My Smart Investment "MUTUAL FUND"

2018-01-22T21:08:00.000-08:00

Rupee Cost Averaging

Rupee cost averaging is an approach in which you invest a fixed amount of money at regular intervals. This in turn ensures that you buy more shares of an investment when prices are low and less when they are high. By investing on a fixed schedule, you avoid the complex or even impossible duty of trying to figure out the exact best time to invest. The rupee cost averaging effect - averages out the costs of your units and hence lessens the results of short-term market fluctuation on your investments.

Getting started on a rupee cost averaging strategy

Decide on the amount you can invest on a regular and long-term basis
Select an investment you want to hold for the long-term
Invest at regular intervals (weekly, monthly or quarterly)

Aadhaar linkage with bank accounts mandatory, - RBI

2017-10-21T09:19:00.002-07:00

Mumbai: Reserve Bank of India on Saturday said biometric identity number Aadhaar linkage with bank accounts is mandatory.

The RBI clarification followed media reports quoting a reply to a Right to Information (RTI) application that suggested the apex bank has not issued any order for mandatory Aadhaar linkage with bank accounts.

"The Reserve Bank clarifies that, in applicable cases, linkage of Aadhaar number to bank account is mandatory under the Prevention of Money-laundering (Maintenance of Records) Second Amendment Rules, 2017 published in the Official Gazette on June 1, 2017," the central bank said in a statement.

These rules have statutory force and, as such, banks have to implement them without awaiting further instructions, it said.

The government in June had made Aadhaar mandatory for opening bank accounts as well as for any financial transaction of Rs 50,000 and above.

Existing bank account holders have been asked to furnish the Aadhaar number issued by the Unique Identification Authority of India (UIDAI) by December 31, 2017, failing which the account will cease to be operational, the government notification had said.

There were reports in media quoting an RTI query in which RBI had said it "has not issued any instruction so far regarding mandatory linking of Aadhaar number with bank accounts".

The government in Budget 2017 had already mandated seeding of Aadhaar number with Permanent Account Number to avoid individuals using multiple PANs to evade taxes.

The notification issued amending the Prevention of Money- laundering (Maintenance of Records) Rules, 2005, mandated quoting of Aadhaar along with PAN or Form 60 by individuals, companies and partnership firms for all financial transactions of Rs 50,000 or above.

Source

How Often To Review Your Mutual Fund

2017-10-20T23:25:00.001-07:00

One should avoid the temptation to review the fund's performance each time the market falls or jumps up significantly. For an actively-managed equity scheme, one must have patience and allow reasonable time - between 18 and 24 months - for the fund to generate returns in the portfolio.

The review may become more pronounced in case of thematic or sectoral schemes as they are more prone to the changing economic environment.

It is advisable for common investors to make a separate watch list of funds that are found to be underperforming their benchmark or their comparable peers. From this list, one should look for improvement in performance over the subsequent 2-3 quarters. A consistent under-performance over 3-4 quarters may warrant shifting the investment to other better options. One needs to even check the reason for the under-performance, which may be expressed in the fund manager's commentary. The underlying stocks in the portfolio of an MF scheme keep changing and along with it change the associated risks. An important factor is the risk metrics. If the risk profile of the fund has skewed further towards "High" risk while the returns remain the same or do down, it may be advisable to exit the fund.

Therefore, a review of the fund's risk-adjusted return, i.e., a measure to find how much return an investment will generate given the level of risk associated with it, could be more helpful.

Different Types of Mutual Fund in India (Part-1)
Different Types of Mutual Fund in India (Part-2)
Different Types of Mutual Fund in India (Part-3)

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How many years need to get your money Double (RULE-72)

2017-10-20T18:40:00.000-07:00

The 'Rule of 72' is a simplified way to determine how long an investment will take to double, given a fixed annual rate of interest. By dividing 72 by the annual rate of return, investors can get a rough estimate of how many years it will take for the initial investment to duplicate itself.

For example, the rule of 72 states that ,,₹1 invested at 10% would take 7.2 years ((72/10) = 7.2) to turn into ₹2. In reality, a 10% investment will take 7.3 years to double ((1.10^7.3 = 2).

When dealing with low rates of return, the Rule of 72 is fairly accurate. The above chart compares the numbers given by the rule of 72 and the actual number of years it takes an investment to double.

Notice that, although it gives a quick rough estimate, the rule of 72 gets less precise as rates of return become higher. Therefore, when dealing with higher rates, it's best to calculate the precise number of years algebraically by means of the future value formula.

Happy Diwali

2017-10-18T21:39:00.003-07:00

May the Divine Light of Diwali Spread into your Life Peace, Prosperity, Happiness and Good Health.
With a hope that you attain success and bliss
with every light that is lit
on the day of Diwali!

HAPPY DIWALI
Pradipta Kumar Dash

When should I start investing in Mutual Funds?

2017-10-11T22:49:00.001-07:00

There is a beautiful Chinese proverb, “The best time to plant a tree was 20 years ago. The second best time is now.”

There is no reason why one should delay one’s investments, except, of course, when there is no money to invest. Within that, it is always better to use Mutual Funds than to do-it-oneself.

There is no minimum age when one can start investing. The moment one starts earning and saving, one can start investing in Mutual Funds. In fact, even kids can open their investment accounts with Mutual Funds out of the money they receive once in a while in form of gifts during their birthdays or festivals. Similarly, there is no upper age for investing in Mutual Funds.

Mutual Funds have many different schemes suitable for different purposes. Some are suitable for growth over long periods, whereas some may be for those in need of safety with regular income, and some provide liquidity in the short term, too.

You see, whatever stage of life one is in, or whatever one’s requirements, Mutual Funds may have solutions for each one.

SIP=EMI ?

2017-10-03T03:17:00.003-07:00

We know best option to buy a house, Buy a two/four wheeler, Electronics goods or to repay our loan is EMI. Do You Know to create wealth you can use it known as SIP. view the video and know how could you get benefited.

How much you should save.

2017-09-21T11:56:00.002-07:00

At least 20% of your income should go towards savings. Meanwhile, another 50% (maximum) should go towards necessities, while 30% goes towards discretionary items. This is called the 50/30/20 rule of thumb, and it's popular quick-and-easy advice.

Warren Buffett Says...

"Someone's sitting in the shade today because someone planted a tree a long time ago"

The lesson here is to be a forward thinker when it comes to personal finance, whether you're talking about investing, saving, or spending. When you're deciding whether to put some more money aside for emergencies, think of a financial emergency actually happening and how much easier your life will be if you have enough money set aside.

Similarly, few people get rich quick by investing, and most people who try end up going broke. The most certain path to wealth (and the one Buffett took) is to build your portfolio one step at a time, and keep your focus on the long run.

1.52 crore SIP accounts do you have one

2017-09-10T09:21:00.002-07:00

The mutual funds have currently about 1.52 crore SIP accounts through which investors are regularly investing in every month in various mutual fund schemes.

Yes it is a investment methodology in which investor invest a fixed amount in regular interval of time as once in a month instead of investing a lump sum or at once. Minimum investment amount of 500 rupees.

As per AMFI about 8.23 Lacs SIP accounts are adding in each month on an average during FY 2017-2018 with an average SIP amount of rupees 3250.00 rupees.

Total collection of money through SIP accounts during April 17 To July 17 is 18544.00 crores
During FY 16-17 total amount of 43921 crore was collected through SIP.

All the above figure are showing how is it gaining the popularity in investing options available now days.

Have you started it - if not start today.

TOP 15 Mutual Fund Houses as per AAUM For the Quarter of April-June 2017

2017-09-04T02:46:00.000-07:00

Asset Under Management (AUM) refers to the total market value of investments managed by a Mutual fund Money management firm Porfolio Manager or other financial services company.

AUM generally changes according to the flow of money in to or out of a perticular fund or company. It also fluctuates based on changes in the value of a fund or company's underlying investment.

AAUM - Average Asset Under Management

Source:-

What is NAV and how is it calculated ?

2017-09-03T04:46:00.000-07:00

The Net Asset Value (NAV) of a mutual fund or an exchange-traded fund (ETF) on a specific date or time is the price at which units of mutual fund are bought or sold. It is the market value of the fund after deducting all liabilities, then divided by total no of units.

i. e. : NAV = (Total fund value – All Liabilities)/ Total no of units

In the context of mutual funds, NAV per share is computed once per day based on the closing market prices of the securities in the fund’s portfolio. All of the buy and sell orders for mutual funds are processed at the NAV of the trade date. However, investors must wait until the following day to get the trade price. Mutual funds pay out virtually all of their income and capital gains. As a result, changes in NAV are not the best gauge of mutual fund performance, which is best measured by annual total return.

As ETFs and closed-end funds trade like stocks, their shares trade at market value, which can be a dollar value above (trading at a premium) or below (trading at a discount) NAV. ETFs have their NAV calculated daily at the close of the market for reporting purposes, but they also calculate intra-day NAV multiple times per minute in real time.

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What is Mutual Fund ?

2017-09-03T04:45:00.000-07:00

A mutual fund is a pool of money collected from number of investors having a common investment objective is managed by a team or fund manager

The Money is used to invest in various shares in equity market as well as in Govt Bond, or money market instruments. The gain generated from the collective investment is distributed proportionately among the investor after deducting permissible expenses and levees by “calculating net asset value” or NAV.

Mutual fund is constituted as trust. Therefore they are governed by the Indian trust act 1882. This trust is created by one or more sponsors who are the main person behind this Mutual Fund business. Every trust has its beneficiaries and in mutual fund case the investors are the real beneficiary who invests in different schemes of mutual fund.

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What is NFO (New Fund Offer)

2017-09-03T04:43:00.000-07:00

A mutual fund NFO or New Fund Offer is when a new mutual fund is launched by a fund house and is offered to the public before it opens up to daily transactions. allowing the firm to raise capital for purchasing securities and investing the initial capital in different investment instrument as per the investment strategy of the fund mentioned in offer document.

Before purchasing the NFO its better to go through the offer document and understand the investment strategy of the new fund. Then it may be studied and compare to your Investment objectives. If it matches to your objective then can be purchased.

There are largely two types of mutual funds – actively managed funds, and passively managed funds, and in most cases any new fund that’s launched has a fund similar to it already available in the market.
In such a situation, it makes more sense to buy into a fund that’s already available, has assets under management, and some track record to go by.

Conclusion

As various funds are available in market from different AMCs may have comparably same investment strategy, So, you should buy a few mutual funds with limited overlap so that it really gives you the benefit of diversification. With that in mind, evaluate each NFO carefully to see whether it’s worthy of your portfolio or not.

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Different Types of Mutual Fund in India (Part-4)

2017-09-03T01:01:00.001-07:00

Some other types of funds or terms we usually used at the time of Investment are as follows.

1. Large Cap Funds

2. Mid Cap Funds

3. Small Cap Funds

Large Cap Funds

Large cap funds are a type of equity where funds are invested in a large portion with companies of large market capitalization. These are essentially large companies with large businesses and big teams. Large cap stocks are commonly referred as blue chip stocks. Large cap funds are considered to be safe, have good returns and are less volatile to the market fluctuations compared to other equity funds (mid and small cap funds).

Mid Cap Funds

Mid-cap funds invest in mid-sized companies. Stocks held in mid-cap funds are the companies that are still developing. These are mid-size corporates that lie between large and small cap stocks. When an investor invests in mid caps for a long term, they prefer those companies that they think will be tomorrow’s runway successes. Also, the more the investors in mid-cap stocks, the more it tends to grow in size. Since the price of large caps has increased, big investors like mutual funds and Foreign Institutional Investors (FIIS) are increasingly investing in mid-caps.

Small Cap Funds

Small cap funds take the exposure at the lowest end of the market capitalization. Small cap companies include the startups or firms that are in their early stage of development with small revenues. Many successful small cap firms have eventually grown into large cap companies. Since, small cap stocks give high growth potential, companies in their early stage of development, have great scope of higher developments.

Difference between Large, Mid and Small Cap Funds

Investments: Large cap invests in those companies that have the potential of showing year on year steady growth with high profits. Mid-cap funds invest in mid-sized companies. Investors who invest in mid-cap usually prefer those companies that are future’s runaway success. Whereas, small cap companies are generally younger companies or startups that have a lot of scopes to grow.

Market Capitalization: Large cap companies have a market capitalization of more than INR 1000 crore, while mid caps could be companies with a market cap of INR 500 Cr to INR 1000 Cr, and a market cap of the small cap could be less than INR 500 Cr.

Companies: Infosys, Unilever, Reliance Industries, Birla, etc., are a few well-known large cap companies in India. Some of the most emerging, i.e. mid-cap companies in India are Bata India Ltd, City Union Bank, PC Jeweller Ltd, etc. And some of the well-known small-cap companies in India are Indiabulls, Indian Overseas Bank, Just Dial, etc.

Risks: Mid cap and small cap funds are more volatile than large-cap funds. Large cap mutual funds tend to outperform both mid and small cap funds during the bull market.

Different Types of Mutual Fund in India (Part-3)

2017-09-01T08:16:00.004-07:00

Again Equity fund basically known as Stock fund can be categorized as discussed bellow.

1. Diversified Equity Fund

2. ELSS/Tax Savings Fund

3. Index Funds

4. Sectorial Funds

1. Diversified Equity Fund

Equity funds which are not specially Large cap or Small and Mid Cap oriented funds and will not include sector funds in other words it invests in companies regardless of size and sector. Its diversified the investment across the stock market in bid of maximize the return.

2. ELSS/Tax Saving Funds

As the name ELSS (Equity Linked Savings Scheme) or tax Saving Funds are basically facilitate the investor to get tax benefits on their investment. This is an equity diversified fund and investors enjoy both the benefits of capital appreciation, as well as tax benefits under section 80-C of income tax act.

This type of mutual fund have a lock in period of 3 Years from the date of investment. Investor can exit ELSS after selling it after 3 Years.

3. Index Funds

An Index fund is a type of mutual fund with having a portfolio to match or follow the component of a market Index. Index fund is a passive form of fund management that has been successful in outperforming most actively managed mutual funds. Basically it gives a return as nearer return of the tracked Index.

4. Sectorial Fund

Sector Fund is a stock mutual fund, Exchange-traded or closed-end fund that invests solely in businesses that operate in a particular industry or a sector of the economy. Because the holdings of this type of fund are in the sae industries, there is an inherent lack of diversification associated with these funds.

Previous Sections You can follow.

Different Types of Mutual Fund in India (Part-1)

Different Types of Mutual Fund in India (Part-2)

Continued.....

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Different Types of Mutual Fund in India (Part-2)

2017-08-30T22:22:00.000-07:00

In Previous section Different Types of Mutual Fund in India (Part-1) we know about the Open-Ended, Closed-Ended and Interval Funds.

By Investment Objective it can be classified as more four categories.

1. Equity Fund

An equity fund generally invests in equity market that means in stocks. The fund can be again managed actively known Active Fund or may be passive management in case of Passive Funds witch follows one of any equity market index is also known as Index fund. It invests at a minimum of 65% of fund value in equity market, it may be increase to 100%.

2. Debt Fund

Debt mutual fund generally invests in mix of debt or fixed income securities such as treasury bills Government Securities Corporate Bonds money market instruments and other Debt securities of different time horizons. Generally Debt securities have a fixed Maturity date & pay a fixed rate of interest. They are further classified on the basis of the maturity of the debt that they hold. Note that Debt is less volatile but also returns less. Equities are more volatile in the short term, but also return more over the long term.

3. Balanced or Hybrid Fund

Hybrid fund is a category of mutual fund whose portfolio is a mix of equity (Stocks) and Debt (Bonds). The proportionality of equity and debt may vary over time or remain fixed.

the volatility is low in compare to equity fund as a part of fund is invested in Debt category.

4. Money Market Fund.

Money Market fund is an Open-Ended Mutua Fund offers a potentialy rewarding parking facility for short-term Idea Cash. Its provides the flexibility of withdrawing cash as and when required, and proves to be an investment through its earnings, while it is parked in the fund. As this type of fund can be used as a bank S/B account which relatively gives a increased return.

Understand CIBIL (Credit Bureau)

2017-08-30T02:58:00.000-07:00

TransUnion CIBIL Limited is India’s first Credit Information Company, also commonly referred as a Credit Bureau. We collect and maintain records of individuals’ and non-individuals’ (commercial entities) payments pertaining to loans and credit cards. These records are submitted to us by banks and other lenders on a monthly basis; using this information a Credit Information Report (CIR) and Credit Score is developed, enabling lenders to evaluate and approve loan applications. A Credit Bureau is licensed by the RBI and governed by the Credit Information Companies (Regulation) Act of 2005.

Based on this credit history, a 'CreditScore' is generated. The CIBIL Score is a 3-digit number ranging from 300-900.The score is derived using the credit history found in the CIR (Credit Information Report). A CIR is an individual's credit payment history across loan types and credit institutions over a period of time.The closer your score is to 900, the stronger your credit profile. A CreditScore plays a critical role in the loan and credit card approval process

Why is it Important ?

The CIBIL Score plays a critical role in the loan application process. After an applicant fills out the application form and hands it over to the lender, the lender first checks the credit score and credit report of the applicant. If the credit score is low, the lender may not even consider the application further and reject it at that point. If the credit score is high, the lender will look into the application and consider other details to determine if the applicant is credit-worthy. The credit score works as a first impression for the lender, the higher the score, the better are your chances of the loan being reviewed and approved. The decision to lend is solely dependent on the lender and CIBIL does not in any manner decide if the loan/credit card should be sanctioned or not.

What major factors affect my credit score?

To Know more Click hear

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Different Types of Mutual Fund in India (Part-1)

2017-08-28T22:43:00.002-07:00

1. Open Ended Fund
In this type of fund the units are buy and sell in continuous basis. A investor could make a entry with his investment at any time or level and may exit too even if after the period of NFO (New Fund Offer). The units are bought and sold at the NAV (Net Asset Value) declared by the fund. The number of outstanding units goes up or down every time the fund house sells or repurchases the existing units. This is the reason that the unit capital of an open-ended mutual fund keeps varying.

2. Close Ended Fund

The unit capital of closed ended fund is fixed and they sell a specific number of units. like in open ended fund investors cannot buy the units of a closed ended fund after it's NFO period is over, this means that new investors can not enter nor can existing investors to exit the term of the scheme ends, however to provide a platform for investors to exit before the term the fund house list their closed ended schemes on a stock exchange.

3. Interval Funds

Its a partly open-ended and partly closed-ended fund. The units may be traded on the stock exchange or may be open for sale or redemption during pre-determined intervals at NAV-related prices. Fixed maturity plans, or, FMPs are examples of these types of schemes.

Continues........

Different Types of Mutual Fund in India (Part-2)

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Interest rates of different banks. As on 22/08/2017

2017-08-28T07:09:00.002-07:00

As on 22/08/2017

Interest rates of different banks in different slabs of time.

If we will calculate it with current inflection then we get nothing over the time period.Now is the solution to search for alternative option of investment which could beat inflection.

Why Mutual Fund ?

2017-08-28T07:04:00.002-07:00

Mutual funds generally buy and sell securities in large volumes which allow investors to benefit from lower trading costs. The smallest investor can get started on mutual funds because of the minimal investment requirements. You can invest with a minimum of Rs.500 in a Systematic Investment Plan on a regular basis.

Earning Spending and Saving is a financial cycle for every one on every month. Every one knows how significant the role of savings in our life cycle. for some of following future needs or you can say the future goals. every one to face in their life cycle for which every one saves his hard earned money in different instruments are available now days.

1. A Home 2. A vehicle 3. Marriage 4. Children’s Education etc…..

Without proper planning it couldn’t be possible to handle these things. Ultimately our aim is to save money and to get a handsome return within a stipulated time frame. We are having in hand many investment options available but we should select a option which will give us higher return by comparing the risk factor.

Mutual fund gives us a tremendous balance between return and risk as per investors profile or choice. Some of reasons to invest in Mutual Fund is as under.

1. Higher returns – As Full/Part of it is market linked.
2. Managed by professionals – A team of professionals are managed the fund
3. Disciplined investing – A small amount can be invested every month
4. High Liquidity – Money is ready when you need
5. The fund as your choice – You can chose as your investment Objectives
6. Diversification – Invested in Different sector or Different Instruments
7. Convenience – The whole process is offered online by industries

My Smart Investment "MUTUAL FUND"

Rupee Cost Averaging

Getting started on a rupee cost averaging strategy

Aadhaar linkage with bank accounts mandatory, - RBI

How Often To Review Your Mutual Fund

How many years need to get your money Double (RULE-72)

Happy Diwali

When should I start investing in Mutual Funds?

SIP=EMI ?

How much you should save.

Warren Buffett Says...

"Someone's sitting in the shade today because someone planted a tree a long time ago"

1.52 crore SIP accounts do you have one

Have you started it - if not start today.

TOP 15 Mutual Fund Houses as per AAUM For the Quarter of April-June 2017

What is NAV and how is it calculated ?

What is Mutual Fund ?

What is NFO (New Fund Offer)

Different Types of Mutual Fund in India (Part-4)

Different Types of Mutual Fund in India (Part-3)

1. Diversified Equity Fund

2. ELSS/Tax Saving Funds

3. Index Funds

4. Sectorial Fund

Different Types of Mutual Fund in India (Part-2)

1. Equity Fund

2. Debt Fund

3. Balanced or Hybrid Fund

4. Money Market Fund.

Understand CIBIL (Credit Bureau)

Different Types of Mutual Fund in India (Part-1)

​Interest rates of different banks. As on 22/08/2017

Why Mutual Fund ?

Interest rates of different banks. As on 22/08/2017