*Me:* When do returns acrrue to investors in equity markets?
*Fund Manager :* Front ended or Bank ended (and he ends his answer there)
I understand it this way……
_*Front ended returns*_ – _An investor’s returns are piled up during the first 3 or 4 years of investing & then, it’s always an average up or down. RETURNS STABILISE OFF, there after.
?? _*Works best with a Single One Time Lumpsum Investment*_
_*Back ended returns*_ – _An investor keeps on investing for a long long time & then, the miracle of all the Returns fall into the lap during the last 3 or 4 years of the holding period. RETURNS STABILISE OFF, there after.
?? _*Works best in a Systematic Investment Plan*_
Now…… _Most Investors expect something called, a _*LINEAR RETURN*_
_*Linear Returns*_ – Delivering a progressing return from one stage to next or from one year to the next year in a stable and consistent way.
?? _*THIS IS NON EXISTENT IN INVESTING*_
Investment Returns in equity are always this way ??????????????????????????????????
_*TIME IN THE MARKET IS THE HEALER*_