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 […]

If you want to file your Income Tax return on your own, you can do it; 1. If you are a first-time return-filer, register yourself on the income tax department‘s official e-filing portal www.incometaxindiaefiling.gov.in. Your permanent account number (PAN) acts as your user ID. 2. Keep key documents handy, including the Form 16, Form 26AS (tax credit statement), bank statements, copy of return filed last year, capital gains statement from mutual funds and brokers. 3. Go to the ‘Download’ tab to download the ITR preparation software (JAVA or Excel utility) for the relevant assessment year (Current one is 2018-19). 4. […]

More than 80% of investments of Individuals are in real estate and around 10% in Gold and Silver. The remaining are in financial assets i.e Bank Deposits, Insurance and Mutual Funds etc. Currently the appreciation in real estate prices has stagnated and so also in gold. So physical assets no more  provide better return than the financial assets.In financial assets the equity as an asset class has outperformed  other financial assets. The reduction in the interest rate of Bank Deposits has caused a lot of concern for retired people. Approach by Individual Investors An individual investor should look at the […]

SEBI Registered Investment Advisers (RIA) provide right financial advice and act in clients’ interest. RIAs are like Financial Doctors and are different from Distributors and Banks. RIAs focus more on advice where as Distributors including Banks focus more on products; just  like selling medicines. Regular and Direct Mutual Fund Products  The Mutual Fund AMCs design regular products factoring two components; i.e. the price of the product 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 […]

Creating and managing a portfolio by the investor requires investment decisions to be made on which asset classes to invest in, how to invest, timing of entry & exits and review & rebalancing the portfolio. These decisions have to be based on the analysis of available information so that they reflect the expected performance and risks associated with the investment. Very often the decisions are influenced by behavioral biases, which lead to less than optimal choices being made. Some of the well documented biases that are observed in decision making are;  Greed and Fear These are the most common biases […]

Traditionally women are better at managing family’s budget and are more concerned about children’s education and marriage. We find women groups take to streets when prices of vegetables and other essential items increase beyond tolerable levels. Nowadays increasing number of women are opting for career in regular jobs. It provides them opportunity for financial independence. It is high time for women to take control of their finance for the following reasons; (1)   Increasing divorce rates – India is witnessing a surge in divorce rates and therefore entrusting the spouse with financial matters can create money crunch. It is prudent to keep a […]