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Forgetting about investments can be a blessing! At least this is what Goa MFD Celso Fernandes of Nave Marg Financial Consultants says after the value of money of one of his clients who forgot about his investment crossed the Rs. 1 crore mark in just nine years!
Talking to Cafemutual, he shares with us the details of this real-life story that shows the power of compounding and the benefits of staying invested for a long time in mutual funds.
The client had started his first SIP in 2008 of Rs. 10,000 in a mid cap fund when the NAV was Rs. 11. Thanks to his disciplined approach and guidance of the MFD, he continued his SIP for 5 years till 2013. By then, the NAV of the fund had reached Rs. 17. Over this 60 months period, he invested Rs.6 lakh.
However, the client moved to Kuwait and could not be contacted by the MFD physically or on phone or email.
Busy in his daily routine, the client completely forgot about this investment. However, when he came back to India in 2022, he approached Celso to enquire about his first SIP.
To the utter amazement of everyone involved, the investment value of SIP investment had crossed the Rs. 1 crore mark by then. Seeing the exemplary performance, the client continued his investment.
Today, the value of this investment has reached Rs.1.40 crore. Recently, the client decided to set up an SWP of Rs. 1 lakh every month with this investment.
Celso, who also forgot about the client after making attempts to contact the client for some time, calls this case study the eighth wonder of the world i.e. the power of compounding through mutual funds. Celso says this case study exemplifies the ‘The power of forgetting’.
Learning from this miraculous case, Celso recommends MFDs to ask investors to continue investing irrespective of market conditions and encourage them to stay put for long term. He also advises MFDs to promote step up SIPs whenever the market gives their clients an opportunity to accumulate more units.
