RBI Retail Direct Scheme allows retail investors to buy and sell government securities online both in the primary and secondary markets. According to details provided by RBI, small investors can now invest in G-Secs by opening a gilt securities account (Retail Direct Gilt or RDG Account) with the RBI. The article looks at our takeaways in terms of pros and cons and how you can go about executing this mode of investment
Many people are still hung up on trying to time the market. Should I exit now… Is the sensex too high? Is it over valued? Are we looking for a big drop soon? Should I leave and enter again post the correction? To really examine if there is a case for timing the market, we analysed the performance of the Sensex by day for the last 30 years and came up with some astounding data. It looks like time in the market beats timing the market hollow.
The latest unicorn to hit the IPO circuit is Zomato and much has been written about how the company is not garnering profits and has accumulated losses. Is there merit in relooking at the strategy that Zomato must be following? Are we losing out on a good opportunity or is it just the euphoria in the market?
Sometime in August, the finance minister allowed time up to September 15, 2021 for removing all the glitches and errors from the new income tax website. As the due date approaches, there will be a significant increase in the website traffic with more and more users logging to file their returns. How will the website cope with heavy number of users and what exactly are we hoping to get from the new website?
When the US fiscal deficit was high AND when the US debt to GDP was high AND when the US printed money abundantly, gold performs better. This was the situation in between 1970-80, 2000-2011. Today we are seeing a gold run again. The current situation is familiar- US debt to GDP is high and the US Fed is printing money every day and gold should do better as per historical patterns. But based on the past 10-year historical returns, investors are still skeptical about adding gold. The article looks at how safe is it invest in gold and in what proportion?
The primary aim of investing is to grow our money and make it work harder for us. That means firstly focusing on avoiding negative returns, keeping funds safe and only then planning for gain and alpha returns. Diversification is what helps to grow money with a lower risk of losing. A portfolio that is well-constructed not only ensures participation during market rallies, but also helps in downside protection. A key step to building such a portfolio is to diversify across asset classes. It doesn’t just mean holding on to too many schemes. The article looks at how we can go about diversifying our investments meaningfully.
Equity should only be a part of our investment in a holistic financial plan. During a shock, look at the plan and investments holistically. The entire focus cannot be on the negative return on equity only. It is in fact the right period to start evaluating buys when everyone is selling. Value investing is highly underrated. But with a financial plan and advisor showing you the way, you can remain calm and reap diligent rewards.
With the magnitude of its impact globally, Covid 19 brought in a lock-down and change in ways of life as we knew it. Something that we had never experienced before. Uncertainty fuels fear and panic nudging the market to correct in anticipation of future losses. Look at the consequences and actions that we should emulate to minimize the overall impact on our financial health and therefore goals.
Some investors clearly understand the markets so well and ride all the waves and storms and come out winners. Perhaps the only way to understand this is ‘experience’. But what are the steps to gaining this experience. It is tough for a new investor in equities to understand shocking corrections. The article looks at how the cycle of knowledge and experience play out over time for investors.
Returns on debt related investments and FDs are comparatively low and are steady – around 4% to 6% per annum today. But these returns are usually lower than the inflation rate. It is but natural therefore that we want higher returns than FDs and so we invest in other investments such as equities, gold, real estate, etc. The article looks at catches and risks which we must understand clearly and also accept if we want these higher returns.
