The benefit of Value Cost Averaging (VCA) over Rupee Cost Averaging(SIP)

http://www.myiris.com/financial/storyShow.php?fileR=20120531161627715&dir…
Source: IRIS (31-MAY-12)

The basic tenant of investing is buying low and selling high. However, this principal, is often never put to use, because fear, greed are stronger than long term investing discipline.

What is even sadder is the public, normally buys at highs and sells at lows, which grossly undermines returns and the investor, ends up loosing money and not being happy with the investment decision or the financial planner.

NAV Rs 10 or Rs 100, which one is cheaper

There is no such thing that is costly or cheap NAV.

I decided to invest in mutual funds. There were two choices before me; Fund A with an NAV of Rs 13 a unit and Fund B with a NAV of Rs 22 a unit.

Was Fund A a better choice because it was cheaper? This is a question which plagues many first- time investors in mutual funds.

Four Mistakes to Avoid in market crash.

Four mistakes to avoid in a market crash. Don’t hit the panic button and take hasty decisions. Sit back and think long term to reap adequate returns There is no denying that western countries are in the midst of a serious financial crisis, the effects of which are being felt in our capital markets too: […]

Use corrections to enhance equity portfolio.

Use corrections to enhance equity portfolio The S&P 500 index corrected 4.84% in the two trading sessions just gone, on the back of an announcement downgrading US’ sovereign debt. The Indian equity market followed suit with the S&P Nifty index correcting 4% in the last two trading sessions. These are extraordinary times: the global economy […]

Realign Portfolio and continue SIPs STPs

Realign portfolio; continue SIPs, STPs The stock market has been on a roller coaster all year. While in the short run markets mostly overreact both ways, over a sufficiently long period of time, if the economy is growing, the broad index rises above the inflation rate. Investors who enter the market for the short run […]

What PMS is all about!

There is a hilarious mail exchange a friend forwarded me between him and his portfolio management scheme (PMS) “relationship manager”. Friend invests money five years ago and forgets about it. 2011 tax time approaches and he pulls out the PMS to see how it did. Where did my Rs.8 lakh reach after five years of cooking? Rs.9 lakh? Shock and disbelief. It grew 0.87% a year! Does a quick check and finds that the Sensex grew 10% a year over that period. Asks PMS “relationship manager” what happened. PMS manager (I swear I am not making this up) says: look carefully, we actually gave a return of 4.62% per year. You get the figure of 0.87% because the difference is our charges. For managing your money, you see. I’ve advised friend to ride the bus called a mutual fund (buy out of the Mint50 list) and forget about these get-rich-quick PMS schemes. At least he got his money back. His other story… OK, OK, another time.

FMPs and why.

Come March and apart from equity-linked saving schemes, there’s another mutual fund (MF) scheme in the tax-friendly genre that offers an attractive proposition to make money—fixed maturity plans (FMPs). As of now, there are several of them on offer (to see full list of FMP new fund offers, or NFOs, go to www.livemint.com/fmps.htm). Most of […]

Market update and what you should do Feb 2011.

Dear Investor, Many of you would be wondering what is happening with the current market and what should be done with your investments. Pl read on… Equity Market update. While the Indian equity markets (BSE Sensex) ended the last month of the calendar year 2010 on a positive note (by gaining 987.8 points or 5.1%), […]