2014 - A good year for financial assets

2014 has a good year for financial assets. Investments in Equities including equity mutual funds and in debt – debt funds and fixed deposits have beaten inflation. Unless you had all you money in gold or gold funds, you have beaten inflation. Gold Funds gave a –ve return -6.10% as per Value Research.

This is a good time re-allocate you assets as per you financial plan. I am a firm believer in investing only according to a plan. Random investing to go along with the tide may be counter-productive in 2015. For 2015, stick to your plan and asset allocation. 

Debt

The returns from debt funds – have all beaten inflation. By November, WPI inflation was at 0 and CPI inflation at 4.38.

Given below is the performance of Debt Funds. Fixed deposit rates were about 9.00 – 9.50 % at the beginning of the year for deposits of > 3 years and those who had invested in debt / deposits have down well. The 8.75% returns for PPF and EPF in addition to beating inflation are tax-free. So we have had a year in which even debt has beaten inflation.

Debt – Income Funds	12.82
Debt – Short Term	10.49
Debt – Ultra Short Term	9.16
Gilt Funds – Long/Medium	16.40
Liquid Funds	8.76

Equities

Equities, especially mid-caps and small-caps, were the toast of the market. The BSE small-cap index was the top gainer at 66 per cent; the mid-cap index rose 51 per cent. The key benchmark indices, Sensex (on the BSE) and Nifty (on the National Stock Exchange), rose 29 and 30 per cent, respectively. These gains were despite about 2,000-point drop in 13 trading sessions between November 28 and December 17.

The below picture from the Business Standard gives a great snapshot.

Source: Business Standard

Returns from equity mutual funds - it has been good for Mutual Fund investors

Equity Large Cap Funds	34.69
Equity Mid and Small Cap	72.29
Equity Multi Cap	50.91
Equity ELSS	49.08
Hybrid Equity Oriented Funds	38.95

 However, international equity funds did not fare well and returned on an average 2.61% only. 

Gold

This picture from the Mint gives you a snapshot of how gold performed.

Real Estate:

It is difficult to analyse how real estate fared. However as per the NHB Residex, the performace this year hasn't been too great. While some pockets in some cities have fared well, overall real estate has not given the expected results this year. With piling inventory and stagnating sales, it remains to be seen how real estate will fare. See the below pic from the Business Standard. 

Finally, do your re-allocation now and keep investing systematically.