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Sensex Rolling Returns

"In the short run the market is a voting machine. In the long run it is a weighing machine."

- Benjamin Graham

The aforesaid clearly describes the nature of equity markets over different time periods. In the short run markets respond to the noise of investor emotions like fear and greed, are driven by factors that are far removed from fundamentals. However, in the long run markets tend to be driven solely by fundamental factors such as economic growth, corporate performance etc.

When we invest in equities, the first question that comes to any investor’s mind is what can be his / her expected returns? Although, there is no fixed formula to arrive at the returns over a period of time, HDFCMF’s Sensex Rolling Returns Calculator will give an investor a far more accurate picture on performance of equities over different time periods.

The calculator clearly demonstrates that over the short to medium term, the returns from equities tend to be volatile. However, over the long term they become surprisingly predictable.

How the calculator works

Select the evaluation date. On selection, the table shall show the returns of the Sensex during different time periods ranging from 1 to 15 years. It will also show the returns had you considered the investment a year later after the selected evaluation date and so on and so forth. For eg. If the evaluation date entered is January 1, 1985 then the calculator will also show the returns for a period 1 to 15 years hence. Similarly it will also show the returns for the same period had you invested on January 1, 1986 and onwards. What the table reflects is the range of returns for different time periods say 1 year, 3 year and upto 15 years.
Please select the evaluation date from 03 Apr 1979 to 06 Sep 2009 and read below for the analysis and summary of observations.

Summary of Observations

		Returns (%)
Date	SENSEX	1 Year	3 Years	5 Years	7 Years	10 Years	12 Years	15 Years
06 Sep 1995	3348
06 Sep 1996	3508	4.77
05 Sep 1997	4032	14.94
04 Sep 1998	2975	-26.22	-3.86
06 Sep 1999	4833	62.43	11.27
06 Sep 2000	4606	-4.68	4.54	6.59
06 Sep 2001	3203	-30.48	2.49	-1.81
06 Sep 2002	3141	-1.92	-13.38	-4.87	-0.91
05 Sep 2003	4369	39.10	-1.75	7.99	3.19
06 Sep 2004	5246	20.07	17.88	1.66	3.83
06 Sep 2005	7947	51.48	36.26	11.52	15.07	9.03
06 Sep 2006	11933	50.16	39.78	30.09	13.78	13.02
06 Sep 2007	15616	30.86	43.85	37.82	19.05	14.50	13.69
05 Sep 2008	14484	-7.25	22.15	27.09	24.06	17.15	12.54
04 Sep 2009	15689	8.32	9.55	24.49	25.83	12.50	11.99
06 Sep 2010	18560	18.30	5.93	18.49	22.95	14.95	16.48	12.09
Yearly Rolling Returns		15	13	11	9	6	4	1
Negative Returns		5	3	2	1	0	0	0

Summary since 06 Sep 1995

	Time Period
	1 Year	3 Years	5 Years	7 Years	10 Years	12 Years	15 Years
Yearly Rolling Return Observations	15	13	11	9	6	4	1
Negative Return Observations	5	3	2	1	0	0	0
Loss Probability (%)	33	23	18	11	NIL	NIL	NIL
Median Return (%)	15	10	12	15	14	13	12
Average Return (%)	15	13	14	14	14	14	12
Max Return (%)	62	44	38	26	17	16	12
Minimum Return (%)	-30	-13	-5	-1	9	12	12
Standard Deviation (%)	28	18	14	10	3	2	0

To conclude, the longer you remain invested in equities

Lower is the probability of loss
The volatility of returns reduces
The returns from equities become predictable

The Sensex Rolling Returns Calculator lets you see for yourself that while there is a risk of negative to low returns in the short to medium term due to the volatile nature of equities, you are likely to achieve superior returns over the long term.

Past Performance of the SENSEX may or may not be sustained in future.

Note :
The base year of SENSEX is 1978-79 and the base value is 100.
Please visit www.bseindia.com for the SENSEX calculation methodology

Please click HDFC Equity/ Growth Funds for details on Equity-oriented Funds of HDFC Mutual Fund.

Disclaimer :
This calculator is made available to you as a self-help tool for your independent use. HDFC Asset Management Company Limited/ HDFC Mutual Fund is not forecasting any returns. The Calculator alone is not sufficient and shouldn’t be used for the development or implementation of an investment strategy. BSE SENSEX returns calculated above are not related to any of the returns of HDFC Mutual Fund Schemes. HDFC Asset Management Company Limited/ HDFC Mutual Fund/ Sponsors and their affiliates are not liable for any financial decisions arising out of the use of this calculator and also they do not take the responsibility, liability, for any error or omission or inaccuracy or for any losses suffered nor undertake the authenticity of the figures calculated on the basis of this calculator.

Know Your Client compliance is compulsory for all investments of Rs. 50,000 and above

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