Where to invest Rs 1 lakh, Rs 10 lakh, Rs 1 crore

**Snigdha Sharma** (0:02)
Today on Daybreak, we are doing something a little different, and I think you're going to enjoy it. I'm reading you one of the most popular series that we've ever published at the Cairn by our finance editor Anand Kalyanaraman. It is about your money, and it answers a question that almost all of us wrestle with. Where do you put your surplus money when you finally have some? Whether it's a lakh, ten lakhs, or a full crore. We first ran this back in January, and now, the same experts have answered all over again six months into a market that's changed on them completely. This one normally sits behind our paywall, but today, it is yours. Let's get into it.
It's been a forgettable six months for many investors since the Ken published its inaugural edition of Where to Invest 1 Lakh, 10 Lakh and 1 Crore Rupees in January.
The US-Israel war against Iran took a toll on India's already struggling stock market. Then, despite rising inflation and looming interest rate hikes, gold cooled and silver crashed from its highs. Real estate did not offer much to write home about either. So, in the hunt for returns, many investors sought fixed income options. Fixed income yields may be low, the reasoning went, but something better than nothing. Which brings us to this second edition. The Ken posed the same question. Where should investors put their surplus to the same experts from 6 months ago? Only this time, the question to the 4 Sebi-registered investment advisors and the private wealth manager came with a very different market reality. You could splurge your surplus, whether 1 lakh, 10 lakh or 1 crore, if you felt so inclined, and that would just be fine. But, if you dear investor, choose to delay gratification, the 5 experts offer a raft of investment solutions, from holding steady to changing tack to becoming more opportunistic. The solutions range from the simple to the unconventional. The consensus has not flipped from 6 months ago, but the reasons for diversification have grown stronger. There are some don'ts and home truths too. Here, we crystallize their insights to try and answer the big question, how to invest 1 lakh, 10 lakh and 1 crore rupees.
The valuation hawk. Sumit Duseja is cautious about India despite price to earning multiples, correcting as earnings growth is not showing strong signs of picking up. The co-founder and CEO of global private wealth management company, TrueMind Capital, prefers large cap oriented flexi-cap funds, which allow managers to pick good, small and mid cap stocks too. He is bearish on US tech stocks, but bullish on US value stocks and health care, which he advises buying with ETFs or exchange traded funds. Continue to see value in China and the UAE despite geopolitical risks. Prefers diversified Asian ETF, China, Taiwan, Korea and Singapore, where valuations are more reasonable than the US says Duseja. He also recommends allocating 15-20% at gold at current levels and to silver after a significant correction from current levels. He also advises putting 5% towards copper as a structural deficit in the metal supply is likely to drive up prices. Debt should be a strategic part of the portfolio. Go for liquid debt, which can be moved to equity when valuations are more comfortable. For debt, Dosagea prefers arbitrage funds over fixed deposits due to their tax efficiency. Avoid duration plays as inflation and interest rates may rise.
Do not go for specialized investment funds or SIFs until they build a more solid track record. To justify allocation to alternative investment funds or AIFs and portfolio management services or PMSs, they must generate significantly higher returns to overcome tax and fee hurdles compared to mutual funds. Dosagea suggests global exposure of 20-30% and domestic equity exposure of 30-60% depending on risk appetite. If surplus is less, confine investments largely to the domestic market because the Indian mutual funds channel to global investing has shrunk substantially.
Shashi Singh, founder of financial planning firm Finmine, says that the specific surplus, whether 1 lakh, 10 lakh or 1 crore rupees, is secondary to the investor's risk profile and existing asset allocation. Before investing the surplus, ensure you have an emergency fund and adequate life and health insurance. Deploy surplus as per your timelines. If the goal is to earn returns within 3 years, put the money in arbitrage or money market funds. If it is within 5 years, go for corporate bond funds. And if it is between 5 and 10 years, take a hybrid investment of debt and equity. And if it is beyond 10 years, choose equity.
Don't try to time the market. Stick to predetermined asset allocations, say 60% equity and 40% debt. Deploy the equity portion over 1 to 6 months, and the debt portion at 1 go.