7/18/2017

Over--Ruled
Over

Art of handling objections

anchoredge.in

Objection Overruled

Have the in-depth knowledge about the

product.
List down the objections and the logical
answers to each objection.
Make client feel that you are in his team
and not opponent.
Acknowledge, validate and praise the
client for the objection.
Listen carefully before jumping into the
argument.

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Common
Objections
While selling
Equity Funds

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Objection # 1

Equity Markets are

RISKY, I want Safety
First.

Can you give guarantee like

Bank FD?

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 7/18/2017

Is your money safe in locker?

After 10 Years

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Inflation will eat your money

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Rupee Saved is not Rupee Safe

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Real Return

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Profit or Loss?

1,20,000

1,00,000
1,00,000
FD return assume 7.5%
80,000
HH exp getting Doubled
Every 5 years
60,000 51,526

40,000
25,000
20,000

0
HH Exp Today HH Exp After 10 Yrs FD value after 10 years

anchoredge.in

Ostrich Mentality

When Ostrich is afraid, it will burry its head in the

ground, assuming that because it cannot see, it can not be seen.

Ostrich FD Investor

Both of them feel that they are safe.

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Case Study Retirement Planning

Name Raj Sharma - Age 35

Retirement Age 60 Years

Life Expectancy 80 Years
Current Monthly Expense 25000
Inflation 8%
Post Tax Retirement 9%

Monthly Expense at retirement 1,71,212

Corpus Required for the Retirement 37,699,209

anchoredge.in

Case Study Retirement Planning

Age Year Opening Balance Expense Withdrawal Balance after Withdrawal Year End Balance

61 37,699,209 2,054,543 35,644,666 38,852,686

62 38,852,686 2,218,906 36,633,780 39,930,821
63 39,930,821 2,396,418 37,534,402 40,912,498
64 40,912,498 2,588,132 38,324,367 41,773,560
65 41,773,560 2,795,182 38,978,377 42,486,431
66 42,486,431 3,018,797 39,467,634 43,019,721
67 43,019,721 3,260,301 39,759,420 43,337,768
68 43,337,768 3,521,125 39,816,643 43,400,141
69 43,400,141 3,802,815 39,597,326 43,161,085
70 43,161,085 4,107,040 39,054,045 42,568,909
71 42,568,909 4,435,603 38,133,306 41,565,304
72 41,565,304 4,790,452 36,774,852 40,084,589
73 40,084,589 5,173,688 34,910,901 38,052,882
74 38,052,882 5,587,583 32,465,300 35,387,177
75 35,387,177 6,034,589 29,352,587 31,994,320
76 31,994,320 6,517,356 25,476,964 27,769,890
77 27,769,890 7,038,745 20,731,145 22,596,948
78 22,596,948 7,601,845 14,995,104 16,344,663
79 16,344,663 8,209,992 8,134,671 8,866,791
80 8,866,791 8,866,791 0 0

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Years to Save 25 Retirement Corpus needed 3.76 Cr.

Expected Return 8% 12% 15% 18% 20%

Monthly Investment
49,550 26,630 16,444 10,069 7,241
required

Power of compounding is the 8th wonder of world.

Not investing into the Equity may be more risky.

anchoredge.in

Case Study Child Education Fund

Parent : Anil Kumar / Child Name : Samir

Child Age 5 Years

Higher Education Age 18 Years
Current Education expense 10,00,000 Rs.
Inflation 8%

Expected Education cost

(after 13 years) 27,19,623 Rs.

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Case Study Child Marriage Fund

Years to Save 13 Childs Marriage Fund Required 27.19

Lacs

Power of compounding is the 8th wonder of world.

Not investing into the Equity may be more risky.

anchoredge.in

Case Study Child Marriage Fund

Parent : Anil Kumar / Child Name : Samir

Child Age 5 Years

Marriage Age 25 Years
Current Marriage expense 20,00,000
Inflation 8%

Expected Marriage cost after 20 years 9,321,914

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Case Study Child Marriage Fund

Years to Save 20 Childs Marriage Fund Required 93.21

Lacs
Expected Return 8% 12% 15% 18% 20%

Monthly Investment
16,278 10,134 7,024 4,838 3,765
required (Rs)

Power of compounding is the 8th wonder of world.

Not investing into the Equity may be more risky.

anchoredge.in

Objection # 2

Market is very High,

It should correct.

I will wait for correction.

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Behavior Gap
People who constantly try to
time the market end up getting
lesser return than the actual
asset class performance
Major returns in equity market is
delivered in few days.
Risk of missing Best Days
Valuation as on 14th July 2014 of Rs 100000 invested for 10 years
Product
Sensex
Birla Sun Life Equity Fund
7/18/2017
By constantly trying to time the
market, chances of losing those
few days are very high.
World is waiting for market to
crash, market is waiting for your
passion to crash.
anchoredge.in
Current Impact of Best Days missed
Value
2 days 5 days 10 days 20 days 30 days 40 days
524,199 412,801 337,181 251,906 149,353 95,781 65,713
769,417 611,452 512,141 388,639 251,137 173,938 125,811
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What if you missed BEST days?

Sensex Birla Sun Life Equity Fund

8,50,000 8,50,000
7,69,417

6,50,000 6,50,000 6,11,452

5,24,199 5,12,141
4,50,000 4,12,801 4,50,000 3,88,639
3,37,181
2,51,906 2,51,137
2,50,000 2,50,000 1,73,938
1,49,353 1,25,811
95,781 65,713
50,000 50,000
Current 2 days 5 days 10 days 20 days 30 days 40 days Current 2 days 5 days 10 days 20 days 30 days 40 days
Value Value

Value of Rs 1,00,000 invested before 10 years*

*as on 14th July 2014

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Objection # 3

Let us withdraw our money, as

market has corrected and I
FEAR that market will correct
further.

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anchoredge.in

Every BULL run has witnessed Corrections

Corrections during Bull Market of 2003-2007

There were around 5 Correction of

more than10% of magnitude during
the journey of Sensex from 6k to 21k.

The Biggest one was of 30% DIP.

Corrections are not predictable, we

should not waste time in worrying.

Keep investing, Because..

"Far more money has been lost by investors preparing for corrections, or
trying to anticipate corrections, than has been lost in corrections themselves.
Peter Lynch
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Time Is More Important

Name Mr. Sharma Mr. Mehta GREAT MOMENTS IN

Investment Started at Age 19 26
SCIENCE:
Annual Investment 50000 50000
EINSTEIN DISCOVERS
Investment continued till Age 25 65
Investment Held till age 65 65 THAT TIME IS ACTUALL
Total Investment 350000 2000000 MONEY.
Wealth At age 65* 52572371 42957119

60100000 52572371

50100000 42957119

40100000

30100000

20100000

10100000 350000
2000000 Wealth At age 65
100000
Total Investment
Mr. Sharma
Mr. Mehta

anchoredge.in
Total Investment
*12% rate of return Assumed
Wealth At age 65

Effect Of Compounding Vs. Time

The most powerful force in the

Value of Investment
universe is the power of
Compound.
15000/- Per month
Albert Einstein
Savings A/c Bank FD Equity Mutual Fund
No of Years
4% 9% 12% 15% 18%
2 3,75,390 3,95,773 4,08,648 4,22,032 4,35,945
5 9,97,800 11,39,847 12,37,295 13,45,225 14,64,868
10 22,16,110 29,24,485 34,85,086 41,79,859 50,43,863
15 37,03,662 57,18,657 75,68,640 1,01,52,946 1,37,88,133
20 55,19,958 1,00,93,440 1,49,87,219 2,27,39,325 3,51,52,308
25 77,37,650 1,69,42,955 2,84,64,526 4,92,61,106 8,73,49,682
30 1,04,45,444 2,76,67,111 5,29,48,707 10,51,47,309 21,48,79,338

anchoredge.in
Savings and Bank FD return is assumed at 4% and 9% respectively. For Equity MF various assumed return scenario.

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 7/18/2017

More Time = More Wealth

Its Not Timing Its Time

Into The Market Which
Is More Important.

Historically, those who

stayed invested with
their invested have
made big fortunes.

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More Time = More Wealth

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More Time = More Wealth

anchoredge.in

Emotion of FEAR

The feeling of FEAR is common

when market corrects.

Emotion of FEAR sometimes

overpowers the LOGIC.

FEAR leads to the irrational

decisions.

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anchoredge.in

TURNING POINT on Road is

PART of Road NOT END of it.

Similarly

CORRECTION in Stock Market

is PART of Stock Market NOT
END of it.

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Return After Correction

DONT MISS THIS

INVESTMENT
OPPERTUNITY.

ITS TIME TO ADD

MORE IN

anchoredge.in

Objection # 4

Let The More Clarity Come,

Then I Will Invest

WALL OF WORRY

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Market Doesnt Wait For Clarity

Market always reacts in advance.

It goes up or down before the actual event takes place.

Waiting for the clarity may result in paying the premium

and lesser returns.

So when odds are in favor of investment, dont wait for

the exact clarity.

People who were waiting for election to get over have

missed the rally of 6000 points in Sensex.

anchoredge.in

Cost Of Clarity

Period Market Indicator Wall of Worry Sensex

Modi appointed as BJP's PM
2013: Sept But there is infighting within BJP 19733
Candidate
BJP wins assembly election of 4
2013: Dec But these are only Hindi heartlands 21326
states
Opinion polls accord majority to But opinion polls were wrong in
2014: March 21920
NDA 2004 & 2009
But polarization of votes will
2014: April Heavy Campaigning by Modi 22702
happen
2014: But exit polls always
Exit Polls gives NDA majority 23551
Early may underestimates Congress
But BJP does not have majority in
2014: May BJP alone gets majority 24122
upper house

Market dont care for YOUR worries

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Objection # 5

I dont want to invest as the last

3 years returns are not good.

Every time I invest in Equity

Fund looking at performance,
but after my investments
scheme performance deteriorates.

Investing based on past performance only is as risky as driving a car

while looking into rear view mirror only.
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Rear View Mirror Past Performance

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Future Returns

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Objection # 6

Sentiments are not good,

just look at the NEWS.

National and International

Experts are predicting the
bear marketing

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Dont Act on Headlines

I think the worst mistake you can

make in stock market is to buy or
sell based on current headlines.

Warrant Buffet

anchoredge.in

Truth of Market Experts!!!

Nobody can
predict
the market.

Dont take
these experts
seriously.

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You Decide.

31st Aug., 2015

Are there any changes in

Indian Fundaments in
These 7 days which made
this smiling face so
serious??!!!

7th Sep., 2015

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You Decide.

Jim Rogers is Bearish on India since year 2002, when Sensex was around 3000,
Today Sensex Is 27000 points.
Should You listen to him?...... You Decide

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Truth Behind the Expert

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Objection # 7

No One Is Investing
In Stock Market
Right Now.

Dont Follow the

HERD.

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When To Invest?

Choice 1: When Market is cheap, attractive but no one wants to invest.

Choice 2: When Market is costly And everyone wants to invest.

Why we opt for 2nd Choice?

Investor's Decision Vs Feeling

Alone Group
Wrong Very Bad Not So Bad
Right Very Good Not So Good

What is more profitable: buying cheap or buying costly?

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Objection # 8

What if FIIs move

out of market?

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We think Achhe din aane WALE hai

FII believe Achhe din aa GAYE hai.

We are proud of our country and its economic power.

FII invest in our economic power and earn from it.

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Understanding FII/FPI

There are around more than 6045*

FIIs/FPIs as on 10th Aug 2016

All of them may not require the

money at the same time.

They come for the longer period of

time.

Over a period of time FIIs/FPIs have

increased their holding in Indian
companies.

*Sourec:https://www.cdslindia.com/publications/RegForeignInstInvstr.aspx

anchoredge.in

FII Inflow In Indian Equity Market

*as on 6th July 2017

Since last 10 years FII is net seller only in 2 full financial year.
FIIs are continuously buying the Indian Equity markets
On daily basis due to the huge volumes of FIIs market may be volatile,
but over long term FIIs are interested only in buying.

Source: https://www.fpi.nsdl.co.in/web/Reports/Yearwise.aspx?RptType=5
**up to Oct 8, 2016 anchoredge.in

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How have we done over time?

Holding in CNX
Type of Holding in NIFTY Holding in NIFTY Holding in CNX
500 March
Shareholder March 2008 June 2014 500 June 2014
2008

Promoter 54.95% 47.62% 58.47% 52.11%

Non Promoters

FII 16.05% 22.64% 14.59% 19.91%

DII 10.46% 11.92% 9.31% 10.33%

Public 8.20% 6.63% 8.36% 7.47%

Others 10.34% 11.19% 9.27% 10.20%

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What we Own?

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What we Own?

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Objection # 9

Markets are at
all time high,

It cant move up
further.

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Valuation Price vs Value

Sensex may be at all time high, but valuation are not.

One need to keep an eye the valuation measured by P/E ratio

to find out weather the markets are cheap or costly

P/E of market swings like pendulum from low to high

Current PE of market

anchoredge.in

Sensex Projection

Sensex Projection at 15% EPS Sensex Projection at 18% EPS

Growth yoy Growth yoy
Years 3 5 7 Years 3 5 7
EPS* EPS*
* 1364 2,074 2,743 3,628 * 1364 2,241 3,121 4,345
18 37341 49383 65309 18 40340 56169 78210
20 41489 54870 72565 20 44822 62410 86900
PE PE
22 45638 60357 79822 22 49304 68651 95590
24 49787 65844 87078 24 53786 74892 104280

Low PE 10.68
Historical
Average PE 18.31
PE movement
High PE 28.47
**As on 10th Aug., 2016 EPS Source:www.bseindia.com

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Objection # 10

I dont need Mutual Funds,

they also go down with
market.

I can do it on my own,
I am educated and intelligent.

anchoredge.in

Knowing Vs Doing

Just by looking at the picture,

I am sure you can understand
what the by pass surgery is ..

Now if you have understood

what the bypass surgery is,

If you or any of your

member suffer from
blockage of coronary artery,

WILL YOU DO IT YOURSELF?

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anchoredge.in

Being Intellignet

I can calculate the movement of stars, but not the madness of men.
Sir Isaac Newton anchoredge.in

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IQ vs. EQ

Newton lost his life saving of 20000 British pound in year 1720 trying on his own.
His loss is equal to approx Rs 18 cr. in todays context.

Do you think you are more educated and intelligent than Isaac anchoredge.in

Power of Professional Management

Value As Value As On Smart Investor, Additional

Investment
On (Panic (Confused Abs. Investment on 21st Sept
Particulars On
Investor) Investor) Growth 2001
14-Feb-00 21-Sep-01 23-Nov-04
25000 50000 100000
Sensex 5924.31 2600.12 6009.86 1.44%
HDFC Equity Fund 100000 51179 212360 112% 316094 419828 627296
Franklin Bluechip 100000 66222 202540 102% 279003 355465 508390
Reliance Vision Fund 100000 41240 255610 155% 410563 565515 875421
HDFC Prudence Fund 100000 71651 235370 135% 317494 399618 563865
Tata Pure Equity 100000 43927 182360 82% 286569 390509 598388
Franklin India Prima Fund 100000 45550 256670 156% 397543 538415 820161
HDFC Top 200 100000 46002 169780 69% 262048 354315 538851
ICICI Pru Diversified Power 100000 45433 221220 121% 342949 464677 708135
Reliance Growth Fund 100000 26818 221750 121% 428468 635185 1048620
Birla Sun Life MNC Fund 100000 58669 159099 59% 226894 294690 430281
Birla Sun Life Equity Fund 100000 32622 130636 31% 230749 330862 531087

Understanding something and doing something is all together different ball game.
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As on 31st May 2017

anchoredge.in

Objection # 11

I want to stop my SIP, because

the returns are not good for
Last 5 year

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Equity Investment - Game of Patience

You take a tiny seed, plant it and water it...you get a tiny
1 sampling.... nothing more
You water it, fertilize it.... the sampling stays as it is....
2 nothing happens
You continue to water it, take care of it...still nothing
YEARS 3 happens
Against your better judgment, you need to continue to
4 water it, fertilise it... and still nothing will happen
To everyone's surprise, the tree sprouts and grows NINTY
5 feet in SIX weeks

What was going on in first Few Years?

The tiny sampling was actually developing its root system underground to
sustain its impending over the ground growth fifth year onwards.
Chinese Bamboo tree If you had uprooted the sampling to see why it was not growing, it would die.
tests your patience But if you were patient and had faith, you would witness the miraculous growth
later on

INVESTING SIMILAR GAME OF PATIENTS

anchoredge.in

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SIP Stopped Vs SIP Continued

3 Years Return as on 17th Aug. 13 Return of same till 31stJuly 2016

Scheme Name (SIP Stopped) (SIP continued )

Total Total Present

SIP of Rs 5000 per month
Value CAGR CAGR
Investment Investment Value(SIP)

Birla Sun Life Equity Fund 180000 171787 -3.17 355000 628587 19.5
Birla Sun Life Mid Cap Fund 180000 164416 -6.11 355000 669618 21.69
DSP BlackRock Equity Fund 180000 166851 -5.13 355000 554171 15.16
DSP BlackRock Small and Midcap Fund 180000 159774 -8.00 355000 703808 23.42
DSP BlackRock Top 100 Equity Fund 180000 179842 -0.06 355000 519538 12.95
HDFC Equity Fund 180000 164718 -5.98 355000 540384 14.3
HDFC Growth Fund 180000 165589 -5.63 355000 516304 12.74
HDFC Top 200 180000 168967 -4.28 355000 525666 13.35
Kotak 50 180000 176727 -1.25 355000 550164 14.91
Reliance Growth 180000 163569 -6.45 355000 581245 16.8
Reliance Vision 180000 153723 -10.52 355000 534363 13.92
Sundaram SMILE Fund 180000 150503 -11.89 355000 732447 24.81
Tata Equity P/E Fund 180000 163176 -6.61 355000 628722 19.51

Normally average Investor stops SIP after 3 or 5 years

if returns are not good or negative anchoredge.in

SIP Stopped Vs SIP Continued

5 Years Return as on 17th Aug.13 Return of same till 31st July 2016
Scheme Name (SIP Stopped) (SIP continued )

Total Total Present

Value CAGR CAGR
SIP of Rs 5000 per month
Investment Investment Value(SIP)

Birla Sun Life Equity Fund 300000 326814 3.49 465000 979923 17.99

Birla Sun Life Mid Cap Fund 300000 330158 3.90 465000 1084507 20.49

DSP BlackRock Equity Fund 300000 332700 4.22 465000 880652 15.36

DSP BlackRock Small and Midcap Fund 300000 344293 5.62 465000 1211503 23.22

DSP BlackRock Top 100 Equity Fund 300000 351504 6.47 465000 809145 13.28

HDFC Equity Fund 300000 344709 5.67 465000 894725 15.75

HDFC Growth Fund 300000 333513 4.32 465000 820003 13.6

HDFC Top 200 300000 343043 5.47 465000 846769 14.4

Kotak 50 300000 336806 4.72 465000 847184 14.41

Reliance Growth 300000 319006 2.50 465000 912934 16.25

Reliance Vision 300000 291942 -1.11 465000 818157 13.55

Sundaram SMILE Fund 300000 291401 -1.18 465000 1164262 22.24

Tata Equity P/E Fund 300000 325948 3.38 465000 1011258 18.77

Normally average Investor stops SIP after 3 or 5 years

if returns are not good or negative anchoredge.in

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 7/18/2017

Dont invest in Schemes

based on Past Performance
only.

Consult your Financial

Advisor

Ask for Fund Selection

Parameters.

anchoredge.in

Past performance as on 23td June, 2014

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Objection # 12

I am already investing into PPF

for 80 and dont have further
scope of investing into the
ELSS.

anchoredge.in

PPF Returns

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ELSS Vs. PPF

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Comparison Of ELSS Vs. PPF

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Summary

anchoredge.in

Objection # 13

Why should I invest into regular Plan,

when I can invest into the Direct Plan
and earn more
anchoredge.in

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 7/18/2017

Direct Vs Regular Plan?

Most Investors choose the funds based on latest past performance,

which may or may not sustain into the future.

Fund Selection is not easy Job.

Average Equity Funds direct plan delivers 0.5% to 0.75% more

returns, while the difference between returns into the same category
of fund is very high.

Research across the globe says that those with the advisors create
much more wealth than those without wealth.

anchoredge.in

Fund Selection is childs play

As on 26th Aug 2015

As on 25th Aug 2016 anchoredge.in

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Fund Selection is childs play

As on 26th Aug 2015

As on 25th Aug 2016 anchoredge.in

Fund Selection is childs play

As on 26th Aug 2015

As on 25th Aug 2016 anchoredge.in

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Penny Wise Pound Foolish

As on 25th Aug 2016

Average Equity Funds direct plan delivers 0.5% to 0.75% more returns, while the
difference between returns into the same category of fund is very high.

anchoredge.in

Penny Wise Pound Foolish

As on 25th Aug 2016

Average Equity Funds direct plan delivers 0.5% to 0.75% more returns, while the
difference between returns into the same category of fund is very high.

anchoredge.in

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Penny Wise Pound Foolish

As on 25th Aug 2016

Average Equity Funds direct plan delivers 0.5% to 0.75% more returns, while the
difference between returns into the same category of fund is very high.

anchoredge.in

anchoredge.in

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VOFA Value of Financial Advice

anchoredge.in

VOFA Value of Financial Advice

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Objection # 14

Equity Cant Beat the

return from the Real Estate
Investments.

anchoredge.in

Perception Vs Reality?

Are the Grey Lines Straight?

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Perception Vs Reality?

Yes. The Lines are straight

Things are not always the way they appear to us.

anchoredge.in

Perception Vs Reality?

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Perception Vs Reality?

anchoredge.in

Case Study

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Case Study

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Case Study

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Perception Vs Reality?

Things are not always the way they appear to us.

anchoredge.in

Perception Vs Reality?

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