Dear Policyholders,
   I am addressing again after about a month which has seen indices go up very fast and the Nifty has now reached a high level of above 5900. I have noticed pointers which indicate that a correction of about 5 to 10 % is on cards. Respecting this very observation I now advise you to transfer funds entirely in to 'secured fund' . This is for all three ie for the conservative, the moderates and also for the aggressive. 
  The RBI has raised the policy rates by a small margin but the bond prices are down and if you enter the secured fund now you also have a chance of appreciation in the bond values when the interest rates are revised downward and I expect it to happen after about six months from now. It is not that stocks have a bleak future but the risk-reward equation is at such point that the prudent investors keep funds in safe pocket and this applies more for the insurance and pension plan funds as they are for long term goals. My resolve is to advise you in way which takes care of safety as well as of decent growth. I am happy that this has been practically achieved since the time I began to advise you in these columns.
   The new plans have been introduced by companies as per the IRDA guidelines but what I find is that the charges like policy fee and fund management have been raised and the fund allocation charges in the first two years have been brought down. The fund-switching also will cost in future policies as against free switching for 24 times in a year in respect of plans sold to you so far. This makes the old plans worth more than gold, therefore please ensure that you keep paying the premium without fail and also keep topping up with every rupee that you save only on the ULIPs you already hold. You are aware that there is no withdrawal restriction or charge on your presently held policies (in a few cases the withdrawal is possible after three years, so check your policy issue date). Its only you who will have the cake and eat it too. 
  So, rejoice and enjoy your most valuable investment asset to the hilt. If you neglect to take full advantage, you are only going to damage the cause of fund growth and tax saving and hassle free management of funds.
Wishing you all the best,
Krishnakumar Khandelwal

ULIPs under regulation solely by IRDA

Dear Policyholders,
  The ULIP related controversy has ended with Govt of India issuing a notification regarding ULIPs that this product will remain under regulation solely by IRDA.You may recall that when the SEBI had tried to be spoilsport for the most successful product with Insurance Companies, I had given you the word of assurance that SEBI would not be successful in its attempt. In fact SEBI's move was in bad taste and it seemed to me that it was acting at the behest of some lobby but how can one surely say so. So, now when the ULIPs are not under cloud anymore, you should be making use of this wonderful product for your investment needs.
  I am happy to report the Growth Fund (Life) Unit's NAV has crossed 80 point mark on 21st June '10 . This is exactly 4 times the par value Rs 20 in Jan 04 when Nifty was at 2000 level. To have quadrupled the value in just 6 1/2 years is a remarkable feat. It translates in to return of almost 23% per year on compounded basis. Where else in the world such an achievement may have been made. This is superior to returns in any other asset class over the same period including Realty and Bullion.
  To further enhance your returns, I give fund switching advice from time to time which might have helped you. You may, however, master about the fund decision and my advice is no compulsion. You should be taking into account your own risk appetite and impressions about the possibilities before you resort to fund-switching. However, i am at your service at all times.
Krishna Kumar Khandelwal

Fund Switching Advice as on 26 May 2010

Dear Policyholders,
  You may have wondered as to why I have not addressed you about fund switching while the markets have been in turmoil of late. The reason is that on one hand I do not attach much importance to Europe's troubles as far as Indian equity markets are concerned and on the other is the fact the funds managers of HDFC SLIC have been doing a great job of taking the value of 'growth units' high even in the kind of market that we see today.
  As a proof of what said about unit values, I may point out to you that 'growth fund (life products) unit NAV was Rs 68.17 on 6 Nov 2009 when the Nifty was at 4800 level and the NAV of the same is Rs. 72.91 on 25 May 2010 when Nifty closed at 4806. This shows the clear advantage of about 6% ie Rs 4.71 per unit.
  Since the Nifty is not at an attractive level and scope of further slide is limited, I am inclined to give the following advice about fund switching:
A) the aggressives should now switch into Growth Fund entirely.
B) the moderates also should now come into Growth Fund entirely.
C) the conservatives should now have their investment in Balance Fund entirely.
  Those who have Wealth Maximiser products should invest in Large Cap Fund Mid Cap Fund.
  I hope you have had very handsome rewards for choosing to opt for HDFC SLIC's ULIPs . Those who have investible funds in hand may buy more such policies before 30 Jun 2010 as there would be longer lock in period for withdrawal of funds. Pension Plan would have no provision of early encashment and would be converted to annuity, however, one third of the corpus would still come to you in cash upon maturity.
  Please feel free for asking for matters specific in your own case.
  Thanking you,
Krishna Kumar Khandelwal

HDFC ULIP's Fund Performance

Dear Policyholders,

I have mostly sold ULIPs since HDFC SLIC introduced them in 2004. The returns for you all have been gratifying. These returns have come due to stellar performance of the Funds available to you for investment. The fund manager of HDFC SLIC deserve appreciation for their effort.

The 'Balanced Fund (Life)' has delivered returns of 16.52 % p.a. For last 5 years.

The 'Growth Fund (Life)' has delivered returns of 23.31 % p.a. For last 5 years.

The 'Defensive Fund (Life)' has delivered returns of 12.23% p.a. For last 5 years.

Those of you who have ULIPs and have been contributing regularly by way of premiums would have a fair idea how their own funds may have grown over the period (after life risk cover charges etc).

Those of you who have kept funds in 'Secured Fund' have also got more than what they would get in a fixed deposit with banks, it is also that no TDS is applicable on returns in Pension or Life plans of ULIPs. This makes ULIPs clear winners.

Those who have more investible funds may contact me at +919124313034 or write to me at khandelwal.kkinsurance@gmail.com for help in choosing a suitable ULIP. The charges on ULIPs have been reduced by HDFC SLIC and this is another advantage coming your way.

Krishna Kumar Khandelwal

Happy Diwali

Dear Policy Holders,

Wish you all Happy Diwali and a rewarding new year like the past one. All of you must have been pleased to see your fund grow back to level which is best in the whole time since the policy inception.

Who have paid premiums regularly in past twelve months have had more to gain. The once who have actively switched funds have yet more to be pleased about. Now it is an established fact that the ULIPs are the best, in good times or bad. The proof is before you, the worst period in time (for the investors) has been seen and there has not been any damage rather there have been gains.

I once again tell you that the policy you have can absorb more by way of contribution, most of you can access your funds for your needs, in full as well in parts, the amounts paid as premium qualify for tax saving and what is most of all benefits is that the gains remain tax free and would remain tax free even when withdrawn.

So what are you waiting for, you must put all your savings in to the policy as top-up premium, leave it there for as long as you don't need funds and take out when you need it. Does it not defeat the Fix Deposit option in terms of convenience of liquidity without cost and does it not beat it also for attracting no tax while interest on FDs will be subjected to TDS.

Further more, you have also what a Mutual Fund offers but at lower to nil cost and have ultimate flexibility and freedom of switching. You can see your policy detail on line and do switching on line (just obtain the client I'd and pass word). You may contact me for any further guidance at khandelwal.kkinsurance@gmail.com or phone up at +91972431304.

The SIP (systematic investment plan) is so much talked about but you must know that this is inherent in ULIPs. I would appreciate if you discuss your financial goals and what plans you have. I think I would be able to give you some useful guidance about how you can plug leakages and grow money fast, how you would have necessary cover and have tax savings.

Wish you all best once again for Happy Diwali

Krishna Kumar Khandelwal

Fund Switching Advice - 29 Oct 2008

Dear Policy Holders,

There has been a very bad fall in the world's indices and the volatility is continuing. My advice on 4 Aug 08 may have been followed and also my assessment of situation on 9 Oct 08 may have been seen. I am pleased that you may have had no anxieties during the period that followed. I may now tell you all to be only in 'Growth Fund' till further advice. There has been bench-mark interest rate reduction by banks all over the world. The Asian markets have therefore shown good upward move this morning while Indian market were closed.

As a further point that is in favour of the Equity preference is the fact that the HDFC SLIC fund managers are doing a good job. The Growth Fund Unit (ULEP/ULYS) has dropped by only 7.36% between 31/07/08 and 30/09/08 (from Rs 57.70 to Rs 53.45) while the NIfty lost 9.48% during this period (from 4332 to 3921). This trend is expected to continue and over the long term, it will add real value to your funds. Historically, between Jan 2004 when the Growth fund unit price was Rs 20/- has become Rs 38.47 on 29/10/08 (gain of 92%) while the Nifty has advanced from 2000 in Jan 04 to 2697 on 29/10/08( gain of 34.85%). The out-performance by HDFC SLIC is clearly evident.

As the market today is down due to excessive selling by FIIs and does not reflect the real strength which is far higher, it is the time when you may have extra advantage which is available only rarely.

I would invite the NRIs to come forward and have the savings and investments taken care of by HDFC SLICs policies along with meeting the risk cover requirements and tax shelter.

You are all welcome to send your financial particulars, present portfoio details, job details and family structure as also your aspirations and goals, I will send you a free written assessment of the same along with information about the required change etc. You will also know where you are incurring higher costs etc. and where the leakages may happen.

Wishing happy Diwali and prosperous new year,

HariOm,
Krishnakumar Khandelwal

HDFC Fund Peformance

Dear Policy Holders,

It is important for you to have an eye on the fund performance of the company relative to Index. I have tried to present before you some useful details about the fund performance of HDFC SLIC’s funds for life policies and pension policies over the last one year.

Fund		NAV 27.6.06	NAV 27.7.07	% age Return
Liquid
	Life	21.51	24.31	13.01
	Pension	21.51	24.31	13.01
Secured
	Life	21.28	23.01	8.1
	Pension	20.95	22.74	8.54
Defensive
	Life	25.75	30.01	16.54
	Pension	23.74	27.43	15.49
Balanced
	Life	31.1	38.69	24.4
	Pension	28.95	36.22	25.11
Eqity Managed
	Life	36.54	50.57	38.34
	Pension	34.55	46.07	35.01
Growth
	Life	42.74	61.7	44.36
	Pension	41.35	59.01	43.91
Nifty		3156	4445	40.84

You may note that the HDFC growth fund has actually managed to out beat the index by over 3%. This ability of the fund has kept you in safety against erosion in value and has given you higher returns. I hope you have followed the advice on the 25 Jul 07 and have stayed invested in secured fund.

Hari Om

Krishna Kumar Khandelwal

Success in Unit Link Insurance Plans as an ultimate alternative to traditional investing

Once the year is out, we look back to know where the returns have been bountiful and whether our own parking places have been rewarding enough. The following charts gives an idea but my contention is to tell you about the success in Unit Link Insurance Plans as an ultimate alternative to traditional investing. Those who kept their funds in growth fund have been able to get returns of 43.8%, the conservative ones have been able to get returns of 23.85 % by keeping funds in balanced fund and still more conservative have been able to get return of 14.96 % in through defensive fund ( with HDFCSLIC) during the year just out. These returns are tax-free and therefore have more value and HDFC SLIC has been able to out perform the indices and the peers by a wide margin. Now those who judiciously took efforts to switch funds at right time in right proportion were able to raise returns handsomely and kept themselves in safe waters. Have a look at the tablebelow:

Asset class				Returns
Art				104.08%
Gold				48.47%
Direct Equity
Sensex				42.30%
Nifty				33.90%
Equity Mutual Funds
Diversified
Best performer - Sundaram select midcaps				56.70%
ELSS
Best performer – Birla Tax Relief 96				40.70%
Balanced
Best performer – JM balanced fund				35.50%
Real estate: Premium Residential
Tier I & Tier II cities				15-20%
(Source: Narains Corp)
Debt
Bank FDs – Best rate				8%
Post office savings				8%
Debt Mutual Funds
Long term debt
Best performer – Pru ICICI Gilt Investment				9.70%
MIP
Best performer – Reliance MIP				14.40%
Floating rate
Best performer – LIC MF floating rate fund				7%

I invite my readers to extensively discuss the merits of the Unit Linked Plans. I would appreciate if you let know your precise financial goals and risk profile, I would be able to show to you how efficiently these goal may actually be achieved.

Wish you a year of all-round success and fulfilling times ahead,

Hari Om

Krishna Kumar Khandelwal