Cut Your Losses Fast


And here’s why……..

wealthymatters

What’s the chance that your losers will give the sort of chart busting returns to recoup your losses?In the mean time you are losing the chance to earn at least savings bank returns on your money.You don’t get to spend the sort of money your managers are losing you.Inflation is making the remaining less valuable.And you are losing out on money you could make by reinvesting in better avenues.

Its painful to lose money but more painful to stick with the losers.

 

How To Calculate The Returns From Your Mutual Fund Holdings?


wealthymatters.comIf you have made a one time lump sum investment and opted for the  growth/dividend reinvestment options here is the formula: CAGR = [(final amount/amount invested)^(1/tenure)] – 1

In case you have a SIP and have opted for the growth option,then use the IRR feature in excel to calculate your returns.

In every other case use the XIRR feature in excel.

Remember that money out of your pocket is marked”-” and money into your pocket is “+” while calculating IRR and XIRR. For worked samples see this link.

 

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