Gulaq Gear Selector

This template helps you calculate the desired annualised return and your chances of success, based on your investment preferences. Enter a few key variables and the template gives you output for decision-making.

Inputs

1. Gear level (1 to 6)

• Gear 6 — 100% Equity, 0% Debt — Aggressive
• Gear 5 — 80% Equity, 20% Debt — Moderate to Aggressive
• Gear 4 — 60% Equity, 40% Debt — Moderate
• Gear 3 — 40% Equity, 60% Debt — Conservative to Moderate
• Gear 2 — 20% Equity, 80% Debt — Conservative
• Gear 1 — 0% Equity, 100% Debt — Ultra-Conservative

The gear level corresponds to your desired equity exposure — Gear 6 is the most aggressive (100% equity) and Gear 1 the most conservative (fully debt-based).

2. Investment horizon (1, 3, 5, 10 years)

The time period for your investment: 1, 3, 5 or 10 years.

3. Investment amount

The amount you plan to invest.

4. Expected amount

Your desired amount at the end of the horizon. The template uses this to calculate the expected annualised return and chances of success.

Outputs

1. Desired annualised return (%)

The rate of return required each year to reach your desired amount by the end of the period:

Desired Annualised Return = (Desired Amount / Investment Amount) ^ (1 / Investment Horizon) − 1

2. Chances of success

Calculated using historical return data — the Sensex (as a proxy for equity) and FD returns (for debt). For each horizon (1, 3, 5, 10 years) there is a table of historical returns for each gear level, arranged in ascending order to create a percentile ranking. The template matches your desired return to the relevant historical series for your chosen horizon and gear, then computes its percentile ranking — that percentile is your chance of success (the probability your desired return is achievable based on history).

Data assumptions

• Equity returns — the Sensex is used as a proxy for historical equity returns.
• Debt returns — FD (fixed deposit) returns are used as a proxy for debt returns.

These proxies let the model simulate historical performance and give a probabilistic assessment of your desired returns.

How to use

1. Select your gear level (based on the equity exposure you're comfortable with), choose your horizon, and enter your investment amount and desired amount.
2. Review the output — the desired annualised return and your chances of success show how realistic your expectations are, based on historical performance.