Historically, gold has been the perfect hedge for inflation. This is based on data from the year 1800 AD. But in terms of absolute returns gold has fared rather poorly giving returns at only 0.8% above inflation. Real estate and shares beat gold squarely on the capital appreciation front. Real estate and shares have given… Read More »
While deciding between the companies operating in the same sector, examine the rate at which the EPS of these companies has changed during the final two quarters and compare this difference with the rate of change of EPS during the last 3-5 years. If the EPS has shown an increase, it would mean the company… Read More »
What is the volatility of the fund? Remember in most instances funds with high returns tend to be more volatile. E.g. funds with mid-cap exposure and sector funds tend to be more volatile, but also offer higher returns. Also some fund managers tend to churn the portfolio in order to give higher returns, thus making… Read More »
Don’t let the money that you save lie around in your bank account. Keep a certain amount for an emergency and invest the rest in the best options for investment. You have to educate yourself about the options available. Try to increase your investments steadily every month.
An NRI must give careful thought to his investments in India. While mutual fund investments are not taxed in India, you may have to pay tax if you decide to go back to your native country. Also if you redeem your mutual fund investments, before one year, you end up paying short term capital gains.… Read More »
If securities are sold on the exchange within a period of one year of purchase, it is short-term in nature. Short-term capital gains are taxed at 15%. Short-term capital loss can be set off against short-term capital gain & long-term capital gains.
Our investments are heavily affected by inflation. Assume you have opened a bank deposit offering you 6% interest for one year. Now while closing the deposit account, if the inflation is 8%, you actually end up losing 2% (8-6). It means your investment has lost its value. In order to protect the value of your… Read More »
It is always important for you to understand your goals as well as your risk appetite. Don’t be taken in by the high returns offered by equities or gold if your goal is short term (within 2-3 years of investment), or if you cannot withstand the volatility of these assets. Similarly, just because income funds… Read More »
Be regular with your investment. It is best to allocate a portion of your funds from your monthly income and make arrangements to transfer it immediately to another account, from where you can plan your fund allocation for each investment. Do not use the bank account that you utilise for your day to day expenses,… Read More »
NAV or Net Asset Value is the aggregate of the market price of all the shares contained in the portfolio, inclusive of cash after deducting the liabilities divided by the sum of units issued. It can also be called the book value of the unit of the fund. Learn all about it here.