (to half of pre-pandemic levels). This is because, given the rather low interest rates on short term maturities, people have moved to longer duration maturities and consequently the monthly churn is lower. 
To be fair, there is more money in mutual funds now than there was on the 31st of March 2020. Heck of a lot more (about Rs.7.75 Lakhs Crores more, 35% growth in AUM). 
But a vast majority of that increase in AUM has come by way of the 60% returns delivered by the index (NIFTY50) since 31 March 2020. Total new money mobilised of Rs.2.72 Lakhs Crores during this period is only slightly above the amount of money that people withdrew in the month of March 2020 (Rs.2.12 Lakhs Crores) from mutual funds. 
The key message is this – No matter the large entourage of people around new fund offerings, no matter the headlines of record high MF AUMs, the real truth is that people are being cautious. And given the silly valuations in the markets, they are right to be so. GAME : THE PRICE IS RIGHT This little embossing right here is called the Scinde Dawk – The first ever postal stamp of India. It is one of the rarest stamps amongst philatelists and was first in circulation in the year 1852. It cost ½ Anna when introduced. It is called Scinde Dawk because its origin is traced back to the Sindh province dawks (Hindustani word for post). One of these rare collections was sold in an auction last year. Your job, is to guess the price at which it was sold for. 
COVER STORY Let's play a mondey game, shall we? 
Let's play a money game, shall we? See how good you are with your money? I will make you two offers and you will have to pick one. Ready? Hit the link below IN CASE YOU MISSED IT... How to invest your money? An Asset Allocation Perspective Earlier last month, we wrote about goal based investing. Later, we took a look at asset allocation based investing. We reviewed the asset classes, assumed a 55%/45% allocation to risky/risk free assets and looked at how an asset allocation based investment would work. Follow along this infographic or check out the full version of it at our website here. 
The key to getting your asset mix (risky vs. risk free assets) right, is to quantify your risk tolerance. But how exactly would one quantify risk tolerance? Hit the link below to know more and find out the ideal asset allocation for you. ANSWER TO QUIZ WALMART Is the company which holds the world record for highest ever revenue/sales per year. It clocked in total revenues of $524 Billion in the year 2019. If Walmart were a country, it’s GDP would be the 25th largest in the world ahead of countries like Austria, Singapore, Malaysia and New Zealand. IN OTHER NEWS
THOUGHT FOR THE DAY But you, may have an aptitude for ballet 🙂 
ANSWER TO THE PRICE IS RIGHT ₹8 Lakhs The price at which India's (& Asia's) first postal stamp Scinde Dawk was sold for in an auction in last year. Its sale price in 1852 was 1/2 anna! Calculate the return on that investment! Speaking of which, did you manage to read our special edition from last week on post office? READ/WATCH/LISTEN
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