Delayed gratification is making sacrifices now to enjoy the benefits later. Delayed gratification is worth discussing in an age where instant gratification is the norm, not the exception. Delayed gratification feeds into the ability to manage your finances in a better way. It can control the gambling instinct, the decision to persist with your savings strategy when the market is collapsing, the resolve not to compete with the neighbours or social circle, the discipline to save for your retirement. It can yield tremendous returns if you can exercise self-control and tolerance for waiting. David Laibson, an economist at Harvard University, […]

Maslow’s fourth level need on esteem indicates the need for recognition on wealth, position and power. In fact, these needs are double edged swords and act like salt in a curry. Excess of it brings unhappiness rather than happiness. I got its validation at a Satsang; “The loser in an undesirable ego battle is happier than the winner”. This has been my secret in being happy in the housing society I live. Social comparison is an innate human tendency. On the one hand, it can fuel motivation and on the other it can bring jealously. The assessments are not evaluated […]

Investment author Jonathan Burton puts forth the Golden Rule of Investing” Don’t be overconfident.  Every investment mistake is rooted in overconfidence”.  In his book Thinking Fast and Slow, Nobel laureate Daniel Kahneman called overconfidence “the most significant of the cognitive biases.” He also holds the view that the most damaging of biases that plague an investor is overconfidence. He said “it is the bias he would most like to eliminate if he had a magic wand. But it is built so deeply into the structure of the mind that you couldn’t change it without changing many other things”. It has been described […]

AMCs  are  permitted to charge  expenses  upto a  maximum of  2.25% in case of Equity funds and 2% in case of Debt funds. But some AMCs were charging higher expenses.SEBI had instructed the AMCs to reduce the expenses ratio effective from 1st April 2019 and the AMCs have reduced the expenses .The expenses of some of the  schemes in   case  of both   Regular plans  and Direct Plans effective 5th April 2019 are as follows.AS may be observed the difference between regular and Direct Plans are commission paid to the Distributors (Banks and Individual agents)

The role of women in the society is changing. The number of educated girls are increasing and they are coming out with flying colors in the competitive examinations. They are now career oriented and venturing into areas which were once upon a time were dominated by males. It has provided them with opportunity for financial independence. It is high time women participate in Family’s financial decisions for the following reasons; (1)   More life to live- In old age; women largely depend financially on their spouses. But, with life expectancy of women being higher than men, it is advisable to put in place […]

Investors are becoming more aware of Mutual Fund Direct Plans. Investment into Mutual Funds (MFs) can be done in two ways:- Regular Plans whereby a certain ‘expense ratio’ is charged by the mutual fund company ( ie, the AMC – Asset Management Company), as a percentage of the value of your fund, which includes the fee of the AMC as also some fee of the Adviser who is managing your portfolio. Thus, it is a bundled option. The fee of the Advisor is directly credited by the AMC to the Advisor after it has been charged to you. So, the expenses charged […]

2018 will be remembered for volatility; Crude Oil prices, Rupee-USD rate and Equity market. The sensex has seen it on many occasions earlier: During 1987 it fell 16% and gained 51% next year; it fell 16% in 1998 gained 64% next year; it rose a meagre 4% in 2002 and gained whopping 73% next year; it corrected 52% in 2008 and gained  81% next year; it fell 25% in 2011 and gained 26% in 2012; it rose a meagre 2% in 2016 but gained 28% in 2017. Whenever sensex provides negative or low return, it is followed by a higher […]

The market regulator SEBI has urged investors to deal only with SEBI Registered Investment Advisers(RIAs)  to avail investment advisory services. In fact, the market regulator has urged people to look at the list of SEBI RIAs on its website before availing investment advisory services. Further, SEBI has advised investors to pay advisory fees through banking channels such as NEFT, IMPS or cheque and maintain the duly signed receipt with details of payments. As on May 2018, the total number of SEBI RIAs was 918 throughout the country. Of them, over half of them are individuals. Do’s while dealing with Investment […]

Regular and Direct Mutual Fund Products  The Mutual Fund AMCs design regular products factoring two components; i.e. the management expenses and the commission. When the investors buy Regular MFs; the embedded Commission in it is passed on to the Distributors and Banks. It is like selling branded medicines. But now SEBI has directed AMCs to design Direct MF schemes without the commission in it. It is like generic medicines. These are transparent and the investors do not pay for the Commission component. These are not offered by the Distributors and Banks but by the SEBI Registered Investment Advisers (RIA).There is an element of […]

SEBI has directed all the Fund houses(AMCs) to recategorise all their schemes into 36 categories from 30th June 2018 ; Equity(10),Debt (16),Hybrid(6),Solutions(2) and others(2). As a consequence, the names and strategies of many schemes have undergone changes. It is quite challenging for the investor to assess and select the schemes based on historical returns and ratings. Retail investors who have invested earlier based on historical parameters will, all of a sudden, find that some good schemes selected by them are no more doing well. It will be advisable to seek the help of a professional and preferably, a SEBI investment […]