Suggest a topic

A lot of you reply to the daily emails with suggestions for posts, and I really appreciate that because it gives me post ideas, and I can write about stuff that is most relevant to you.

Normally, I take the gist of your suggestion; create a title of the post, and note it down on a virtual sticky note. But, the issue with this is that it is easy enough to miss an email, and sometimes the titles on the sticky notes don’t make any sense to me when I look at them later on.

So, I am creating a page here that is specifically for your suggestions for posts. You can leave a comment here suggesting an idea for a post, and if I know enough about the topic I will write about it.

That way we won’t lose track of anything you say, and if multiple people suggest the same topic for a post then I know that it should be written prior to moving on to other things.

Thanks for reading – and writing!

1,788 thoughts on “Suggest a topic

    1. Thanks for your suggestion. I’ll try and write something up on this topic in the coming week. This measure was introduced to reduce volatility especially in the face of a special event after the close of market hours the previous day. I think a good recent example would be the N. Korean strikes on S. Korea which happened after the market closed. I’m not sure if Korea follows this mechanism or not, but that’s one thing that can cause the market to open with a big gap, and this system would help reducing the volatility in those kind of events.

      That’s a good suggestion!

      1. Actually, I was interested in knowing —
        1. how Debt Funds compare with Bank FD’s,
        2. what are different types of Debt Funds and
        3. some good Debt Fund products available in the market.

        1. Okay, thanks for narrowing it down. Each point in your comment can be a post on its own, and I’ll write something on different types of debt funds next week.

          Thanks.

    1. Hi Radhika,

      I tried looking up this info some time ago, but really didn’t make very much headway into it. I’ll try looking it up again, but I think the best I’ll be able is to point out other websites that have done such comparisons, as last time I felt like I didn’t have much to add beyond what they had already written.

      It will take a bit of time though….maybe a couple of weeks.

  1. Hi Manshu
    Can you post something on Embedded value of a company, both through traditional and market consistent approach. I have seen these values being published by some rating agencies and also know that there are two approaches for calculation. I really would want to know how it is calculated and what is its significance in interpreting the fundamentals of a company.

    Thanks

    1. I thought that was only used to evaluate insurance companies but I’ve not read a lot about this, so I may be wrong. Where did you come across a report that mentioned this? I’d be curious to take a look so I know we are talking about the same thing.

  2. Hi Manshu,

    Could you please write about different online trading portals? Which is best in terms of service, tariff etc? Please include SBI in the list.

    1. Yes, let me try my hands on that. The issue is probably that there is no good way to assess the service as different people have different experiences, but I’ll see what I can do. I still owe you the credit card article, so this after that one.

  3. Hi Manshu,

    Could you please write about Income Tax calculations and where to invest for saving Income Tax. Is ELSS Funds are allowed for this year or what ? Please include some examples.

    Thanks
    khalid

    1. Sure Khalid, I think ELSS are allowed for this year, and will only be disallowed from next year onwards. I think I’ll be able to get to it sometime the week after next.

      Thanks!

  4. wanted to suggest-which are best dividend paying stocks in india & how are there growth prospects? whether to buy that stocks for long term or not?

    1. Thanks for your suggestion Vasim. I’ve seen a good post on this topic on the Tip Blog, and you can check it out here on this link:

      http://www.tipblog.in/stock-chat/dividend-paying-companies-india/

      As for recommendations on whether or not you should buy a particular stock – I don’t get into that at all because I don’t have the bandwidth or the competence to evaluate all these companies and see which one stands out amongst them.

      You can check out the post, and that should help you make an informed decision.

  5. I want to understand how banks fix their lending rate of interests for various loans such as home loan, car loan, personal loan, etc. I sometimes here news about RBI fixing on lending rate of interests. In that case, how come it is different among banks? What is BPLR? and how does it relate to the banks lending rate? Please explain or provide some pointers to understand this.

    1. It’s a great topic Chirag, but I’m not knowledgeable enough about it to write something that will add to anything already available online. Sorry.

  6. Manshu Sir
    You are doing a great job! I am a new reader of your blog and I just love it! Very simple language, almost all financial areas covered, personalised attention to every reader, simple web layout and above all….. YOUR HONESTY!
    Great going sir!
    It would be great if you can provide some info about PAYPAL VERIFICATION in india.
    Thanks for maintaining a superb blog!
    Regards
    Shreyansh Jain

    1. Shreyansh – Thank you so much for your kind words, and a very happy new year to you!

      I did the verification a number of years ago, and have been a little out of touch, what with all the changes RBI has mandated, so I’m unable to write about this topic, sorry.

      I did find this article that looks good, so I hope this is a good start for you.
      http://indiapoint.net/ca/2010/04/23/using-paypal-in-india-and-verification-process/
      Once again, thanks for all your lovely words.

  7. Kindy write a articel on the difference between IRR, Rate of interest and Effective Rate of Interest. If you apply for a loan in a bank ( particularly private sector banks ), they say interest rate in the name of IRR. But as far as I know, IRR is the rate of interest where your discounted cash inflows matches with cash outflows . If private sector banks say IRR, does it mean that they are selling without profit ?
    Please clarify

  8. Hi

    Kindly let me know the important websites and blogsites addresses, who give information and articles about finance, tax, economy etc , without any motive behind it like what you are doing right now ,so that readers like me who want to learn finance through simple topics would be benefited.

    Thanks in advance.

    1. I like to read Hindu Business Line, Business Standard for my news, and Business India is a very good magazine. Then there are a whole host of blogs that I read, but what I normally see is that when I do my weekly links post, there aren’t too many outgoing links from them, so I get the feeling that perhaps what I read myself is not so interesting to people who read this blog.

  9. i want to know about the indian government policies about the unemployment. what are they doing about it and how much they have done.

    1. Milind – I don’t think I’ll be able to write on government policies on unemployment, and how effective they are because I’m not familiar enough with the topic. Sorry.

  10. Hi Manshu

    I like your articles and feel they are very informative.
    Can you inform us on the following articles also:
    1. Best Indian Home loans rates -& impact on Income Tax
    2.Section 80DD -treatment expenses for family member for tax deductions
    3. Impact of Foreclosure of loans (any types) on loanee.
    4. How to file income tax online.

    regards

    Varsha

    1. Thank you Varsha – a lot of suggestions in here, and I will try to cover as many as I can in the coming days. I think 1 will be a little difficult though because I’ve tried doing that once, and found that the data is not easily available.

  11. I hear that investing in silver is a great idea for 2011. From what i understand, MMTC is the cheapest seller of silver. But their selling price is 54000 per kg Vs 45000 which is the trading value of silver. Now if i buy it at 54000 then i am not going to make any money till the market value crosses 54000. I was told by MMTC that the 9 grand premium has to be paid as MMTC cost/mark-up etc. I can someone tell me if there is a cheaper way to buy silver? Also if i buy silver online what are the capital gains implication when i sell it? thanks.

    1. Mukund – Here is a post I did on silver ETF alternatives that has already discussed options that you’re looking for.

      http://www.onemint.com/2010/11/16/silver-etf-alternatives-in-india/

      And here is a more detailed post about NSEL. I can’t really give you a one word answer saying a or b is best because everything has its pros and cons, so you’ll have to read these options and evaluate them based on your needs.

      http://www.onemint.com/2011/01/13/e-gold-and-e-silver-from-nsel/

  12. Hi Manshu,
    Thanks a lot for your excellent articles.Can you please write an article about how economy works.What decides/limits about the amount of currency a country can print.why not a country become rich by simply printing money?.Also can you please suggest articles/books to understand how economy works.

    1. Thanks Shankar. I can’t think of any books or articles on the top of my head, but I will try to hunt some for you, and write a post on this topic as well.

    1. I’m yet to come across something that convinces of the utility of ULIPs, and makes me look at them. Until that time I think my time is better utilized looking at other topics. Thanks for your suggestion, and you’ve written a good post yourself.

      Only observation I have is that often it’s handy to take a product within a category – analyze it in detail – and then use that knowledge as examples to make your point.

  13. Hi Manshu,
    I was looking for some good term insurance and couldn’t locate it here, would it be good if you can give some valuable inputs on it?.

    Thanks.

  14. Hello, I have been reading in a lot of places regarding to keep the Auto Loan as less as possible. However, i do not understand the math behind it. Have a look at the below thought and let me know.

    2 months back I bought a car worth 5.5 lacs. Luckily i had all the money in the bank and could afford to buy it outright. However, I went ahead and got a loan of 2.75 lacs and paid the rest from my pocket. Here is the logic

    Loan Details:
    Loan Amount: 2.75 lacs
    Interest rate: 9.25%
    Loan Tenure: 3 years
    EMI: 8800
    Total Interest paid: 40,970

    If I put the same amount of money in a standard fixed deposit recurring for 3 years at 8.5% per year, here is what I get
    FD Amount: 2.75 lacs
    Interest Rate: 8.5%
    Tenure: 3 years
    Interest Received: 76,254
    Amount on Maturity: 351,000

    So in effect by taking the loan I have saved myself 36,000. Even if you take it post tax you are in profit. In other words, the higher the loan amount or longer the tenure you would be in more profit. I wonder what am I missing ??

    1. Hi Swanand,

      Interesting question, so is it normal for people to get car loans at 9.25% these days, or did you get a deal because of your employer or something?

      A 1 year fixed deposit with Indus Ind fetches you an interest of 9.5% these days, and you got a car loan for less than that, which is the reason I ask the question.

      Anyway – if I were in this position I’d look at it the following way.

      Case A – Put the money in a FD, and take a loan. In this case you get interest Rs. 76,254 and pay interest Rs. 40,970, so the net interest you gain is Rs. 35,284.
      Now, I have a liability to pay Rs. 8,800 for the next 36 months.

      Case B – Pay off the car payment with my money right now, and free up Rs. 8,800 for the next 36 months. Create a recurring deposit with it at say 8.5% which is the FD you took.
      The calculator here shows me that this will come to Rs. 361,117 at the end of 36 months.

      8800 x 36 = 316,800 is my own money out of this, so the interest I get from here is Rs. 44,317.

      So, in this case since there is no interest outflow I gained Rs. 44,317.

      This is one angle of looking at it. Of course, what I do depends a lot on factors beyond math like I shun personally shun debt as much as possible, and others might not mind it so much, but this is one way to think about it.

  15. Hello Manshu,

    Thanks a lot for your reply. Well the 9.25% was not too much of a fight, I got that rate as against a rack rate of 9.5% as I am a preferred customer from the bank I took it from.

    Basically I wrote to you to understand, why I couldnt find an analysis like the one I did on any of the Personal Finance sites. So for all this while i was wondering if I am missing something.

    Well I guess there isnt much to choose between case A and case B, because even in Case A, FD was just an example. I can very well earn upwards of 10% over 3 years from various instruments eventhough my outglow is fixed at 9.25%. In that case the difference in interests will be much more than even 50K over a 3 year period time frame.

    Anyways, thanks for your analysis. I guess someone out there needs to put up some material of looking at a similar situation in the context of Case A.

  16. Hi Manshu,
    I following your blogs for quite some time and you are doing an excellent job…
    I am from IT BFS sector. Do you suggest any good certification programs like CFA, FRM 🙂
    Thanks.
    Anand

    1. Thanks Anand. I don’t know much about certifications for someone from IT BFS. CFA is a really involved program and be sure to go through all the details before enrolling in it because it’s designed towards finance professionals and takes a lot of time and resources.

      The industry does seem to be moving towards Agile so you could look at some Scrum certifications as well.

  17. I recently got an email about no penalty Fixed Deposit. I don’t remember if I got that email from Axis bank or from one mint but most likely it was from Axis bank. Unfortunately I deleted that email and now I am in need to open FD with no penalty feature. I cannot find details on their website. Do you know FD scheme of such nature from Axis.

  18. Not really a topic but a question. Does return show on MF sites (such as Value Research) already include fund’s expense ratio or that has to be factored separately? Is annual expense of AUM is only expense investor bears or is there anything else that’s not mentioned (corrollary: are brokerage commissions, fund manager’s fee, marketing/operating expenses, trailing commissions all accounted for in expense ratio?)

    1. Yes that has the fund’s expenses factored in. The NAV is the value at which you should be able to buy or sell a fund.

      NAVs are calculated after expenses have been taken into account, and the expense ratio takes care of all the expenses that the fund charges you.

      1. Thanks, but if NAV and return already includes fund’ expense ration, why should expense ratio be part of decision making process at all? Even then, many websites recommend that, every thing else being equal, one should go for fund with lower expense ratio. This is often big part of advise on Gold ETFs or Index funds.

        For example, suppose I get 15% return on two funds A & B with expense ratio of 1% and 2%. Then actually, fund A got 16% return before expense and fund B got 17%. Is this understanding right?

        1. Because expenses eat into returns, so if you have two gold ETFs that are only going to hold physical gold, and one has an expense of 2% whereas the other has expenses of 1% the 1% one will perform better. There could be discrepancy in this in the short run since the ETFs invest some part in money market funds etc. but over the longer run you will find this to be true.

          Just looking at NAV doesn’t do much for making a decision on which mutual fund to buy.

  19. Online Insurance premium comparison chart for term plans.

    I think this would be really helpful and cost effective for people who are looking for insurance.

    1. Insurance is not my strong point so I avoid writing about it, but a lot of comments have come about insurance so I plan to at least begin covering this in a little more detail. I’ll try my hands on this post though I am not sure if I’ll actually be able to write it.

  20. 1) What is the difference between equity and debts products? Please explain with examples? Are PPF, FD debt products?

    2) Which kind of mutual funds are better? Growth or Dividend?

    1. Thanks for the suggestion Shipa, and I’ll write a post on this. Also, thank you for following up on my email and leaving a comment here. Too often, people email me and when I request them to post a suggestion here, they don’t do anything. Makes me wonder if my time is less valuable than others.

  21. Hi,

    Can we get some more details on NPS (New Pension System)?

    Is it worth to invest in it for private company employees?

    Thanks
    Nimeesh

    1. There is one post on that topic already, and let me update that with some new details that have come up. Will take a little time though, as everything that I does unfortunately 🙂

  22. Information on Indians investing outside India: ways to do so, markets that can be invested in, instruments, special documents/permission required. Specifically, on trading in foreign index funds – Russia, China, etc. I am aware that there are F&O instruments but I am not aware if there is any ETF, index fund or mututal fund.

  23. How can retail investor invest in commodities (other than Gold)? Are there funds which cater to investment in, say, silver, copper, oil, cotton, etc.? Commodity Exchnges provide only F&O instruments which are for short-term basis only. Is there a way to invest for long term?

  24. Hi,

    India is now the second fastest growing economy in the world,most news papers mention this often.Could you write as to what actually is contributing to our economy? is it I.T, agriculture?What actually is accelerating our growth?
    Regards,
    G

  25. Manshu,
    Did the ONGC Stock split take place this month?
    Can you update a bit on this process of stock split and bonus and how and when does it reflect in the demat account.

  26. Dear Manshu,
    You have explained the difference in the values of Gold ETFs in simple terms. Thanks! I used to always wonder about this.

    Similarly can you please explain why e-gold is more expensive than ETF and spot gold prices?

    1. That’s done – please respond to let me know if you have seen it or not, and if it answers your question. I haven’t seen a comment from you on the original post.

  27. Sir,
    Could you please inform which is the best health insurance policy(in respect of Hospital admitting/major surgical benefit etc) for an adult of 37 years and having two dependents (wife and child of three years).

  28. kerala transport development finance corporation gives a good rate on FD’s please find the link;

    < --link deleted as it opened a phishing warning on browser-->

    does it make sense to invest in something like this?

    1. Corporation Bank is giving out 9.25% for less than 5 years, so I’d much rather go for that as this is giving the same interest rate, and is more secure being a bank deposit.
      Also, can you please post further questions on the Forum as other people are also following that and you’re likely to get responses from more folks there.

          1. I’m also thinking of investing in Karur Vaisya Bank and would like to know if its safe for large FD ? What’s the reason they offer higher interest rate on FD as compared to others ?

            1. Can you post a link to the high FD rate they’re offering preferably in the forum; I’m unable to find it. Also, FDs up to 1L are insured, so you could potentially split the FD between family members and be protected.

                1. Thanks Vikas – so I see that this is really matching the interest rate but not the tenure, which goes back to what I mentioned earlier, that no one is letting you lock on to these rates for 5 years like SBI. Of course, it’s another topic by itself whether locking on to these rates is a good thing or not.

  29. I will appreciate if you can write a detailed analysis of Government revenue & expenses for the current year so all readers can see inefficiency of the govt. People are just concerned about the direct tax part of the budget. however we should also protest if govt is misusing our money.

  30. Hi,

    Your analysis of revenue/expense at the central level is very informative. Would be great if you can write on for the states also.

    1. I haven’t seen that data anywhere, so I’m guessing that they either don’t break it into that level of detail, or that I need to look more.

      I will see if the info is out there somewhere, and if I find something I’ll create a post out of it. Thanks!

  31. Hi Manshu,

    I really like your website. I am sure many readers can second my thoughts. I want to create my own website too. If possible, can you write a post on various steps, or links, how to buy domain, register your website, what tools do you use to make the website, post the content, organize it. Do we need to know html coding for it?This post is not related to finance, but i am sure can benefits other readers. Thanks. ~Shilpa.

    1. Thank you for your kinds words Shilpa – I’m delighted to read such a compliment. I have actually never given much thought to this topic, but it will make for a refreshing change of topics. I’ll try and write about it next week since I need a little time to think about this.

  32. Dear Manshu

    I appreciate the blog you have started , and to be frank one of your blog on saving capital gains tax through 54ec was very informative and something new to me. I would look forward for such interesting topics and concurrently accurate information with the particular industry experts, also I would suggest you can start a topic on “How to buy gold jewellery in India “

    1. I have absolutely no idea on what one must do with gold jewelery, but I was quite impressed with your comment today, and I think I might push that to a full post with due credit to you of course. What do you say? You’d like to add something to that?

  33. Dear Manshu, thanks , It would be my pleasure to share my expertise and knowledge with people on jewellery buying and also on gold bullion. There are still many more complex issues on gold jewellery and bullion sale / resale which I would add onto your blog..

    1. Thanks Niraj – I’ll publish your comment as a post next week as I have some ideas for posts already in mind. I’ll send you an email when it is published. Much Appreciated.

  34. kindly start a discussion on MOTILALOSWAL NASDAQ 100 ETF
    we can diversify from india this is good considering a SUDDEN FALL as recent experience shows will protect downfall and also once US economy improves we can gain

    < --deleted the Eco Times article content-->

  35. Hi,
    Like the way you write.. Congratulations on the good job.
    A thought popped in my mind to know where the insurance companies invest the money and how they manage to be profitable despite people continuing to live longer(?!, hopefully). How are their investments impacting lifestyles of people and economics in general!
    Would be very nice to see your analysis on all the points around this with “as usual” superb discussion from all the readers. I like the comments they give too… its amazing that you attract knowledged readers.

    1. Thank you Seshu – Even I’m glad that the sites attracts very intelligent discussions, and I just saw some discussion around bond yields which I think is a fairly complex subject, and amazing to see people discuss that regularly on OneMint.

      I’ll try to see if I can write something about this or not, but this will be on a slightly lower priority as you see there are a few other topics before this that are of interest to a larger group of people. I hope you understand.

  36. How about a topic on real calculation of capital gains tax on shares and mutual funds and how it can be used in filing tax returns?

    not sure if this has already been discussed.

    1. Hmmm – tax – i try to avoid tax because I’m not intricately familiar with it. I’ll see if I can write something but it’s not likely to be very detailed.

      1. Thanks Manshu!! Calculation of capital gains tax is always a pain for many people esp when you have many transactions for the financial year including debt mutual funds and capital losses on shares and equity mutual funds etc.

        1. Yeah, I know what you mean – I really don’t think or at least I haven’t come across a method to simplify this chore. One does need to go through all transactions and that’s a pretty meticulous task.

  37. Can you please do a post on the advantages of opening an account in the NPS Lite Scheme (Central Government of India’s Pension scheme open to all citizens)

  38. Hi Manshu,

    Please compare and write reviews of all trading platforms available in india. Which is better etc… ( eg, IndiaBulls, Reliance Money, ICICI Direct, Religare, SBI CAPSEC etc ). Try to bench mark the facilities given by them. Also let us know is there any platform to buy all investment/financial products under one roof. ( Including derivatives, MFs, e Metels, Bank and Company FDs ). If not all, Atleast let us know which covers most and best… Also analysis the Customer care,

    Thanks and Regards
    Vijay Athreyan R

    1. Sorry Vijay – I have tried to write about this in the past but didn’t find adequate info or means to compare one with the other, so I won’t be writing about this topic. Sorry.

  39. Hi again, Do you want to write something on forex trading? the to knows and what to expect? I havent found much in your website and thought i could request for this.

    Have a nice time!

    Bye
    Seshu

    1. Thanks for your suggestion Seshu – but I’m sorry I’ll have to disappoint you because I have never done any forex trading and I don’t know anything about that at all.

    1. I don’t know anything about ING ADAPT (heard the name first time today) so I won’t be writing about it. I will write about a general post on FMP in the future.

  40. I would like to suggest you to write on the service charges levied by Banks and other institutions & whether there is any authority to check on the modalities as to how various charges are priced eg DD charges, DD cancellation charges, Folio charges; Statement of Account charges, Cheque leaf charges etc. Is there any cartelisation? Pls check.

  41. Manshu,
    I’ve been trying to find out mutual funds and other financial options for a gift to my nephews. We have a Childrens’ Gift Fund, but apparently that doesn’t let anyone other than a parent invest in it.
    Could you please help and suggest some options?
    Thanks.

    Sohini

    1. I have never looked into this Sohini, but let me try to see if I can find some info on this. But at the top of my head, I’m not sure how one goes about gifting MFs.

  42. I request you to write a topic about understanding of tax calculations. I am sure you have given lot of information about this in various posts. Still, if you can bring altogether
    and put that information in one post, it will be very helpful/useful for the fresh earners. What do you say?

    Thanks for all the useful information posted in this blog. All the best!!!

  43. While this might a bit offtrack from your blog’s main theme, I must confess that I find your charts, tabulations and other information visualization very interesting. Towards this, can you discuss which tools you use and a bit about the data gathering and preparation process?

    1. There’s no real process or any special tools that I use. I use Keynote on Mac and GIMP which is an open source tool. Apart from this – there isn’t anything special and I’m certainly not as good with design as a lot of others are so I’m not sure what I will write on it. I guess I could write a bit on how to make the most use of your limited skills (which in my case are very limited) but I don’t know if that will be beneficial to anyone. Hmmm – let me think and see if I can write something meaningful on this.

  44. Dear Manshu,
    Can you write on ‘How to start trading in stock market ?’ with some general tips, dos and don’ts for someone who is a novice? I know that it is wholly unpredictable but are there some broad principles? some method in the madness???

    1. Dear Vijay,

      I don’t have any knowledge on trading. I’m strictly a long term investor (I do dabble in options from time to time) and recommend it to others as well. I don’t know of any successful traders to be able to write anything on this subject. Sorry.

  45. Dear Manshu,
    I feel that onemint is doing a good job in creating a platform where threads on finance and investment are actively discussed, debated and contributed to by other netizens. I feel that all citizens / netizens should have good knowledge of finance, medicine and law especially. This is because, we are not taught about them formally but i find that every adult should have basic knowledge about them. As a doctor, i find that many of my patients come to me armed with a lot of information about their disease as most of it is available on the web! As far as finance is concerned, many sites incl. onemint are doing a good job. Do you know of any website which offers good knowledge on legal issues?

    1. Dear Vijay – thank you very much for your kind words. You’ve contributed to the site through your comments and I really appreciate that as well.

      I’ve actually not seen any good resource on law. Usually, I try to read the act itself and see if I can make sense out of it. Go for the source was the mantra of my Law professor.

      You can try and see if that works for you. When you read about something in the news you can Google up the relevant act and read it.

      Specifically for Income Tax – you will find it here:

      http://www.incometaxindia.gov.in/

      Thanks once again for your kind comment.

  46. Dear sir,
    First of all i must congratulate you for the kind of information you have put up and clearing the queries of naives like me. Now my query is, Is e-Gold is safe to Invest in? which is one is better among e-Gold and Gold ETF to Invest? Is true that e-Gold can be converted to Jewlery? Please help me in clearing my query.

    1. Thank you for your kind words. I have a post on NSEL that ends with my concerns about the product. There are other people who have posted their clarifications so you may go through them as well.

      http://www.onemint.com/2011/01/13/e-gold-and-e-silver-from-nsel/

      As for converting to physical gold – yes they do have a process where you can pay the additional VAT and get the thing converted to gold, however, this is no different from cashing in your gold ETF and buying gold bars from a jeweler.

      I won’t be able to recommend anything specific to you, but you can go through the posts and make a decision yourself.

  47. Hi!!

    My query is related to savings account interest rate. In last year’s (FY 2010-11) budget, it was mentioned that banks have to calculate the same on a daily basis (Closing Balance for that day). But, I have clarified with my bank (HDFC) that they still calculate it on the minimum balance between 10 to last date of every month. With RBI increasing the rate from 3.5% to 4% for savings account, it would definitely matter to retail customers.

    Can you please clarify why is the daily basis method of calculation not followed?

  48. Please arrange to provide some article on Superannuation scheme. What will be the impact of superannuation investment in DTC system

    1. Thanks for the suggestion – PFC is too late now, but will look at other IPOs – esp. disinvestment candidates for sure. I used to write about those but the performance of most IPOs has been so bad that I’ve not given them much attention lately.

  49. Manshu
    can you write a post about how can one claim Dividend Yields for the stocks they hold and which are the stocks in the NSE with the highest divident yields….

    regards
    Sorabh

  50. Hi Manshu,
    Thanks for your website. It is indeed a great effort on your part to share your financial knowledge with all. Too few do that.
    I would like to know about the concept of special days FDs floated by banks (e.g. 555 days, 999 days etc). What is so special about these days? Why not a FD of 554 or 556 would give same interest?
    Do write about this at your convinience and thanks once again.

    1. Hi Vinayak,

      Thank you for your comments – I’m afraid I’m not aware of why this happens. I’ve sent out a note to someone who I think may know about it and I will post a response here if I find out.

  51. Hi,

    As a normal investor who primarily wants to invest in Mutual Funds, we dont have any proper data which can give comparitive analysis of say Top Funds from each Major Fun House like HDFC, ICICI, Reliance, IDFC, Birla, Sundaram, Tata, DSP …..

    Instead of diverisfying within a fund house, we can target for top 1 or 2 funds from all major fund house, that will provide good safety and good growth in long term considering dynamic market and even movements of top fund managers across companies.

    If we get details to levels like this for Small-Mid cap which fund is good, for large which one and so on…

    SIP based on this one whihc covers all category stocks with top funds from different fund house.

    Can we gather this data with your expert comments?

    Thanks
    Nimeesh

    1. What I would do is look for some good funds in a few categories like small cap, large cap, balanced, debt etc. and then mix them up so that they are from different sponsors.

      I already have a list for best ELSS, gold, balanced, and I think large cap funds as well – you may check them out.

  52. Hi, i really liked your blog and i feel u really know your game. For long i have been looking at Technical analysis but never followed it. Can you write an article about it and tell us whether has someone actually made money from it?

    1. Hi Sumit – I think this topic came up for suggestions earlier as well, but I have absolutely no knowledge of trading so I won’t be able to write on that topic.

  53. ETF Options are widely traded in US markets. Would like to know ur take on their introduction in Indian markets? which etfs should they b introduced on?? Thanx..

  54. Hi Manshu, I had a question about real estate. Did not see a particular section to post it in so asking here. Recently, read that as interest rates keep going up, it will have a dampening effect on real estate sector, leading to a decrease in prices; would take 6 months or more to play out. Is this always the case cyclically, or historically? Also, because the RBI has hinted at a further point increase in the interest rates, there are outstanding builder loans too. Thanks!

    1. Hi Sudha,

      No it’s not cyclical, meaning real estate prices don’t drop every time there is a hike. People are probably saying this now because as interest rates go up the ability of households to take loans diminish (EMIs increase), and a lot of real estate developers are quite leveraged as well. These are opinions, and may or may not come true. Property prices have heated up quite a bit in India, so I won’t be surprised if this does turn out to be true, but I wouldn’t say this is generally true.

      I hope I understood your question correctly, and answered it accordingly?

        1. It appears quite similar to the US experience where property prices just kept going one way until it stopped and everything collapsed. I don’t know if we will have such a collapse in India or not, but I think a lot of people who think property prices can never fall are in for a rude shock.

  55. With your latest topic on fixed deposit, i think you could follow it up with giving a nice introduction on corporate fixed deposits. I always thought of invested in the ones with rates as high as 12-13% but was not sure how it compares to bank fixed deposit.

  56. Hi Manshu,
    I was wondering when would it be a case where opting for Home loan instead of upfront payment( providied you have the cash) be beneficial. I came across a decent post here http://www.jagoinvestor.com/forum/home-loan-beneficial-than-making-payment-upfront/1435/
    But all sorts of comments broke in factoring various angles. i am not sure if you have done a post before on this but thought it would be great to have your perspective on it.
    Thanks,
    Jinu

    1. Hi Jinu,

      I feel uncomfortable on commenting on something written on that post, and that is best left to Manish. I have never given thought to this subject so I’m unable to say anything right now. I’ll try to write a post on this but it might take a long time.

  57. First of all, let me tell you – You are doing an excellent job. Your blogs are really useful and have interesting material.

    I know you wrote about SBI Bonds few months back, now we have IFCI bonds. How about an article on IFCI bonds?

    Thanks,
    Parva Thakkar

  58. Hi Manshu,

    I just read something about IFCI bonds which are currently open . I have never invested in bonds before . would it not be wise to give a small review on these bonds and how they fare compared to the traditional fixed deposits?

  59. Please arrange to provide a write on recently launched “Jivan Arogya” policy by LIC Of India.How it is different from mediclaim poilcy provided by other GIC.

  60. Manshu, not sure if this topic has been discussed before on your boards or elsewhere, but I am curious to know if there is an “online” way to buy fixed deposits offered by corporate entities like Mahindra, Bharti, Sundaram, et al. This could be either via my bank’s website or my investment/trading portal.

    Regards,
    Swaroop

  61. Hi Manshu,
    Not sure if you have covered the topic of Top-Up medical insurance policies. If not can you write a topic on that? Insurance companies which I know of which offer these plans are Bajaj Allianz (Extra Care), United India (Top & Super Top-up) & Star Health (Super Surplus).

    1. Hi Monty,

      I don’t know a lot about insurance so I don’t know if I’ll be able to cover this in depth or not, but I’ll surely try to write an article that touches on the basic aspects, and will try to find links of articles that others may have written.

  62. I have got myKYC verified from CDSL ventures for Mutual funds transactions. Corporation Bank(where my account is ) is now asking me to apply for KYC. Is it not enough that I have already my KYC verified like I said above,Can I submit a copy of the same to the Bank?

  63. Can you please write about (1)wealth tax? Current cap & changes proposed in DTC, etc.
    Who needs to pay and on what?

    I had also asked about (2) investing in Forex, can Indians buy & hold foreign currency?

    More suggestions will follow…

    Thanx for all the good articles!!

    1. Thanks for the suggestions – there are just too many things lined up to do, and that’s the only reason I’ve not been able to get to your earlier suggestion. Unfortunately, it does take me a long time to get to suggestions!

      1. I understand that availability of time can always be a constraint.
        Thanks for the article on Wealth Tax.

        I did some research on holding/investing in foreign currency. Reasonably ok info is available on RBI website.

        1. Thanks for your understanding, and I’m glad you found some info on the RBI site. They have some excellent reports there as well if you’re ever interested in that kind of thing.

  64. Dear Onemint,

    You guys are really doing well and passing lot of knowledge through this platform. It is seriously useful for individuals and students.

    Query:
    I am a salaried employee earn approx INR4.2 Lakhs pa and some 1 Lakhs as bonus. I want to structure my salary so that I pay minimum taxes. I know some basic things like HRA, Travelling and Medical Allowance

    Please help me

    1. Dear Akhil,

      Thanks for your kind words – I have written a post about Introduction to Income Tax a few months ago. That should get you started and there are links to other articles in that post that explains on the specific parts I touch upon.

      I think that should be a good place for you to start and if you have more questions then please leave a comment and I’ll try to answer it to the best of my ability.

      Here is the link:
      http://www.onemint.com/2011/05/03/introduction-to-income-tax/

  65. I am facing lot of problem to manage my saving and investments.

    I have FD in various banks, Bonds of various company, NSC, PPF, Company’s Provident Fund where I am working,investments in stocks, NCD,etc…etc…..

    Immovable property like flat(apartment), house at village etc…etc…..

    Movable property like Car, TV, Fridge, Gold, Diamond, Gold ornaments, Diamond ornaments, Precious stones, Silver, Sliver utensils, silver ornaments, Two wheeler, computer, laptop, air conditioner, etc…….etc…..

    I am facing too much difficulties to manage all these thing.

    Many software i tried on net but they are of no use……and proved hopeless junk.

    I need a software which track all my investments and it’s maturity dates and it’s reminders.
    It should calculate the interest for the financial year of any given FD so that i came to know that the interest on this FD is more then 10,000/- so tax will be deducted and if applicable i will fill up form 15G / 15H as applicable.

    Say for an e.g. I have (Say A) FD in SBI 20,000/-, in BOB 10,000/-, in HDFC 15,000/-….etc
    and say my wife (Say B) have FD in HDFC 10,000/-, in IDBI 5,000/-, in ICICI 20,000/-……etc

    Like that for all my family members including my mother.

    Now if i have to see how much investment of our family in HDFC so the software must show
    A has 15,000/- (as above data)
    B has 10,000/- (as above data)
    C has Nil
    D has Nil

    Like that……………..

    Now if i ask …..How much investment A has
    so it should show as below from above data
    A has
    20,000/- in SBI
    10,000/- in BOB
    15,000/- in HDFC
    Nil in ICICI
    Nil in IDBI…………………………like that

    If i ask for B it will show like above for B ……

    If i ask for all then it should show for all like above for A, B, C, D, …….etc

    It should generate report and It should be in printable format ( All the time i am facing problem to print excel sheet as it is too long)

    It should calculate interest from date of deposit to end of the financial year and then for next financial year it should take previous year’s (principal + interest) as a principal amount.

    All should be store at my machine and not on the web as so many site provide such type of the services.

    This software should contains all the important details of driving licence number, passport No.,…..ration card no…….ect…..

    It should contain scan copy of all the educational mark sheets of all the family member……..

    It should calculate so many things for stocks like date of purchase, sell gain, loss, capital gain tax,…..etc

    Something like these i need…..

    will you help

    1. Thank you for laying out your needs in such detail, but I’m afraid this is way beyond what I do here, and there’s nothing I can do to help you in this.

      All the best with your search though!

  66. how about a article on worst performing mutual funds specially equity diversified,
    comparison can done based on peer funds who have performed well
    also the fund houses who have maximum number of fund with bad returns as compared to peers in the respective category
    it will help in rating fund houses and finding the worst fund managers 🙂

  67. Hello Manshu !
    Since few days I am following your expert comments. Let me know the impact of Direct Taxes Bill on the PF savings of Public Sector Employees. And also let me know the impact of the bill on the House Building Loans (Principal and Interest)

    1. Thanks Phani – these are great suggestions, and I’ll try and write about them. There are a few topics that I should cover before getting to this one, so it may take some time.

      That shouldn’t be a problem though because DTC is still some time away 🙂

  68. Hi Manshu,

    Do you have an opinion on the take over Benchmark Asset Management Company by Goldman Sachs? I am specially interested in their changes made in the attributes of the Liquid BeES. The circular refers to changes in the Investment Objectives, Instruments, Risk Factors and Risk Controls among others.

    The one change I was curious about was in the Instruments which adds `Collateralised Lending and Borrowing Obligation (CBLO)/ similar intruments`. Why the ambiguous term “similar instruments”? Another change is in the Risk Controls. What do you think would these changes affect in terms of the scheme?

    Look forward to knowledgeable comments on these changes?

  69. Hi Manshu,

    Would be interested to see some light thrown on recurring deposits of banks. Especially the way tax is calculated on the returns – for example, if 5k is invested for a period of 10 years (6 lakhs) and at 9.25% interest rate, the amount becomes around 9.8Lacs, should we have to pay interest on 3.8 Lacs or does the calculation differ in anyway?

    Thanks,
    -Mike

    1. Hi Mike,

      I don’t know the answer to that on the top of my head. Let me research this a little, and if I find something I will write a post. I will leave another comment here in either case.

  70. Dear Manshu,

    This is to bring to your notice about Perfios.com, an online personal finance finance management solution from India. it currently serves 140000 registered users and has features like auto-update, 360 degree view for one’s portfolio and tax e-filing to name the few.
    This is to request you to review Perfios offerings.
    Please let me know how we can take this forward.
    Look forward to to here from you.

    Regards,
    Nehal Pandya
    8971220587
    nehal@aimhighindia.com

  71. Hi,

    Could anyone please publish the best Policy along with offering company that is highly benefitable under SECTION 80 D.

    please describe and do the needful

    thanks in advance

  72. Manshu, is it possible for you to talk about 2 most growing banks Yes and IndusInd Bank today. How do you find these and their business model?

    1. I’ll try to write about that Anoop, though there are several posts suggested here that I have to get to first, so this may take quite long.

  73. Hi Manshu, firstly I would like to sincearly thank you for enlightening us with so much of information which otherwise is not available so easily.

    It would be great if you could get us some information on the new IT return process in which we do not have to file a tax return if salary is below 5lakhs. There are lot of grey areas which people do not now yet.

    Regards,
    Jaimin.

  74. Hi,
    Can you do a post on Indiainfoline NCDs to be launched this week, probably on 4th Aug.
    You could also touch up on investing in NCDs vs FDs.

    Hope you are doing fine…
    BR

    1. Thanks for the idea – I saw the news about them filing the prospectus a few days ago, but didn’t realize they will launch so soon. Let me write a post on that this week. Thanks for bringing that to my attention BR!

  75. I enjoy your informative posts and have learned a lot. I am a MF investor and have done lumpsum & SIP in various schemes. I understand that we must track these investmetns at regular intervals and exit the non-performing funds. I really do not know how to go about it. Please do a post this topic specially covering SIP investmens.

  76. hi,Is it posible to do the trading by buying fhysical gold (coin or biscut)and sell in the market the next day of the marketprice.By that way i hope we can avoid mediator.Please let me know the advantage and disadvantage.

  77. Dear Manshu,
    There is very simple excel file in which one can track MF/ETF portfolio.
    It is freeware & available as download from net.
    One can enter purchase details in it. User has to go once in a day on net. While on net, if you open file it automatically updates data of all MF & ETF from amfindia.com & accordingly populate your portfolio to see gain/loss. I have made little modifications in it.
    If you wish let me know where i can send. SO as you can check & share with your all users if feel useful

    kishor

    1. Dear Kishor,

      Thanks for the offer. You can email me at onemint at gmail

      I’ll take a look and upload it here if and do a post or share it with people in the weekend links. Thanks!

  78. Hi Manshu,

    Am a avid reader of all your posts. You are doing a wonderful job. Keep up the good work.

    Can you do a post on the working of Value Investment Plan (VIP) and which mutual funds in India are offering this service. Also can you compare VIP with a Flexi SIP option provided by some online trading portals like Sharekhan.

    Thanks and Regards,
    Krishna.

  79. Topic: Calculating STCG & LTCG for Debt & Equity Funds

    Lots of personal finance blog, including this one, have talked about how tax affects different types of gains. However, none of them mention how to go about calculating this gain amount. Employer provides Form 16, banks provide Form 16A, what do MF provide? Specifically, is there any smarter way to calculate capital gain rather than manual calculation for each transaction one-by-one looking over year’s statement?

    I think calculating capital gain manually is simply way too complicated. For example:
    1. In case of SIP and SWP, different units are invested for different period.
    2. Definition of equity fund is one which invests 65%+ in equity. How to calculate this figure, specially for hybrid funds? This is import to know whether LTCG will be exempt or not.

    So, in all, is there an smarter way? Do AMCs provide such statement? I didn’t get any for last fiscal.

    1. I’m afraid I don’t know of a better way to do this Ashish – to the best of my knowledge, no mutual fund or brokerage provides such a statement and it is up to the investors to do the calculation on their own.

  80. Hi Manshu,
    I am a frequent reader of your blog! I like the way you analyse financial products.
    Can you please help me out?
    Could you please detail me with iMaximize ULIP Plan? Can you please write a blog post on the same?

    Thank you in advance

    1. Thank you Heena – I generally stay away from writing or analyzing ULIPs because I’ve not come across a good ULIP product yet. My recommendation would be to buy a term insurance and mutual funds instead. Keep your insurance and investments separate, save on cost, and simplify your investment. Also, I’m curious to know what prompted your interest in this product?

  81. Hi Manshu,

    Would like you to shed some light on how to invest for dividend gain in shares. What prompted my question is the recent announcement by JB Chemicals of a special dividend of Rs.40 per share wherein the share itself is trading at Rs.140 currently. Sounds very mouth watering but i have myself burnt my hands in the past with Rajesh Exports.

    Would you be able to explain the process on the record date, when should one invest to become eligible for the dividend payout (days before the record date), what should be the strategy with such investments ex-dividend, whether it actually makes sense to invest in such shares,etc…

    I am sure it will help a lot of people including me because a good understanding will lead to a profitable decision which might include not investing at all (and thereby curtailing losses)

    Thanks

  82. Sir,
    the share prices,crude oil prices all over are falling,but I wonder why US dollar prices in terms of INR are raising.please explain.

    1. The USD itself is rising against all currencies and that’s because it is considered a safe haven asset, and big hedge fund managers and investors are demanding it and pushing the price up. The same was seen in Swiss Francs which moved up before the Swiss government said they won’t allow it to appreciate any further, and decided to buy as much foreign currency as necessary in the international market.

    1. Yes Hari – you can ask your broker like ICICI Direct to enable overseas trading in your account and with that you can buy ETFs listed abroad. I haven’t done this myself so don’t know the mechanics of it but it is doable.

  83. I suggest the following topics:-
    1. E-gold vs Gold ETF Pros and cons of both
    2. E-Series products from NSEL. Should you go for it?

  84. Can you compare the performance of various Indices over a period of time? We can easily comparison of various MFs in different sites, but if I ask the question, has BSE-200 performed better than CNX-500 in the last 5 years, there is no answer.

    The objective of such an exercise is, if we know the best performing index, then we also know how the funds have performed in comparison to the said index. And if already have an index fund linked to that particular, that would be my best investment vehicle, no ??

    1. I can certainly try that, but I’m not sure how effective that would be. I say that because of two reasons – first, the indices that have done well in the past few years may not do so well in the future given their different nature, and second – in India, there are quite a few mutual funds that have over performed the indices by quite a bit. Regardless, I’ll try to research this.

      1. Hi Manshu,

        I agree with you. Past performance is not a guarantee but it might give some hints on why certain indices perform better than others ( and I am not looking at sectoral indices at all).

        Secondly, I read The Hindu BusinessLine Investment World feature (on Sundays) for MF review/recommendations. In those reviews, they frequently make a generic comment that “xyz fund has outperformed the CNX-500 index, which is a tough index to beat..”. So I wonder if this index is so tough to beat by a diversified active fund, then I am better off investing in Benchmark’s CNX-500 Index fund, isn’t it?

        1. Hi Ashok,

          I really don’t understand what they mean by that – how can one index be harder to beat than another? These are all free float based market cap indices and the differences between them is the area that they try to cover. While Nifty captures the biggest 50 companies, CNX 500 tries to capture most of the market cap – if two funds have these benchmarks, I’m not sure how they can say that the fund that beat the 500 had a tougher job to do than the fund that beat the 50.

          I think they must mean it in a more generic way that beating an index is difficult and that the particular fund has been able to do it. I’m going to collect some data around this, and we’ll discuss it.

  85. Hi Manshu,

    Can you cover about various features in the corporate bonds in one article? Particularly the callable, convertible and puttable. My main query is in callable when the bond can be traded on secondary market. If the bond is trading in the secondary market, how the issuer get benefit?

  86. Hi Manshu,

    After some Googling, I got a link to one of the BusinessLine articles ( and I have read the same statement in Business Line few more times) :

    http://www.thehindubusinessline.in/iw/2011/01/09/stories/2011010950300500.htm

    QUOTE: For one, while our recommendations did work well on an average, we did find it hard to outperform that tough benchmark — the CNX 500 index. UNQUOTE.

    Which means the mutual funds recommended by Business Line failed against CNX 500, though they may have outperformed their individual benchmarks (otherwise they wouldn’t have been recommended).

    By the way, if I do the research and send you the article, then do you publish it on your blog?

    1. I read that article and I think they are using CNX 500 as a proxy for the whole market because that covers I think around 98% of the market cap of the whole market. I’d be happy to publish anything that you send but for this one I can do the research myself, I have a fairly reasonable idea of where to get this data so it shouldn’t be a big exercise. Thanks!

  87. Sir, can you please explain about different ways in which a social group can register (NGO/ TRUST/ SOCIETY) and their pros and cons.
    Also, is there any way in which a group can register as a company and still be explicitly recognized as not-for-profit ?

  88. how equity shares prices are affected from derivative? is there any technically impact of derivative( future and option) on equity shares? how can the increase/decrease in open interest,volume,put/call ratio can impact on the price of equity share technicaly in swing trading?

  89. I have read some of your post which is very helpful understanding the basic of market. Can you also post some thing on Technical analysis of stock .

  90. Recently I deposited a Gift cheque of American Express Bank $10 in ICICI bank.I have got Rs 135.I understand that the approximate value of $10 is Rs 450/-.Thus the Bank has charged Rs
    315 as commission.This amounts to 70%.Kindly let me know the proper way to encash gift cheques in doller.

    1. Not to me it doesn’t – investments should be diversified and goal oriented, and paying premiums on insurance is not a good enough goal to drive your investments.

  91. ICICI direct.com plan to increase their brokerage charges for delivery and Margin products from next month. I just Google to find out the current brokerage charges from various DP, but I was not able to get the comparative charges in one site. Do you have any information in this regard. what will be your choice for best trading platform available currently in term of
    1) Service
    2) Charges

    Regards
    Praveen

    1. I’m afraid I don’t have this information and don’t plan to do a post on this any time in the future. I started out doing this a year ago but found that the info is not easily accessible and even when it is – it’s not directly comparable. Plus there is no way to compare the service levels (as far as I know).

  92. Hi,
    1.Can a charitable trust made as the nominee in Mutual funds? If yes what are the documents that needs to be submitted. I asked a few AMC’s they are not aware…

    2.Where can i get the historical P/E Values of all sectors of Indian Market? What are the average P/E values of all sectors in India? Is it an important factor for deciding the stocks??

  93. Sir,

    I am Rajeshwari actually i want to invest in Gold fund in SBI Bank somewhere i am not getting a clear knowledge in Gold fund and also Shares, Mutual Funds. How the common man can know these things? Can you explain me clearly. The basic things that if i invest Gold fund how i will get the returns, what all the things will be there? What all the things must and should i want to know? what is that unit price? How they calculate the returns? What are the procedures? Can you briefly explain me? Please.

    regards,

    1. I’m afraid there are just too many questions here and it’s not really possible to write a post addressing them all. You can subscribe to the site and go through the articles that publish every day and I think that will help you understand some of this but as far as writing one post that will explain everything I don’t think I can do that.

  94. Hi,
    You have become the financial magazine of sorts for me to keep myself upto date 🙂 Great job! Keep doing good!
    I have 2 questions, not topics probably.
    1) I like to repay my home loan by accumulating some money over the next 7 years. For this, I plan to to an RD for the next sa7 7 years @9% p.a. or so and then use that lumpsum to either pay or part-pay the loan. Is there a way to save on the tax on the interest for the money that is accumulated? I dont want to end up paying tax for something that I am saving to re-pay a loan. Is there any provision to help here? Does any bank where I take the home loan provide the possibility of protecting this, if I do the FD/RD with them?

    2) If there is a good magazine that you could suggest (online reading also) for financial news/views, what would you suggest?

    Best Wishes,
    Seshu

    1. Thank you so much Seshu – that’s a wonderful compliment.

      For 1 – no I’m not aware of a way to do this. Interest income is interest income and regardless of what you plan to do with it.

      For 2 – there are several – Business India, Business Today, Business Line, Economist, and Forbes India being the ones that immediately come to mind.

  95. Hi Manshu,
    1.I read your post on NSEL & E-Gold / Silver. As my city is not listed in the addresses of the Depository Participants, how can i go about investing in the same?
    2.A topic suggestion: ICICI Guaranteed Savings Insurance Plan.
    3.How about a list of websites & magazines with your views on their strengths for regular reading?

    1. Hi Vijay,

      1. I really don’t know about it – maybe someone like Religare has a mechanism to mail them the documents and they open the account for you or something, but I really don’t know about this.

      2. I have not heard of this project but will look it up now, and write about it in the future.

      3. There aren’t any special things really – I read the Business Standard, Financial Express, NYT, WSJ, Bloomberg as far as daily news is concerned, and then although I haven’t been able to read them for a long time – I used to like Business India, Business Today and Business World. Fortune India is also a good magazine and has a good online version. Blogs – I have more than 50 on my Google Reader and I hardly get to catch up on all of them but keep an eye on the headlines at least and read the stories that I find interesting.

  96. Hi,
    I enjoy reading your blog and look forward to your views on LIQUIDBEES.
    As a small investor, how well is this product to park funds instead of a bank savings account.

    This is my plan: Every month as soon as I get my salary, I will move most of it into the LIQUIDBEES. Then during the entire month, I will sell units as and when required for expenses and investment purpose. Over a large period of time, fractional dividend units will keep accumulating which I will redeem after an year or so. I’m assuming that my broker does not charge brokerage for buy sell of LIQUIDBEES.

    Is this a good plan? Will it actually make me some more money in the long run?
    Thanks,
    Aditya

    1. Yes your broker will charge you commission for buying and selling units as they are treated just like shares, and that will put a big dampener on your returns. My initial thought is that it won’t work out better than just having letting your expenses lay in the savings and investing the other part. It’s just too many commissions, and I see that Liquid BEES returned a 5% annualized return in the last 3 years, so it’s not all that high when compared to a savings account anyway.

      http://valueresearchonline.com/funds/newsnapshot.asp?schemecode=1787

      I’m not all that positive about the plan – I can do an entire post if you think otherwise, and let’s hear your ideas out here.

  97. Sir,
    From your post “Why can’t a country print money and get rich?” I could understand that putting more money in the hands of citizens/consumers will eventually soar up the price of commodities/services. But, my question is, why cant a country, not a part of common currency union such as EU, print money and settle its external debt? Also, the debt has to be paid sooner or later so why not by printing more money in lump sum or installments.

    1. Foreign or external debt is usually held in a foreign currency like in India’s case 52% of the external debt is held in USD, and India can’t print the USD of course.

      So, the other course of action is for India to print INR and use that to buy USD in the Forex markets but that won’t work because when you have a lot of supply of INR relative to USD – your currency will depreciate significantly, and you will have to pay that much more for your imports – like oil and capital goods. So, you can’t really print money without having these implications.

  98. Hi Manshu..

    I was wondering you have written any post on downgrades by rating agencies such as moody’s downgrade of SBI recently and how it could impact the company and what should investor do about it?

    1. No I haven’t and I don’t think it will have any impact on how SBI operates. I think regular folks like us are better off by looking at credit ratings as far as smaller companies are concerned but for bigger concerns like SBI or even countries – I don’t think the rating agencies have any info on top of what the market already knows.

  99. Hai manshu,
    Could you please tell me, as to how you create your website. I mean what tools, language or web script (i am not that much tech savvy so i dunno what should be the exact thing) you use to host your website. Like mysql, php, html etc., ?

  100. Hi Manshu

    There is a news that “Country’s largest fund house HDFC Mutual Fund launched HDFC Gold Fund”

    A Gold ETF NFO was launched by HDFC Mutual Fund recently. Will you please be kind enough to review this NFO. Is it linked in any way to the Gold ETF that is already managed by
    HDFC.

    Thanks

    Umesh

    1. Hi Umesh,

      Thanks for letting me know about that – I’ll review it this week for sure – yes it is linked to them, they will collect funds from their MF and invest in their ETF 🙂

  101. Iam a regular to this site and found interesting information on NCDs, ETFs. However I have a query from my cousin which is bit intriguing. He quit job last year, over some health issues and since recovering. His expenses are just met with earnings by way of FD interests etc…

    He has savings which he want to invest to meet his family expenses / saving if any. Since he is just around 40, Iam in dialemna of what product would suit his long term hiatus from job.
    I wanted to suggest MFs but experienced their fall along with Equities in past 1 year. My investment in ‘SBI magnum’ drowned. Iam in fix of what to suggest him.

    Would you suggest any better investment idea for this case.

    1. Sorry to hear about your cousin.

      I think you are on the right track with going for only super safe investments like bank FD. The only other thing I can think of is FMPs which are a bit more tax effective if at all tax planning is a consideration. I’d stay away from equities because those are volatile and can cause loss which will be hard to recover from in his case.

  102. Hi Manshu,

    What do you think of the new DSP Blackrock World Agriculture Fund ? I mean what is your opinion on the theme ?
    The underlying fund has done reasonably in the short duration it has been there ( 1.5 years ).

    http://www.dspblackrock.com/nfo/swfs/BGF_FundPerformance.pdf

    I am feeling interested in the Agriculture idea ( as high-risk high-return gamble) but also feel the timing may not be right because of the depreciated rupee. If rupee stabilizes at around 45-46, then I may go for it.
    Your thoughts?

    1. This is a fund of fund right? I’m generally wary of those because of the high expenses, and then the currency risk as you mention. Let me look at this a little deeper over the weekend and write something up next week.

      Thanks for bringing it up – it’s a great topic.

      1. Yes, it is a FoF. Also the underlying fund is an Actively managed fund. So expenses overall would be high.

        But it could still be a good investment into a sector which Indian investors are not exposed to at all.

  103. manshu
    i have a request to you regarding your previous articles of your blog….what i have noticed that browsing through the past article in your blog is not that easy….please can you archieve your previous article in month basis like other blogs…so that if anybody wants to read your blog entry from beginning and go through all the articles which are interesting and usefull to him…
    ujjwal

    1. That’s a great suggestion Ujjwal – thanks for bringing it up – I hadn’t thought of it but it should be something that’s easy to do. I have some other changes in mind as well, so will probably lump all of these together and try to get that done by next weekend.

      1. thanks manshu…
        now i can go through all of your article from start easily and increase my knowledge base….
        thanks a lot
        ujjwal

  104. Hi Manshu

    Please write something on the topic of HFT/Algorithmic Trading…
    How these are adding or hampering market efficiency or causing market abuse..
    Are retail investors getting disadvantaged due to big players using HFT.
    Should regulators be worried about HFT.
    What are the possible solutions..

  105. Hi,
    I have switched from one fund to another of the same mutual fund.Can I switch again within the same year? Will I be charged any fee? How often we can switch funds?

    1. Hello Mr. Gupta,

      Yes, you can switch again between funds. You will most likely be charged the Exit load from the first fund since most of the funds have an exit load if switched/redeemed within an year. Please check the offer document of the first fund.

      A switch is nothing but redemption from first fund and buying the second fund. So the charges applicable for both the transactions are applicable.

      It is not advisable to switch funds so frequently.

  106. Hi Manshu,

    Excellent site!

    Please do a followup post on FMPs esp. the tax implications due to DTC. Your earlier post on FMPs http://www.onemint.com/2011/04/19/fmp-taxation-and-fd-comparison/ is from April this year. I suppose some things are more clear now that we are past the middle of 2011-2012.

    How does one decide the maturity of FMP? Is it better to go for 3 year FMP v/s say 369 day FMP? Also, please discuss the concept of “indexation” in a little more detail.

    Thanks again. Keep up the good work.

    1. Thanks Vikas – glad to hear from you.

      As far as I know there hasn’t been any progress on the DTC front – the govt has been busy with other stuff lately 🙂

      I think indexation and FMPs in general are a good topic, and I’ll try to do a post on them in the future.

    2. Thanks Vikas – glad to hear from you.

      As far as I know there hasn’t been any progress on the DTC front – the govt has been busy with other stuff lately 🙂

      I think indexation and FMPs in general are a good topic, and I’ll try to do a post on them in the future.

  107. Hi Manshu,
    I had a couple of questions:
    1. I am reading that BHEL will soon be coming out with an FPO. I would like to know if an FPO is a good sign for a small investor to invest in a company? How different is it from an IPO?
    2. Tata Motors has split recently from a FV of Rs. 10 to Rs. 2. Is it possible for any share to be split any further? As in, can it now be split into an FV of Rs.1 for instance?
    Thanks,
    Amar.

    1. Hi Amar,

      1. An IPO is an initial public offer which means that’s the first time a company is offering its shares to the public. An FPO is a follow on public offer which means that the company has offered its shares to the public and will offer some more of them now. It’s quite similar in the way the process works. On its own – it’s neither a positive or negative sign. It depends on which company is coming out with the offer and at what price. This market has not been good for a few years in India, and I think except for Coal India – you could have bought the IPO / FPO of every other company at a lower price than what was offered during the issue.

      2. Yeah, they can go down to one rupee as well.

  108. It would be interesting to discuss perpetual bonds (or perps) some day. I saw a bunch of them being advertised today (Tata Power, Tata Motors and Dewan Housing). There seems to be some risk in investing in these bonds, so I wanted to know if there’s any pros/advantages to balance it out.

  109. Please give opinion on quantum mutual fund & ther phylosophy.Why ther aum is less then other mutual fund amcs?May the low aum affect on return?

    1. Probably because they don’t market as aggressively as some of the other guys. They don’t affect the returns of the funds and this is shown by the gold ETF and a few other funds that I have reviewed here in the past. I don’t think there’s anything more to it so I won’t be able to do a full post.

  110. Hi, my first appearance here!
    You have amazing knowledge and especially amazing skills to express that.

    I’d like to suggest you to write about a new style of trading : Pair Trading

    Thanks.

  111. Hi Manshu,

    I have been thinking of buying another term insurance for myself. So had asked my agent to send me a quote for 35 lakh insurance. He had sent me the quote. Along with that he suggested that i take a look at LIC’s Whole life Limited payment with profits policy. Instead of paying 13.5 K premium for 35 years, he suggested i pay 26K for 40 years for a sum assured to 10Lakh. But his logic was that in the term policy, there is no survival benefit or a maturity at the end of 35 years but in this whole life policy, if the person insured survives upto 80 years of age, approx returns would be as follows:-
    TSA – 1000000
    Bonus – 3500000
    FAB – 3350000
    Total – 8050000

    I have always believed that the term insurance is the best form on insurance… But just wanted to take people’s opinion about this plan before finally taking a term insurance. Please suggest.

    1. But this is all assumption right? I mean only 10L out of this amount is guaranteed and the rest is based on what returns LIC generates right? And that could change 10 or 20 years down the line, and the final value may not look like this at all – am I correct?

      And if you already have a term plan from them then it might even make sense to get a cheaper plan from someone else. I’ll do a full review but it might make sense to look at cheaper options.

      1. Yes, only 10L is guranteed and rest all is basis assumptions based on current profits of LIC.

        Regarding cheaper plans from other companies, somehow i trust only LIC. Everytime i think of taking an insurance from any other player, i am reminded of the post which u did on comparision between all players on rejection rate. Wouldnt want my family to go thru any hassles…

        1. Okay, see then that makes a lot of diff, if only 10L is guaranteed and the rest depends on interest rates and bonuses then I’d do an IRR of how much extra they can give me and what the rates currently are and compare it like that. If its just assumptions and projections then you have to keep that in mind. When I do the post on this which should be this week I’ll use the examples from their page and see what return they’re talking about.

          Other aspect is that if you already have an insurance from LIC then you could consider taking it from one of the other players because people in the know say that once you have split up insurances and one insurer pays up, it’s that much harder for the other insurer to reject the claim.

          1. Your last point on different players makes lot of sense. I had never thought about this in this manner. Brilliant insight! Thanks a ton buddy… But am still eagerly waiting for your post on this 🙂

  112. manshu…
    i am still not able to clearly understand how the SENSEX and NIFTY is calculated…also how its EPS and PE is calculated….will you please make a post with a real example say Nifty of 28 th october with your simple language….it will be helpful to lots of novices like me…
    ujjwal

    1. Hi Ujjwal,

      I’ll see if I can do such a detailed post or not – this requires a lot of data, and I don’t know if all of that is accessible or not. For example, you need something known as a divisor for the Nifty – that is a number that takes care of things like rights issues, bonus issues etc. and makes sure that those things don’t affect index calculation.

      Then even basic things like what was the market capitalization of the Nifty constituents on 28th October. I see BSE publish that but I haven’t seen NSE publish that, and even if they did – do they do it on the free float market cap basis.

      Then for the EPS, you need to take the EPS for all 50 stocks, and that too I don’t know if they take the trailing EPS or last year’s EPS, and my guess is that each exchange takes a different one.

      Sorry for all the jargon, but I wanted to emphasize how much data is required to do the kind of thing you’d like to see, and I’m not sure if all that is available or not. I’ll give it a try but this might take quite long.

  113. This query is basically regarding investing in mutual funds online.
    1. Moneysights have recently started a service of investing in mutual funds online. I wish to know your opinion on this. My doubts are especially pertaining to the annual fees and the payment on each SIP transaction I have pasted the link below:
    https://www.moneysights.com/home/moneysights-services-of-Buying-selling-top-performing-Indian-mutual-funds
    2. Also what is the best way of investing in mutual funds online. Should we go to individual websites of each mutual fund and invest. Or is there any other website that allows investment to various mutual funds. (At present my demat account allows only lumpsum investments to mutual fund and not my preferred form of investment i.e. throught SIPs) Or just doing it through a bank.
    I would be grateful if you could answer my queries. Thank you for your time. Sujatha.

    1. Sujatha,

      MS recently sent me an email letting me know about this scheme and I actually commended them to keep the pricing so simple that everyone can understand it and not have the fear of getting screwed by something that they didn’t see coming. Frankly, I haven’t used this platform, and can’t say for ease of use or other aspects, but it looks pretty low cost to me.

      I haven’t used anything other than ICICI Direct and that too a long time ago. I think they used to charge a lot more than just 10 bucks.

      If your broker doesn’t allow you to invest online in cheap way then funds india and moneysights are the only two options that I know of – there might be others but I don’t know of them. As for the best way – I think that depends on how many you want to buy, whether your KYC is done, what amounts you’re investing etc. and a generic answer is tough for that. Let me think about this some more and I may do a post on it in the future.

      Thank you for your question.

      1. Was going through the Funds India website. For online investments, they charge something called the “Trail fees” which comes to around 0.5% annually. What is this fees? Who would be paying them this fees if the investors are not asked for the same. In case of moneysights, the investor is being charged “Annual charges” + “Lumpsup / per SIP charges”. Will Moneysights be also getting this Trail fees? Which options comes out to be cheaper for the investor? Any insights on this?

        1. Hmmm trail fee used to refer to fee that mutual funds give to their agents, and was deducted from the NAV – part of the expenses. Investors never see this directly. I have a faint recollection that this was stopped but I guess I am wrong based on what you have said. But, regardless, if there is a trail fee then that will deducted from the NAV regardless of how you invest the money.

          Can you give me the link to their page that lists out the fees?

                1. Vishal – I looked at this some more and as of now I’m not satisfied that I can do a good comparison between the two sites because I feel that the difference in price is negligible while the real difference is in the level of service offered and I have no way of gauging that right now.

    1. Well, they should allow that to happen, but haven’t allowed it fully yet. Ultimately someone has to pay for all the oil that has been consumed. There is no free lunch. The lesser role the government has to play in the economy the better it is.

  114. Hi,
    1. Following the deregulation of savings bank interest rates,will the banks continue to give us the interest for whatever amount remains in the account for whatever number of days or will they go back to the minimum balance amount inthe account for the entire month?
    2.Some banks have started charging exhorbitantly,recently, (for example,.Rs 300/- as ECS mandate for SIP of Mutual funds as charged by Corporation Bank recently)) for some services,will it continue? or will there be some relief?

    1. 1. Whatever amount remains in the account for whatever number of days – the daily balance method.
      2. Hard to say, but my sense is that this is a competitive market and you shouldn’t see a lot of this type of thing.

  115. Hi Manshu,
    I would request you to do a post on schemes that are being offered by various companies promising high monthly return on investments. For example one co is offering Rs 1500 pm on an investment of 50000 that works out to 36% annually, which seems unrealistic. My husband is keen on investing in one of such scheme but I feel that such an investment is like a ponzi scheme and highly risky. I am unable to convince him and I hope that your post will help.
    One such company city limousine was in news recently. Please see
    http://www.mumbaimirror.com/index.aspx?page=article&sectid=2&contentid=20090916200909160200270091a0a1dd

    1. It is highly unrealistic and unsustainable. All these too good to be true stories tend to end badly, and you should try to keep him out of it or at least invest very little money. The problem however to write about this is that there isn’t any info before hand apart from the fact that they are too good to be true to show that it will end badly. One has to use common sense and see that if they can generate 36% and give that to you that means their own profit is much higher than that – maybe 40 or 50% – not even the best of companies have such high profit margins so how can this one be and even if it did why would it share their secret with others and let competitors on to such a thing?

      This is more common sense kind of thing than advice Nargis and the article link you send also shows that because a lot of people are blinded by the promise of high returns and aren’t listening even now. Scary.

  116. Can you please post article on sweep in accounts offered by baks. Where my saving account money will move to FD’s after reaching a level automatically.

    Thank you

    1. Wow so many links – I’ve written the post based on my understanding, and these links may have a lot more info in them so you have to combine them and form an opinion. There is not much more than I know which I can share in another post I’m afraid.

  117. What would your thoughts be for an outside India investor to invest in India?
    Any particular good funds with a good track record.
    Looking from the outside it does seem like infrastructure, food and water projects look a good long term investment.

  118. As a invester in Indian stock market it will be great if you can please give us a post on CAGR of leading companies say the NIFTY list.

    It will be a good pointer for investors specially small investors / beginners.

    Eagerly look forward to hear from you.

    Warm regards, ….. George

    1. How will that be useful information? That doesn’t make much sense to me – what will you gleam from looking at the CAGR of Nifty stock prices? You can just look at how a Nifty Index Fund did for the past few years and that will convey more or less the same information.

      I won’t be making this list because I don’t see the utility in it but if you had something in mind on how this will be useful then please share that and we can discuss that. The data is in fact quite easy to get. You can get it from NSE or even Google Finance. It’s the utility that is a bit questionable in my mind.

      What exactly is it that you are after?

  119. Hi Manshu,

    Some facts.
    Petrol in debt ridden Pakistan is 39 Rs per Litre.
    Bangladesh its Rs per Litre.
    Sri Lanka its 44 Rs per Litre.
    In China and Vietnam its 38 Rs per Litre.
    Why in India it is 71 Rs per Litre.

    Regards
    Arun

    1. I don’t know how these countries are pricing their gas, but the simple thing is that if international crude prices go up then India has to pay more for oil also and that increases the price of petrol. Government can probably reduce the taxes on oil but they have to collect that revenue from somewhere else. Brent Crude has gone up, oil company’s deficits have gone up and that has to come up from somewhere.

        1. It was not my intention to be brutal 🙂

          However, it is a bit exasperating to encounter this “best” question repeatedly, and in most cases the original commenter doesn’t bother to respond to me so these days I’m not really all that inclined to write a long story that I have repeated several times already.

  120. I want to understand the dynamics of various types fixed income mutual fund. Should we invest in it as oppose to Bank FDs. Why if yes (or no)? I understand there various types, mainly based on maturity period. In what conditions should one choose each type? When is the best time to enter into these MFs (for example, best time to enter into an equity based MFs is when market is low .. and of course I understand that we shouldn’t time the market but use SIPs instead). I also want to compare MFs against similar ETFs .. for fixed income. In the end which ones are best and why.

    I know lot of questions. Thanks for your efforts.

    Gaurav Jain

    1. I have a post on comparison between FMP and Fixed deposit here http://www.onemint.com/2011/04/19/fmp-taxation-and-fd-comparison/

      I think as far as longer deposits are concerned – that article covers the topic. For the shorter deposits since savings banks now have 6% or so interest rate the lure of liquid funds is that much lesser.

      I won’t write anything on timing and I have written about MFs and ETFs several times but I guess I need to write a detailed post on comparing the features of the two generically.

      Thanks for your ideas.

      1. All of my questions are related to interest bearing (as oppose to equity investment) MFs / ETFs / FDs . I do understand difference between MF and ETF from equity perspective.. Only want to understand it when it is taking about fixed income / interest generating investments (e.g. Liquidbees).

        1. ETF is just a legal shell – so there is no diff b/w ETF & MF based on whether they are equity or debt – that is not really material. The material part is what they own, which when I think about it now is what you seem to be interested in.

  121. Thank you for your blog & articles, they’re really wonderful.
    Could you please throw some light on world economy, USA / Europe / Greece/Italy and where does Indian economy fit in.

    Thank you,
    Kishore

  122. I like your articles very much – they are very informative. Keep up the good work!
    I have a query – please try to give a convincing answer if possible.
    I invest in mutual funds by SIP only and in stocks directly. My SIP in mutual funds are for long periods – ten to fifteen years. I have read a lot on rupee cost averaging and the power of compounding but I am not convinced whether I should let a SIP in a particular MF run for so many years or book profits in between. I review my portfolio every six months. What if the SIP
    ran for so many years and finally the MF performance plummets as it happened to
    SBI MSFU Contra and Reliance Growth funds? I had been investing in these MFs for the past five years but feel that I should have booked profits earlier.

  123. I have few topics for Suggestion.
    TOPIC :
    1. Financial Liberalization- What has it really meant ?
    2. Interest rate regimes across the countries.
    3. Investment regimes across the countries.
    4. Why service exports are increasing more than merchandise exports? What are the reasons?

    1. I’m afraid if I write about these topics they will be mere opinions rather than facts because that;s the nature of the questions. I think if you asked ten people why they think we are doing well in services as opposed to exports you will get ten different answers.

      I don’t feel up to it to write on these topics.

  124. Hi Manshu –

    I am 30 yrs of age and a relatively new entrant to direct equity investing. I have been regular with SIP MFs. Additionally I am also diversifying across different assets.

    With respect to direct equity investing, I have been trying to create a position by buying on dips and selecting large cap companies mostly. As part of my long term strategy, I am interested in buying high dividend paying stocks over the years so that I get a continuous stream of revenue going forward. However I am unable to pick or identify regular high dividend stocks of good quality. Can you pls guide me on the same?

    Thanks,
    Mani

      1. Thanks Manshu! I will go through this list. It helped a lot. But I think that I get the answer after reading through the post.

        Thanks,
        Mani

  125. Hello

    Thanks for your wonderful blog. Few things i would love to learn

    1. Our inflation had gone up from 5 to 10% approx, but the growth forecasts have not come down by that much ( less than 2%). Why?
    2. Ratings and Risks associated with Indian Banks
    3. Risk associated with mutual fund houses
    4. Real estate registration & taxes in various indian states.
    5. Percapita Vs Petrol price (International & National)
    6. Growth history statewise
    7. Growth history industrywise in sensex
    8. Fiscal Deficit Vs Growth

    Hope to see some info from the above if found logical. Thanks in advance.

    Regards

    1. Inflation was already high when growth was estimated and the effect of the recession was also receding so that’s why it might feel like it hasn’t been revised as low as it should have been. In any case – I do think the GDP will be revised lower than what has been estimated.

      For the other topics, I think these are good research topics for a student to go there and collect data but since I already have such a long list of topics that have immediately actionable information – I don’t think I’ll be able to tackle what you suggest.

      I think the data may not be available in a few cases as well.

  126. Hello Sir,
    Thank you for this informative blog. It is very helpful to me if you post something
    about this topic.
    1. FUTURE CONTRACT. (Finance)

  127. Dear Manshu,

    I am not sure whether we have an article about the PPF in post office saving scheme in ONEMINT. If we dont have an article can you please write about it. Also if there is an article please share the link.

    Thanks.

    Karthik – Chennai

  128. Money Managament Software, which manage all the investments of all the family members say users like FD in various banks, Bonds, RD, KVP, NSC etc for all members and also warn me for the interst earned in each financial year for all family members.

    Is there any software like this available ?

      1. Manshu,

        I aware abt prefios and Mprofit is not of my use.
        I need desktop version, no online business.
        Do you suggest something.

  129. I am not familiar with investing approah. Only after reading your mails regularly, iam getting to know the factors to be considered for investing. still i am in the early stages of learning.But i had been investing in some shares and mutual funds before simply on the advice of others. I have lost track and the papers which are available with me are confusing. I do not know how much i have invested and how much i have lost. can you suggest me how to read my portfolio and understand. Is there any software which guides me through this mess and enables me to approach this investment systematically.
    regards
    ganesan

    1. Hmmm this shouldn’t be all the difficult – all stocks and mutual funds are Demat right? And do you get Demat statements or you know how to check them online?

      1. All my investments are in de mat except one gold etf. But guide me how to access my account via internet. the statement given by the demat service provider in chennai is not clear.

        1. Gold ETF has to be in Demat – there’s no other way to hold it. Look at your statements and it should be there, maybe by a name that you don’t recognize. You should have a list of holdings with names in your Demat statement and that’s all you need.

          I don’t think anyone other than your service provider can tell you how to access it online so call them and get their assistance. But I think your statement should enough. Just copy paste all the names here and I’ll let you know how to find their current prices.

  130. The concept of special interest rates on FD of a specific tenure has been here for quite some time. Ex. ICICI offers 9.25% on 390 day deposit but only 8.25% on a 391 day deposit. Is this just a way for them to get better focus on certain tenures and be able to reduce asset liability mismatch or is there something more to it?

    1. I’m sorry I won’t be able to write about this because I don’t know why they do this. I’ve asked a few people that I thought would know but even they weren’t able to come up with a satisfactory answer. I don’t think it’s because of the asset liability mismatch because everything close to that maturity should come up to the same high interest rate in that case.

    1. To be honest, I’ve never heard of these products 🙂

      I’ll try to review them in the future. Right now I have 17 drafts that I’d like to get finished first 🙂

  131. it appears that the dtc might not be passed this fiscal, in that case doesn’t this mean it’s better to invest in fmp’s and other mutual fund products compared to co or bank fd’s.

  132. This is about the tax liability of income received.I pay Rs 4 Lacs to my wife thro a cheque.She invests the amount in Bank FD and earns interest of Rs 36000/ in a year. As I understand my wife need not pay any tax on Rs 4 Lacs she has received nor she has to pay any tax on Rs 36000 interest she has received.Only I have to pay tax on Rs 36000 interest which she has earned.Is my assumption correct?

  133. Dear Sir

    I am a regular reader of yours. I find them very interesting and informative. i also have a little question for you.

    Can you tell the better investment between PPF and bank FDs. Also the implementation date for the increased limit for the PPF account.
    One more thing, is it advisable to continue the PPF for another 5 years after completion of its tenture of 15 yrs.

    Thanks & Regards

    Prashant

    1. Better investment b/w PPF & FD depends on how soon you need the money really. With PPF it’s locked for 15 years right so even if you earn more in PPF – the fact that it’s locked for such a long period will surely come into play for a lot of people.

      I will schedule this post and write about it in the future. Thanks for the suggestion.

  134. Hi Manshu –

    It will be great idea if you can post a topic on “How to read Balance Sheets?” of companies. I understand that it might be a complex topic. Probably you can stagger it across few posts.

    I went through the archives as much as I can but couldn’t find something on that topic. Pls let me know in case I missed any post on that topic.

    Thanks,
    Mani

    1. Hi Mani,
      Thanks for the suggestion – that is indeed a good idea thought slightly complex and will have to be staggered as you suggest. I’ll write on it though it may take time because there’s already quite a bit of back log here.

      Thanks for your suggestion.

      1. Thanks Manshu for considering the request. Surely I can wait until you get through the other items on your list. Meanwhile do you have any books to recommend on this topic for beginners like me?

        1. Any book that they use to teach finance 101 in MBAs will be a good start – I can’t quite recall what the name was of the book I used but you could pick one up that’s easily accessible to you.

          I’d also recommend reading Prof. Aswath Damodaran’s website and blog to help with this. You could start that immediately and he takes real examples which makes it really interesting.

          Here are the links:

          http://pages.stern.nyu.edu/~adamodar/
          http://aswathdamodaran.blogspot.com/

  135. I would like to request you to post your views on different types of Mediclaim policies , benefits of having it in early age other than tax benefit, also expect your views to have a policy from Natiolised Insurace co. against private Insurance co.

    Regards,
    Shailesh

  136. Not sure if you’ve already done so before – can you publish a post on home insurance? Especially, what are the options available, what risks are included/excluded etc. Thanks in advance.

    1. That’s a good idea Mandar – I have no knowledge of home insurance but I think it’s time to look at some policies and learn a bit about it. I’ll try to write a post on it in the future.

  137. Portfolio for a Modern Indian

    Hi Manshu,

    You seem very knowledgeable about most of the Indian investment opportunities and your blog seem to attract quite a lot educated persons too. Why don’t you start a collaborative (probably first of its kind in India) model asset allocation and diversification post for an average middle class Indian?

    There are so many avenues of investment but people in India still struggle to find the right balance in their asset allocation to achieve that peaceful and prosperous retirement fund after 25/30 years. Many of them don’t even know about the demons of inflation, taxation and investment costs etc.

    I know one shoe does not fit all but collaboratively (with data backing up) we can find a model portfolio for a single regularly earning individual which can be extrapolated by anybody interested according to his family composition.

    Given that DTC is coming in effect next year and it is going to stay for a long long time, we pretty much know the implications for various investments.

    We of course wont suggest any specific investment instrument like a specific mutual fund or a stock but a general idea about how one should go about investing to get an optimum return at the start of the retirement. And since it is collaborative, with a proper disclaimer I don’t think anybody is going to hold you accountable for anything.

    What do you think?

    (btw, I might also start the same on my upcoming blog but wanted to use your platform)

    1. That’s a good idea but it’s much beyond the bandwidth I currently have and I think people will need so much customization that the time spent on constructing one is better utilized in reviewing different products. Plus I’m not too keen on collaborating with anyone right now because I like to do things on my own schedule as far as the blog is concerned.

      But all the best in trying to do this with your blog.

  138. Hi Manshu,

    Thanks for the interesting and informative posts. Have one question-

    I want to invest a lumpsum amount of money to generate some monthly income for my parents after their retirement. They will be in lowest tax bracket. A comparison between different available options (return%, ease of maintenance etc) will be greatly appreciated.

    -ARC

    1. Hi ARC,

      That’s a good suggestion – I can think of only two options right now – Senior Citizens Saving Scheme (Post Office) and Senior Citizens Fixed Deposits (Banks). The other options that come to mind like annuities of insurance companies or other monthly income plans don’t yield that well. Let me look at this in detail and write a post on this.

      Thanks!

      1. Thank you for taking time to reply me. I will look into details of those 2 suggestions you mentioned. What’s your opinion about regular monthly redemption of a Growth debt based mutual fund as an indirect method?

        I think a detail post on this topic will be helpful for many people.

        1. It adds complexity and uncertainty and if the tax bracket is not high then I don’t think that’s worth it. As a matter of fact I did write FMPs in my original comment but then I deleted it because first you don’t know what return you will get and second the main lure for these instruments is that they are tax efficient but in your case that might not be a factor at all.

          However, I think your idea does merit a deeper look and I’d like some time to think about it. Thanks again!

  139. There is a lot of talk about GDP .Can you please do a review explaining how GDP of India is calculated , what are the activities considered in GDP,who calculates it Etc

  140. Suggested Topic: How ” INFLATION” rate is calculated.

    Thanks for the subject how GDP is calculated. Similarly this subject of INFLATION may be explained in simple terms. Thanks regards.

  141. Please explain something about the processes that are being exercised in calculating Dearness Allowances for the Salaried Class

  142. hi,80ccf bonds gives rebate upto 30% of invested amount with maximum limit 20000 ie
    20000 for people in highest tax slab give effective return of 17% ie 6180 tax saved of 20000 and buyback option after 5 years gives 30780,
    the intrest is taxable,how the maturity intrest taxed……..?

  143. I am Suman. Can you please suggest me best Children Plan for my daughter future secure. My daughter age is around 1.9 years. What ever you suggest I will go with that. I wish to give best secure future for my kid.
    I am a middle class family only. I want to be a best father of my child.
    I am planning to pay 2000/- per month. Please suggest best plan for my kid.
    1. ICICI Prudential Smart Kid New Unit Linked RP
    2. Birla Sunlife Children’s Dream Plan
    3. Aegon Religare star Child
    4. HDFC SLIC Young Star Super
    5. Kotak Headstart Future Protect
    Thanks,
    Suman

    1. Thank you for the suggestion Suman and I appreciate your sentiment – I must admit that I have never looked at any children plans ever so I really don’t know much about them. I would say that it is not necessary to buy a children’s plan to secure your child’s future. You can very well do this by investing in PPF, tax free bonds, fixed deposits and diversified funds yourself. From what I’ve seen of insurance company’s investment products – they are a bit too complicated and don’t have all that attractive returns. I can look at these products but it will probably take me very long and it might be better for you to start investments in some safe debt instruments yourself.

  144. One of my friends, a senior citizen (63) is expecting a large inflow of money (Rs.5-10 lakhs in one or more installment) within a short period of say below 3-12 Months.

    He already owns a house but has income below the taxable limit of Rs.1 lakh. He has no loan liability.
    He wants to know the best possible SAFEST AVENUES to preserve this amount for at least 5-7 years with NO TAX and NIL RISK.

    Can you give some options / suggestions

    1. Mr Hariharan
      Senior Citizen savings scheme which gives a return of 9% pa is ideal. This can be opened in SBI or Post Office.This is safe and the returns are assured.

    2. Safest avenues are bank fixed deposits, postal deposits, senior citizens scheme as Mr. Ramamurthy point out, there are issues of tax free bonds that come out and though those are slightly higher risk than these other options, they are still fairly safe.

      But frankly, from what I see of the mindset of your friend – the best thing would be to stick with SBI FDs – that’s the safest thing I can think of and though they aren’t tax free – your friend may never hit the taxable limit with his earnings.

  145. I have got 50000 rs that can be unused for 6 months. Is it worth investing in liquid funds. My friends say let it be idle in savings bank because there is a short term cap.tax in liquid funds. Your guidance please.

  146. Hi Manshu,

    In the previuos budget there was mention of employers contribution into NPS can be accounted as business expenses & the employee also getting tax benefir under 80C. Has it become law, can i use it from this FY??

  147. There are thousands of institutions either employing people or form them into various groups of interest. Why they do not take group insurance policy with a benefit of at least Rs2.5 -5.0lakhs for life and Rs. 10 lakhs for Accident benefit.

      1. Please find below the details of the offer in short:
        Name of the Issue : Muthoot Finance NCD – Series II
        Issue Date : 22nd December,2011
        Issue Size : Rs.300 Cr + Rs.300 Cr. Green Shoe Option
        Period : 2, 3 and 5 years

        Interest Rates
        Annual Option : 13%, 13.25% and 13.25% for 2, 3 and 5 years respectively
        Cumulative Option : Double in 5 ½ Years
        Minimum Investment : Rs.5000 and multiples of Rs.1000 thereafter.
        Closing Date : 07th January, 2012

  148. Dear manshu,
    what is your opinion on elder pharmaceutical ltd? They have come out with FD scheme offering 12% interest.
    regards
    ganesan

    1. I have no idea about them, and I’m currently not inclined to learn more about them and write a post on their FD. That’s due to the large number of other posts that are lined up already, and the low appeal of this particular FD.

  149. Can you please cover a topic on TAN ( known as Tax Deduction Account Number) as many people are not aware of its existence.

      1. Please find the details of the offer in short:

        Name of the Issue : Muthoot Finance NCD – Series II
        Issue Date : 22nd December,2011
        Issue Size : Rs.300 Cr + Rs.300 Cr. Green Shoe Option
        Period : 2, 3 and 5 years

        Interest Rates:
        Annual Option : 13%, 13.25% and 13.25% for 2, 3 and 5 years respectively
        Cumulative Option : Double in 5 ½ Years
        Minimum Investment : Rs.5000 and multiples of Rs.1000 thereafter.
        Closing Date : 07th January, 2012

  150. Can you give some insight on some of the worst financial world crisis in the past . Let us take Mexico crisis of 1994, East asian crisis, Hyperinflation of Germany ( 1920) , Zimbwambe etc.
    This helps to see contemporary things in perspective

    1. That’s a good suggestion and I’ll try to write a post on it or at least link to other good posts that I find. It’s going to take some time though due to the several posts already lined up.

      Thanks!

    1. I think people should stay away from NPS right now (unless they are in government service) – it’s a good idea that has been ruined in the implementation by government and it’s not worth your time right now.

    1. Interesting question, and I think there was a comment here earlier about creating retirement income for parents – I think these two topics lend themselves well and can be written in a post. Thanks!

  151. What to keep in mind regarding financial planning when you are expecting a baby?
    What is the correct time to start saving for baby’s education, marriage etc.?

    1. Hmmm, well this is certainly new and I had never thought of this topic before…I’ll try to write about it though I don’t know how well it will come out. Thanks for the suggestion!

      1. This isn’t new, but maybe nobody asks it. Every would be parents have this burden. Especially if both are working and the female will have to quit the job, creating loss of income.

        1. Oh yes, I perfectly accept the need to think such a thing through and plan for it – I meant more in terms of if I am competent enough to write about this – but I will do my best.

            1. Yes cost of one income is gone in too high. You need to plan very carefully for it. And always have a backup plan. Circumstances change and you might have to join job before you planned.

  152. 1. A post on Nidhi companies (if not done earlier) can be done.
    2. I have invested in fd of unitech. Maturity amt. yet to be recd. even after a month. Pls. advise friends not to invest in this co. Pls. let me know to whom i can complain.

  153. I want to start MF,SIP but in my city there is no facility to deposit form in relevent bank directly. I called one agent and discused,he told that he would deposit my form in CAMP office ,this is also privet, my query are-

    1-How much mony will be dedected from my MF for agent and CAMP office and when either yearly or on every sip?
    2-How to diposit MF form direct to company (Bank)?

    … kind regards
    Vineet Gour
    7702243168

  154. Manshu
    Can you please do a post on “What are the sources available to Reserve Bank of India to buy US dollars to ensure the apprciation of Rupee via a vis Dollar and the mechanism RBI adopts to do this job”.This is of topical interest .

  155. Hi Manshu:
    Seasons Greetings
    Wish this site carries out in series, some articles, tools, or some advise /discussion on Financial Planning for people at different age groups: 20-30; 30-40, 40+ and also on retirement planning
    Best
    Srinivas

  156. Manshu
    Can you please do a post on “What are the sources available to RBI to bring up the rupee visa vis US Dollar and mechanism RBI adopts to do this job”.This is of topical interest as Re has steeply depreciated right now and is severely affecting Indian economy which imports more than it exports.
    Thank You

  157. Hi Manshu,

    Firstly, thanks for this very informative website.

    My query is : would it be a good idea to invest in any of the NCDs launched a few months back, which is trading at a discount to its list price? Please advise. (Example, I invested in Muthoot finance’s August’11 NCD for 5 years @ 12.25% and the same is trading now at Rs. 960. So buying an NCD now which is worth Rs. 1000 at Rs 960 and 12.25 % interest should not be a bad idea? )
    If so, could you please suggest some good options?

    Please advise.
    Thanks and best wishes for 2012,
    Kind regards,
    AG

    1. Hi AG,

      I think these are good options if you split your money and not take more than 5% or so exposure to just one company. If you already have Muthoot then look at something else – NCDs come all the time these days, and that way if one company goes under you don’t risk a large part of your money. The yield on these products is high for a reason and you don’t want to find yourself on the wrong side of that trade.

      Happy new year 2012.

  158. Manshu
    I made a comment under your “Suggest a Topic”requesting you to do a post on the mechanics adopted by the RBI to appreciate the Re vis a vis US Dollar about 2 days back. It also appeared under this column as a comment. Suddenly yesterday my comment has disappeard.This is the 2nd or 3rd time this has happened. Does this mean you dont want to this post? If so, I feel courtesy requires you tell this,please.

    1. No, no, no, why would I delete comments? That’s preposterous. And your comments haven’t disappeared either – you are just not able to find it. Here is a link to both your older comments:

      http://www.onemint.com/suggest-a-topic/comment-page-5/#comment-197161
      http://www.onemint.com/suggest-a-topic/comment-page-5/#comment-197355

      Just search for your name on the site and you will find your comments. You are just not able to locate them – that’s all – they don’t disappear. You had left such a comment on another post also and I had asked you to send me the email notification that you should’ve got. I didn’t receive any email from you.

      1. Another thing – when you leave a comment – it should display immediately. So at that time – go to the date and time next to it – right click it and save that link. Now, you can use that link to directly go to your comment any time instead of searching for it later on. I think this should solve your problem of disappearing comments.

    1. I normally don’t write about insurance + investment product because I believe it’s best to keep them separate. The same is true for this product as well and I won’t be reviewing it.

      1. Why dont u write an article that clearly underlines the uselessness of a conventional investment+insurance plans. I can see thousands still going for plans that offers 2% returns and half the requirement of insurance! Please suggest ways(if u can) to roll out and educate people about this. I wonder if why regulators dont have a moral responsibilty on this matter!!!
        I can see many of my friends still going for Jeevan Bhimas and Bhima Niveshs and the likes when they can cover themselves with a good term plan!

  159. Happy New Year MANSHU,
    It always nice to read from you.
    Can u please analyse and post about — IIFL Real estate Fund (Series1, A Units).
    Happy upcoming year, once again.

    1. That will be interesting but I’m not sure how I can get that data – I’ve never looked at it but let me see if the RBI website has something or if it’s present somewhere else. If it’s there I’ll be sure to write about it.

  160. Hi Manshu, I’ve been reading your extremely informative and well-written blog for more than a year. One thing I think you haven’t discussed much is retirement planning and pension plans. Many financial organizations have pension plan schemes, with or without life insurance, and often with options to adjust the debt-equity ratios. Any recommendations or thoughts on these schemes? Any thoughts on retirement planning in general?

    1. Hi Aditya – Thanks!

      I have written a bit about retirement, not as much as some of the other topics but there is a section with about 15 or so posts. You can check them out here:

      http://www.onemint.com/category/personal-finance/retirement-planning/

      In looking at the products, I’ve felt that the pure retirement products / annuities aren’t very attractive, it’s better to build a portfolio yourself. That will be more cost efficient and you will have more control over it.

  161. Manshu,
    Can you write a post on “DTC and saving options”. This would be a great information for every person.

    Regards,
    Samir Nigam.

    1. This is a great topic Samir and I do write about DTC related things from time to time – there isn’t enough clarity yet to say which options will be better to invest and once that clarity is there – I’ll do a post on that as well.

  162. Hey Manshu,
    Can we also have some study based on automation of Technical Analysis/Fundamentals/Quants etc. HFT strategies consists basically of Arbitrage but there are various brokers who after understanding that Arbitrage is not making money, are entering Non-HFT area of Algo Trading.

    1. This is actually the first time I’ve heard about this and I think I won’t be able to write about this in the near future because I don’t know enough about it. In a few months maybe….

  163. I have a query related to EPF withdrawal.
    If I have worked for a company for 4 years and 6 months and resign after that; how much tax do I have to pay if I withdraw the EPF amount.

    If I wait for another 6 months; which means that my EPF account would be 5 years old; would the EPF withdrawal be taxable?

    If I get it transferred to my new company EPF account and work there for another 1 year and resign after that would the amount be taxable if I withdraw it and how much of tax would be required to be paid?

    Thanks in advance!

  164. Give a case study/ format with arbitary figs. for filing Tax-Returns by a Retiree,past 60 years——-having FD/MIS of PO/NSC /PPF DEPOSIT /M.F. INCOME FROM DIVIDEND AND SELL /SHARE INVESTMENT /ELSS INVESTMENT/BANK SB A/C etc. etc.Also what is the max. slab of income for exemption of Tax Return Filing for people between 61 and 65 as also above 65 ?

  165. Hi
    I have 2 topics on which would request a post.
    First: How do Indians apply for Facebook IPO? Is it possible to apply in the first place?
    Two: I have shares of a LSE-listed company allocated as part of employee program. How does one redeem such shares? While my company has tie-up with natwest, I am just wondering how will I redeem these shares once I change jobs. Right now the share price is so-so but it will go up and the pound exchange rate also will help. So I want to keep these for long term irresepective of my job status

    1. I don’t think Indians can apply for the FB IPO. The way IPOs work in the US is different from how they work in India. Ordinary people can’t apply for the IPO stock. The banks sell the stock first to their clients which are large institutions and when they start trading in the market – that’s when everyone else gets to buy them. So, I don’t think there is any chance that Indian investors can participate in the IPO.

      For the second part – I’m not sure about that – I’ll see if I can find any info on that and will write if I find something.

  166. Would like to know about the new Transaction Charge of Rs 100 levied on every purchase in MFs. When I sell, will this be included in the purchase cost, or is it treated separately.

    1. I don’t know about Spice Jet but in general it’s not a good idea to buy shares based on announcements that have taken place a few days ago. Traders and other players who are interested in and knowledgeable about this space would already have bought the shares before and immediately after the announcement. I see it hard for the small guys to make money this way.

  167. Can you pls explain about preferential shares, what are they?, difference between Normal stock and this?. Why is the price too low compared to normal stock?. Are they entitled to pay fixed Interest/dividend?.. The reason why I ask is, I had 800 common stocks of Ispat limited but few years back, they converted 440 shares to preferential shares and the rest to common stock. I don’t have any clue of this. Appreciate your response. Thanks

  168. Saw an ad in the ‘MoneyLife’ magazine of a product called “Future Capital Flexi Gold”. The ad doesn’t give out much details. Just that you can invest as less as 1 gram per month, and can sell in an “exchange” (doesn’t specify which). Also says that the “units” can be converted into physical coins/bars/jewellery. This doesn’t seem to be an ETF.

    Surprisingly, though the ad asks us to visit http://www.futurecapital.in for more details, this site doesn’t have anything about this product.

    Know anything??

  169. hi,,,,,,,,
    Can you tell something about insurance.
    whether LIC of India is better then other private player.
    for both Tradition and Ulip plan.

  170. Hi,

    I have a query, I bought Muthuth NCD in secondary market, at a price of Rs 800, face value of this is Rs 1000, Now its trading below my bought price, what will happen to my interest and my maturity amount. will i get Rs 1000 per bond?

    Thanks
    Umesh

    1. Your interest and maturity amount will remain the same. There will be no effect on that as long as you hold the NCD. Those will only get affected if the company falls into trouble or something like that. The market price has no impact on the interest payments and redemption.

  171. Planning under 80C:
    What should be ideal idea to invest under 80C.. PPF, NSC, Insurance and other..? Give your ideal feedback to better plan your investment under 80C with good returns and lower risk;

  172. Hi,

    These days because of handsome return in debt fund many advisors are coming to sell debt funds. kindly suggest going forward when the interest rate scenario is going to be down side what are the good funds and what are the parameters to evaluate to these funds. kindly advise me some good bond funds since my target is not more than 10%

  173. How about an article on historical data analysis of Annual Inflation Rate and 1 Year SBI FD rates to check how long (and during what economic cycles) the real interest rates have been negative in India

  174. Now since the Govt has made Hallmarking for all gold jewellery compulsary, pls. post an article on how does this whole process go about and what we as a lay man should look before buying the gold ornaments so that we are sure about the quality. and pls do include whether the hallmarking is on sample basis or 100% hallmarking.

    Thanks
    Rakesh thakur

    1. I’m not familiar with this process and very little about gold hallmarking so I don’t know how much I will be able to write on that but I can give it a try.

  175. how to ensure the purity of gold ornaments we buy. how to check if the ornament we buy is truly hallmarked or not. now the govt has made hallmarking mandatory for all gold jewellary.

  176. Hi,

    I have just come across LIC Policy “Jeevan Saral” which irrespective of Age as a factor would give you handsome return

    Eg: A monthly investment of 2000 rs for a period of 30 years will give you an sum of Rs. 45.13 lacs at the end of 30 years thats like return of 13% CAGR.

    The policy is for a maximum period of 35years when returns turns out to be 13.18% CAGR…..

    Also you get insurance of 5lacs for lifetime which is add-on…..

    Is this for real?????? and if yes how is it possible to get such high return on sustainable basis for such long time….will LIC usrvive this????

  177. We are a Green Energy Company located in Bangalore, we were interested to have distributors for our products in Biogas and one International company that we market in India, Energy Saving Device with a patented technology. Our existing clients are Major software companies, Hotels, Restaurants, Schools, Malls, Fast food joints, Retail outlets, petrol pumps etc.

    Companies with good knowledge in Energy Business having dedicated team to back the product would be associated with. Areas open for marketing is East, Central and North India.

    Kindly send company profile at aslam@azgreenenergy.in

  178. Hi manshu…iv read that when there is over-subcription in the retail category…there is proportional allotment…could you explain with an example how it actually works…

  179. Hello,

    1. As these days scams and frauds are increasing as population I would suggest you to inform the readers about good sites which actually pay.

    2. And also Please do give info. about how to select a particular company to invest in?

    3. Whats the process? Where to get registered to buy shares? each and every info.

    4. Can you tell me how to earn revenues by owning a website? Whats the process? And so on.

  180. how it cause of inflation if goverment print money to purchase things from other counteries then why a country face shortage of money

  181. I received a call from someone from Motilal Oswal telling me that they have launched a new product called ‘Nifty positional trading system with Hedging’ which is an automated trading system which has given over 25% returns in last 4 months and works like PMS investing in futures and options only. I have no knowledge about derivatives. can you pls review this product, how does it work and is it safe to invest in it. I was told the minimum investment in nifty future is 60000 (30k margin & 30k mtm) and the charges would be the normal brokerage.
    surprisingly Motilal oswal’s website has no details about this product.

  182. in nps can a corporate choose both type of fund manager at a time,i.e govt line lic,sbi,uti and the fund manager of all citizenship

  183. Dear Manshu,

    I read your blog before taking any financial decision and i thank you a lot as your blog has really educated me regarding the various financial products. Thanks a lot for your untiring work . However, of late, i have been thinking and worked out a way / plan for the financial benefits which are likely to be received against my policies , god forbid, if something happens to me during the tenure of these policies. I want some one/ some trusted agency/ to handle any benefits received from my policies and benefits given by my employer/ in a particular manner . Are there any such agencies? if not, what steps should i take to ensure that the funds received are deployed gainfully in fd’s/ MF’s etc, as my wife is a housewife and is not very knowledgable about financial products and she may have to take care of my 2 kids and my old mother.

  184. Your postings are very interesting, informative and practical. Can you please post an article on “How a retail investor can buy bonds, especially tax free bonds in secondary market in India?”

    Thanks and Best Regards,
    Shivtaj

  185. Hi,

    I just came across Religare iTerm Plan. They have rename it to Religare (Medical) iTerm plan, where the maximum policy term is 57 years (Means if an individual has taken the policy at the age of 18, it will cover him till 75 years.) or till one gets 75 year old.

    Looks good to me.
    Is it worth buying.

    Thanks
    Sandeep

    1. Sandeep,
      I have taken this Religare iterm plan this year(before they revised). This looks good to me. The procedure was simple and all well managed.
      (Religare’s low prices carried me away 🙂 )However after i took this plan,came to know that AVIVA offers this still cheap!
      My openion – Religare is good and cheap ( Ignore the low claim approval record people talk about as long as you declare your details correctly).How ever consider Aviva too……

      Manshu – Why dont u pay me for my tips 🙂 hahaha joking!

      1. I am a bit concerned about the new plan as it has the maximum coverage time. Usually other term plan providers cover you for 30-35 years. But in the Religare term plan, the maximum coverage time is till you acquire 75 years. Consider a person who 30 as of now and he plans to take this policy, so he will be covered for 45 years. That sounds too good to be true.

  186. Dear Sir,
    I have an account with IDBI Bank. My account number is 2085404000010680 comprising
    16 digits .Proof of account and cancelled copy of the cheque is given to my DP who has promptly made the changes in bank Mandate and confirmed. The DP has all the details like MICR/ECS Code etc
    In the RBI ECS forms 15 digit account number are entered.Now ECS credits donot get credited to my accounts from dividends on shares,interest on bonds etc.Bank says contact DP,
    DP says contact the company.Mail sent to IDBI Banks customer care says we will revert back to you.What do I do? ( account no is changed for security)

  187. Hi,
    I am regular reader of your posting.
    I am looking for piece of information : –
    Help to know, If I take tax saving fixed deposite in the name of my wife, will I get tax exemption on the amount.

    Regards
    Niraj Kumar
    New Delhi

  188. Hello
    This is Rajesh Mishra from Delhi. Would anyone let me understand all about share market from orientation to till now and how company get listed on stock exchange all thing suppose you are going to tell a fresher..
    I keen to know that …

    1. You are asking a degree course on your computer. It is a vast subject, either you will learn it as student and study or by experience of long term of many years.

  189. Financial Planning for Newly Married Couples.
    Have seen articles on this topic, but nothing that quite helps me in a guided fashion.

    1. First save money wherever possible. To start with put your money in FDs of Nationalized bank. About 20% in a good mutual fund(Make reasearch). 10% purchase 24K gold (not jewels) and keep it in a bank locker. Look out for some one time premium of LIC policies.
      AND learn by saving.

  190. 1) Why arent index funds doing good in india. And why is it they are not given much attention by the investment sites and even fund houses.The expense ratio is around 1 [ greater than 1 sometimes ] and tracking error is also large.I feel the investment help sites have a bias towards actively managed funds

    2)Equity diversification beyond indian market – No good fund yet.

    1. Santhosh – I am pretty sure you are comparing this vis-a-vis the developed markets – especially – the US where Index funds have low expenses and minimal tracking error and where they are a rage.

      Indian economy can be compared to that of the state of the US economy in the late 1950s where rapid infrastructure developments lead to massive economic growth. We have decades of economic (and stock market) growth in the making. Chances are actively managed funds will outperform the index for the next 1-2 decades. When we become a matured economy then the alpha on the actively managed funds will fall considerably and we will all be debating on the best index funds really!

      It is true Equity diversification beyond Indian market is not available. There are few index ETFs like DJIA, Hangseng etc traded in NSE but just that. Some funds like HSBC Brazil exist but again this in turn does not do any specific stock picking – they buy international funds in their portfolio thereby increasing costs for the investor!

  191. dear sir
    I am TECHIE & i am preparing myself to start INVESTING in stocks. google revealed your post & i really admire your work.It will be more helpful if there is a post describing investing for novices like me.

    Regards,
    KK

    1. Krishna – Even a novice can understand a book like “One up on the Wall Sreet” by Peter Lynch. Grab a copy – it makes light reading for a week -and you should be done. Do you want to come back and then discuss more?

      1. thanks for d great advice, right now i m into his other book “learn to earn”
        I will definetly come back with basics strong

    2. Please jump into stock market. Your money in the stocks must be contained to 20% of your investment. That’s it and that’s it only.

    3. Please dont jump into stock market. Your money in the stocks must be contained to 20% of your investment. That’s it and that’s it only.

  192. Dear Sir,
    Your are really doing a Fine job, explaining stocks & shares to novices like me. It will be much helpful if you can give a beginners introduction to investing in STOCKS.

    1. Gold backed money is HISTORY. This will not happen. Death awaits for those leader who dare to implement it. Please search google for Gaddaffi’s plan on this and his death.

  193. A detailed analysis on the non life insurance sector would be helpful. If possible you can make it into 2 detailed topics one the infamous health insurance and the other insurance other non-life insurance like properties, etc.

    Things that impact the cost analysis decision on these could be pretty handy to prepare and decide.

    Regards.

  194. There are lot of persons nowadays who are thinking about early retirement or are burnt out by 50/55 yrs but are not clear on how much money is required for the retirement years.So wud like to have comments on this newage requirement.

  195. Recently I changed the bank Mandate with my DP from ICICI Bank to IDBI Bank.
    ICICI Bank Uses 12 Digit account number IDBI Bank uses 16 digit account Number.
    RBI uses 15 digit number for NECS credit of of dividends, Interest on bonds etc.
    since last three months all the ECS remittance has been rejected.The DP says contact Bank,
    Bank tells contact DP/Registrar and so on .RBI should have made it mandatory for every bank to use 15 digit account number to suit ECS credit.I used to get ecs credits to ICICI Bank promptly
    Kindly help me in getting credit. How to find out which company has declared dividend

  196. Hi,
    Could you do a post on ‘Stop Loss orders’ with few examples? Why there are not ‘Book profit orders’ then? Aren’t those useful to?

    Thanks,

  197. Most of the topics discussed here are very useful and overflow with hard research’ and still very lucid to read. I would like to request you to add another topic related to following subject.
    Transferring money from abroad to India is easy but sending money abroad is little complicated. Coould you write a topic, keeping in mind various avenues available, their nusances, efficiency and comparative cost. Also what is the exact cost of transfer of a US Dollers to INR and again transfer back to US Dollors in an NRE Account. keeping the Dollor
    rupee exchange rate constant. Apart from the commission and service charge, do the banks also dupe us by using higher/lower exchange rates than actual exchange rates.

  198. I know that Interest from NSC/ Bank FDs/Savings accounts are taxable. I’ve a doubt here. If I invest the interest income from the above mentioned accounts in Share market/tax saving instruments, then also will it (i.e. Interest income) be taxable ??

    Thanking you in advance.

  199. I have been reading your posts in depth and as a professional the biggest problem I face is asking the right questions to my financial planer. I take my portfolio to him he asks some questions and makes some suggestions. A year down the lane…. same story. It would be of great help if you could tell what to ask a planer and how to asses his advice.
    I think this should help lot of us.
    Thanks

  200. Manshu,
    Can you provide some highlights about the upcoming budget which are expected and how they would affect an individual ?

    Thanks,
    Ams

  201. As am poor in the economics part, wanted to know few things about currency valuations…..many of my relatives are working in middle east (OMAN, UAE) because of the higher currency valuations….every where theres a buzz that india is shining and we recently overtaken Japan in terms of economic power..but if its so why is our currency lower compared to the middle east…

    I would be really privileged , if you could please explain this to me or else if at all if you had published any article on the same …can I get the link for the same pls?

    Thanks in advance….

  202. Hi ,
    Your blog has a wonderful way which is good to go for layman and experts on subjects and shares views in one of most unbiased way i have seen so far.Gr8 job keep going.
    Wanted to know what
    a) Should one go for SIP in Gold MF or lum sum
    b) What makes Gold ETF’s /MF better investments than buying real gold coin in hands

  203. Pl. let me know the following aspects of CGA (capitals gain a/c):
    I have sold a self owned only house recently. I plan using the capital gains to buy a flat for my use. The flat is being built by a reputed builder and will be ready in 3 years time. I am given to understand that I have to open a CGA, capital gain a/c with a public sector bank.
    1. Are there any problems in its operation for paying a flat builder at regular interval.
    2. I am given to understand that interest accrued every year is taxed and has to be paid from other resources of the holder of the CGA. If so this seems to be a draconian measure as the holder may not have adequate other income.
    3. It is understandable that the capitals gain is paid on the surplus left over (capital gain-cost of property acquired ), however the interest accrued has already been taxed, does one have to pay capital gain tax on this as well? If so I shall understand why one should be dishonest.
    Shall be grateful for clarification.

  204. One topic of interest could be the difference between BSE and NSE. It appears that we can buy shares from one and sell in the other so consequently arbitrage can happen. But how do companies and the exchanges manage the fact that shares outstanding in one exchange might be traded in another? I presume NSE and BSE must have an inter-exchange settlement facility? Is this unique to only these two exchanges or do we have examples of this elsewhere?

  205. I think it is fairly clear how, why and when FMPs are better than Bank Fixed Deposits. Can we please have an article on how to go about choosing the right fund house or scheme?

    1. I don’t think there is much science when it comes to choosing FMPs, I’ll try to research this topic and see if there is something I can come up with.

  206. Hi,

    There is no article written on creating HUF to save tax. May be you could cover, what is HUF (A simple reference http://www.charteredclub.com/how-to-save-taxes-by-forming-huf/) and very importantly, how to create a HUF which is not clearly explained in many blogs and articles.

    May be this is the right time as people will be looking for some alternate ways to save few bugs on tax.

    I am planing to start the process soon, and will update you with details I have.

    Cheers
    Velu

    1. I’m not familiar with this process Velu so I’m not sure how to go about writing an article on this. I think till I do this myself or find someone who has done this I will have to wait to write this post. If you’re undergoing this process and want to give some inputs then you’re welcome. Thanks!

  207. Hi,
    I am a regular reader of all the posts on One Mint and thanks to all concern for such a nice knowledgeable information.

    I am on the verge of switching my job from an Indian Company to a Foreign Company based in India (its a work from home job). I will get my salary paid in USD. I was told by my friends that I can open NRE account in bank to get the salary in USD and can avoid income tax (Indian) since I will get my salary in USD. Also only on the interest pat I need to pay the income tax. Please suggest whether this idea of NRE account is true or is there any catch?

    Thanking you.

    Deepak Jain

  208. My topic is AEGON Religare Term Insurance plan which offer 1 cr insurance on premium of Rs.6400 pa. If somebody is aware about pros and cons of the same or of term insurance. Any comparision of term insurance productrs available in the market. Pls suggest.

  209. Start topic about forex it will satisfy my hunger about currency. Currency has became an tool for
    investing and hedging against inflation. Currency details required so please start it as soon as possible.
    Thanks and regards
    vijaya singh

  210. Hi

    I have a basic or silly doubt. Please bear with me.

    I have been holding L & T shares for the last 7 years and I bought these shares for various reasons. One of the reason is I would get shares from subsidiary companies of L & T if it get listed in stock exchanges. But when L & T Finance Holdings came for IPO , I didn’t apply for the IPO and being L & T shareholder I thought that I would few shares of L & T Finance but it was not so. Suppose, if L & T Infotech gets listed in future, whether I would get any shares of L & T Infotech for being the shareholder of parent company L & T .

    Kindly explain me in detail why I didn’t get shares of L & T Finance Holdings ? Is it because of IPO of L & T Finance Holdings ? If anyboy say or believe with valid reasons that I should have got L & T Finance Holdings shares automatically being shareholder of L & T , then can I approach L & T Finance Holdings now ? If it had not come for IPO, whether I would have got shares of L & T Finance Holdings ? In future, whether I would get shares of L & T Infotech ?

    Thanks in Advance.

    Regards

  211. Can u please clarify the concepts of YTM and relation between YTM (with calculationa) and Bond Prices with examples. Also the relationship between YTM ,interest rates and Bond prices. Some examples would be very useful

  212. Can u please explain the method of calculating “Earning per Share” (EPS) taking into account the Growth & PE.

    Can we project “Forward earning” by (Present Sensex / Present Price Earnings)* “Expected Times Growth”

    Does Sensex “Dividend Yield” and “Price to Book Value” play any role in projecting forward “Earning” figure?

    1. I’m not sure I understand this properly. It appears that you know what EPS is and how it’s calculated but are interested in some sort of a Sensex estimation / prediction methodology that’s based on PE?

      I don’t know if I’m interpreting it correctly, can you share a link if there is one that prompted this question.

  213. I have recently (within last 6 months) started reading your blog regularly and I really appreciate the efforts you take to educate your readers and the discussions that take place through comments.

    I am interested in knowing more about target date funds and your analysis/opinion on investing into such funds from a long term perspective. What are the pros and cons of investing in these MFs and can you recommend any good picks for retirement target of 20 years from now?

    Thanks!

  214. Hi Manshu!
    I have been following your post from past 2-3 months and I liked it very much. I am interested in stock market, therefore, gathering knowledge on it. I want to know more about crude oil and its impact on market and economy of a country. Every time I tune into CNBC or while going through some business newspaper I came across this “CRUDE OIL or BRENT CRUDE” but I could not figure out its impact.
    I would be grateful to if you could help me out.

  215. Manshu:
    I am looking at possibilities to contribute to OneMint. I am an accomplished CA with extensive experience in reputable organizations. I can share more about me if required by you.

    1. Thanks for your interest, but this is my personal blog and right now I’m not looking for contributions, perhaps you’ll be more suited contributing to a newspaper. Thanks!

  216. pls suggest me……
    If buy ETF gold so transaction charges are Applicable are not ,
    If yes. so how much during buying and selling.
    Thx….

  217. I have been following your post for the last 5 Months, it is very very usefull, your way of presentation on any topic is very very nice,even a lay man will understand it, thank you very much .
    ” BIS Hall marking of Gold Jewellery ” – Is it Correct that the purity (.916, .875 etc ) mentioned on the BIS Hallmarked gold ornament, is just the surface purity of the ornament and not of the entire ornament, i also understand that hall marking is done on a sample from a lot and not on 100 % ornaments. it would be nice if you could write post on ” Hall marking of Gold Jewellaery”
    Thanks
    JMMohandas

  218. A lot of topics have been covered regarding Insurance and Investments for Indian national residing in India.I am yet to hear a topic about the NRIs purchasing foreign Insurance and Investment products.I would say that 100 % of the expatriates especially in the Middle East are being taken for a ride in these avenues .Consultants acting on behalf of large brokerages are earning commissions in the range of 100%-140% of the first year premiums being paid by the policy holders.
    They are wrongly selling Insurance products to customers in the name of Investments and Mutual funds…Really feel sorry for all the expats fallen in this trap..

  219. Sir,
    I want to buy term plan. suggest me from which compny i should take. The premium of LIC are larger than any other companies like ICICI, HDFC, Kotak…

    1. I’m not really familiar with this other than knowing it’s for government employees only (and I’m not even sure of that) so I don’t think I can write about it – sorry.

  220. Hi

    Today I read a news about Home Loan.
    Customers who have taken home loans from HDFC under the dual rate scheme are facing a peculiar problem. From April’1 , once their rates shift from Fixed to floating , their floating rate will be higher than the current floating rates, due to higher spreads.

    Currently, HDFC’s floating rates vary between 10.5 to 11 per cent, depending on the amount. For customers whose loans become floating from April’1 , the rates could be in the 11. -12 per cent range, due to higher spreads over the RPLR ( Retail Prime Lending Rate ).

    Here, my question is what is higher spreads and why conversion floating rate will be higher than the current floating rates, due to higher spreads ?

    Please explain.

    Thanks in advance.

    1. Frankly, I’m not familiar with this situation and this is the first time I’m hearing of it but let me look at this and see what’s going on here. Thanks for the suggestion.

  221. Investment decisions in debentures or bonds…..
    Selection on what basis…and other decisions…and
    Muthoots idea of NCDs doubling your money in five and half year….

    1. I don’t think I have a lot to say on this apart from spreading your money around and not getting exposed to any single company. I’ll see if I can write more than that on this.

  222. I am retired. Want to be benefited by trading during steady trends. Pl give the technical analysis sites & blogs. Suggestions for efficient usage of them may please be given !!!

    1. I would say it is better for you to stay away from technical analysis as a lot more people lose money in that than make money, and when the market falls sharply like it did last year or 2008 then it is very hard to find cover or cut losses. Generally, the losses run very deep and market changes direction very quickly. I don’t think there is such a thing as a steady trend, and my thought on this would be to stay away from the market completely.

  223. How to become an long term equity investor? I mean to say do I need to pursue any courses for that. As I am a BCOM graduate I don’t face any problem reading financial statements but other stock market and economy factors are alien to me. Please help.

    1. No, there are no courses for this kind of thing – you just need to read up on this kind of thought process. There are a lot of good books about this, you could read the ones written by Peter Lynch to start off.

  224. Being an immature investor, I do understand most of how stock markets works, however, I have trouble trying to comprehend how a share price is calculated at any given time. Lot of people have provided me with different theories but clearly no one had a good understanding. The most common and simple answer I got was “based on demand and supply” – DuH – what an intelligent answer! Also my Google searches didn’t lead me to any satisfactory explanation.

    I want to know that given the what the demand and supply is, how exactly, at a micro-level, is a share price (displayed at the exchange) calculated? What formulae are used? Are they too mathematical to be understood by a lay person? Who calculates, validates it – computers, humans? Who is responsible for it?

    1. It’s a great question, and I’m surprised you haven’t found a clear answer to it yet. The process is all automated and is based on the bids and asks sent to the exchange and their automated matching program. I’ll see if I can write this up in a lot more detail of course but it is simple enough for anyone to understand.

      You might find the pre open session post on this interesting as well.

      http://www.onemint.com/2010/11/29/what-is-the-significance-of-pre-open-session-of-the-stock-exchanges-we-see-from-9-am-to-9-15-am-daily/

    2. No formula is used to calculate the price of a share, because in secondary market price is not calculated. The price of a share is decided by the market, by we people, by the purchaser and the seller. It is a game of demand and supply.

      The past and present performance and even the future prospects of a company is the main force behind its demand. And when a share is in demand its price is likely to go upwards. And when a company is not performing well there will be slump in the demand and the price is likely to go downwards.

      Performance is not the only factor that decide the price/market trend. Many other factors like economical, financial, political, judicial or social factors/situations/news also have a say in deciding the price or overall market trend.

        1. I think, he being an immature investor should not dig that deep to know the process etc but if he just want to have data and statistics of bid and ask orders with volume or any other data then there are many websites/blogs like nse/bse sites that can help him

  225. Hi Manshu,

    I need to know step by step procedure to start Shares or Mutual funds. We all know what is MF, shares, or Bonds. But how to begin to be part of it. All I know is savings account, so what next. What do i do for other accounts? Where to begin?

    Thank you. You are doing a great job.

    1. So, you mean how to buy shares or mutual funds or bonds? That? That’s actually a very wide topic, and I’m not sure how to handle that in just one single post. What I would suggest is that you start following the series I’m writing right now on how beginners can approach investing in the stock market.

      This is the link and this will be a good place to start in my opinion.

      http://www.onemint.com/2012/03/14/how-beginners-should-approach-investing-in-the-stock-market/

      1. Hi Manshu,

        Many sites says definitions but not how to be practical. Your posts talks more practical. I am benefited from your posts.

        Yes, I do follow your posts. I am waiting for your new posts.

  226. When does the inflation data get released every month. Is there any fixed date (i-e 15th of evry month).
    Also want to know when would rbi review it s policy , i-e whether monthly , quarterly ??? and on which date the same is released ?
    Need clarity on above since i’m planning some investments ahead of this every month

    1. That’s a great suggestion – I wasn’t aware of this till now but would like to explore this and write about it – thanks for bringing it up.

  227. Dear sir,
    FOLIO NOs : 406116791314/ 406116791325/406116791336

    I purchased NFO ‘Reliance Small Cap Fund’ open ended OFF LINE in Aug/Sep 2011. Three
    applications were made in my name (single holder with three different nominees) – each for 1000 units. Preference for Demat was given in the application to my ICICI Direct Demat
    —deleted—
    Co ordinated action by all agencies can only provide solution to this vexatious LIMBO situation.
    Dear sir , I seek your help in getting SOAs so that I can thro’ Transfer Instruction get the units a DEMAT, Linked to my Trading A/C.
    Thanking you
    P.Parameswar

    1. I feel your pain, but this is way beyond what I do here or can do for you. Unfortunately, I can’t suggest you a better way to do this either. Also, I’m deleting the part of your comment which has Demat numbers etc. because that shouldn’t be shared like this in public. All the best.

  228. Dear Sir,
    I have Insurance Policy ‘Dream Life’ with Bharti-Axalife Insurance Co. My Policy No is

    –deleted–

    Beyond saying that the co will act on the request at earliest no action was taken so far –
    your liaison in this regard is solicited.
    Parasuram Parameswar

  229. Dear Sir,
    Please discuss Tax Implications for FIIs and confusion vis-a-vis GAAR

    Thanks and Regards

    Vinod Kulkarni

  230. dear sir,

    now banks hav started charging more than 100% for lockers in banks
    one of this is JANKALYAN CO-OP BANK LTD

    general public does not even knows about this rate hikes and why a sudden and drastic increase in rates of lockers

    allready v r having many committements and in this banks manager is saying V HAV NOT

    CHARGED YOU FROM LAST 10 YEARS

    what a stupid answer….

  231. Difference between returns of fixed deposit and a mutual fund. kindly calculate and let us know the annulised return (how it is calculated in case of mutual fund) both on fixed deposit and mutual fund considering the interest of fixed deposit at 9.25 % and three mutual fund (one medium performing fund, one high performing fund and one bad performing fund). Kindly calculate and let us know the return supposing one time investment of Rs. 10,000/- only.
    If possible kindly calculate and let us know the comparison of returns of Rs. 5,000/- SIP in mututal fund each month for five years and Rs. 5,000/- monthly subscription in RD account giving 9.25 % interest for five years.
    With regards.
    Om

    1. I suggest you do not compare FD with MF investments for the following reasons:
      1. FDs are safe and protected by banks. These are treated as risk free. Further the category of banks such as SBI improves your risk situation as it is backed by the Government of India
      2. Though MF offers schemes with capital protection but these are not risk free. In fact you need to monitor these almost daily to see their NAV performance. MFs performance over the last two years has been dismal with or without SIP.
      3. Each MF scheme has to be evaluated for its past and present performance in relation to the market conditions. Upon evaluation one needs to take under consideration the economic scenario that is likely to unfold in the months/years to come to extrpolate the growth or de-growth in NAV for computing the likely return one can earn.
      4. Monitoring market on a daily basis requires time, effort and diligence. Those who are not active investors are well advised to move towards safety and protection of capital.
      If you require any specific situational analysis please let me know.

      SSK

  232. Hi Manju,

    First of all let me thank you for writing such informative n useful articles time and again.

    I want to know more about recently released Government bonds. How to buy them,comparison with FD at 9.5%interest rate.

    I have 3 lac rupees with me and i want ur opinion on the best instrument to invest in for monthly income for next 5-10 years. IDBI FD is currently running in my mind at 9.5% interst rate but after TDS the effective return will be 8.5215(kindly correct me if i m wrong).

    1. There are some tax free bonds that have listed at a discount and you can look at buying those too along with the fixed deposits. If you are at the 30% tax slab then these are a good option too.

  233. How the mutual funds handle the dividends that they receive from the stocks they own in the portifolio.

    For example: HDFC top 200 (G) has 8.53% of the funds Invested in SBI. In 2011 SBI has given 300% of dividend. Since the fund is earning tax free income from the company, what they will be doing with the dividend income?

    1. As far as I know there is no limitation on how they use the cash, they are free to reinvest in SBI, buy another stock, keep it for redemption or pay out as dividends. But if your question is whether this dividend income ultimately comes to the unit holders then yes, it absolutely does come to the unit holders one way or another.

  234. Any interest earned in NRE account is not taxable in India , but is taxable in USA

    Where as any interest earned in NRO accounti s taxable in India, hence not taxed again in USA.

    1. Now lets say if someone invested their NRO account funds in fixed maturity plans indexed to inflation rate, and did nt have to pay any tax since inflation rate turns out to be more than the interest rate on FMP. Now in this kind of a scenario is the interest income coming from an FMP account, is it taxable in USA ?

    2. If someone moves their Indian money i.e. money origination from India into NRO account, and earns interest, should that income be shown in USA ?

    3. In an NRO account one can move their Indian money as well as transfer money from USA into the same NRO acccount. What are the tax implication on such account in INDIA AND USA ?

    1. What you should do is Google up how companies manage working capital, capex, and expansion that will help you get material for your project work.

      1. i have gone thru it..good one…
        I have some queries

        Who controls CDS?
        This mechanism originated in which country?

        The banks also insure the loan then how it is different from CDS?

        Plz explain ….

        1. I think these were invented in the US and for a lot of these instruments they are transacted between two parties over the counter so don’t have the kind of regulation that a share will have. They are instruments that can be bought and sold by anyone and not necessarily the people who actually take out the loan (which is the case for bank insurance) and that’s one marked difference, and second is that the market is a lot bigger.

          Also, please use the post itself to ask questions so that others who land on their page can benefit from your questions as well.

  235. Hi Sir,

    I am Rajeshwari from Bangalore I am receiving your mails its very useful and good also. Actually I want to ask one suggestion or the correct path i.e., I am married I want to save gold for my daughter for her future requirements. First I will tell my plan: that is I want purchase the gold from now onwards one or two grams monthly or two months once. If I purchase like this, is there any wealth Tax on gold coin purchasing? please tell me and is this the way is correct for gold saving?

    Any other way is there for Gold saving? please suggest me, I don’t want to take risk also I want to save my money and Gold safely? I don’t want to get loss. So, please suggest me a correct path or way.

    regards,
    Rajeshwari E

    1. You have not mentioned the time horizon of your requirement of gold but purchasing gold in small quantities is a good idea.

      You can purchase/invest in gold in small quantities thro Gold ETF and eGold, as small as 1/2 in Gold ETF and 1 gram in eGold. For more details on eGold you can visit National Spot Exchange (NSEL) website http://www.nationalspotexchange.com

      Manshu has written many post on Gold ETF and you can search in http://www.onemint.com/category/etf/

      Manshu also wrote a post on eGold last January, you can go thro it.
      http://www.onemint.com/2011/01/13/e-gold-and-e-silver-from-nsel/
      I also posted a comment in this post on 13.10.11 about various option available for investment in gold.

      Purchasing gold ETF and eGold is very much similar to purchasing shares. Please note that you have to pay some inherent cost and charges on all investment or gold purchase like brokerage and other govt. charges and various taxes, demat charges and VAT if converted to physical gold etc. etc.

      Now a days there are many gold jewellery saving schemes by various established jewellers. You can go thro an article that appeared in MINT newspaper recently http://www.livemint.com/2012/04/12220457/Are-gold-jewellery-saving-sche.html
      And you can have your own opinion about these schemes, whether they are worth or not.

  236. Financial goals and planning: Do I really need it ?

    Sounds absurd but read through my post…. This is my first post in a blog as I found Onemint a really practical and unbiased discussion forum. Please keep up the good work of spreading financial knowledge.

    Before I start this post, I want to say this – I have a full time software job but I do have average understanding of different mutual funds, SIP, Equity, Debts, power of compounding, effect of inflation, tax efficient investing and “start saving early” concepts. I also do realize that we are in probably most uncertain period of time with very insecure jobs, global effect on economy and constant change of macro and micro economy. How do I ensure a better future for me and my family in such scenario ? Simple and easy answer – Start saving as much as you can through different asset class after carefully studying their risks/your priorities/diversification. I am already doing it.

    Now, two points I want to bring here –
    1. Why to set goals when I know that I am doing my best to save what I can. Whenever there is a need I simply will take out money. Only thing I have to take care is before say 2 years of my NEED, I will re-assess and re-align my portfolio to minimize risks and ensure liquidity. This way I will not loose my sleep thinking about say “I need 20 lakh money in 2017”. If I have the money at that time, I will achieve my goal. If not, I will have to forgo that need or borrow. Setting goals does not mean anything unless I have a new product or solution other than what I already know.
    2. Do I really need to go to a financial planner ? With my current knowledge as described above, what is the other option a financial planner can give me ? Only for setting goals (like marriage, retirement planning, education, home etc.) – setting goal does not help me in any way when I am already investing in the best way I can through different asset class and tax efficient way ? Most financial planner just set goals and reiterate what we already know and then finally ends up selling products and never follows up? (That happended with a few of my friends.)

    I want to conclude here by saying
    1. Don’t get into hypertension/diabetes in your mid life by thinking too much on goals.
    2. At the same time you have to be aware of basics of economy (You don’t have to be expert as that part can be left to paid fund manager for example) so that you can save in an efficient way and as much as you can. The mantra is “START SAVING EARLY AND REGULARLY IN ASSET CLASS YOU ARE COMFORTABLE IN”.
    3. Maintain a lifestyle balancing between comfort and luxury so that you can be sure that you are not wasting any money. Know what you absolutely need and what you don’t need. Ultimately “A penny saved is a penny which can be invested.”
    4. If you have internet, you can find financial information very easily. Financial education is not one time learning. You have to update yourself with major economic changes or new products and probably learn from your mistakes too. If you think a financial planner can give you all information in a 6 or 7 hour session without you having to invest time to learn yourself later, you are wrong. If you have come here in Onemint, and reading this post – I know that you already know basics of finance, you want to know more and you have the financial AWARENESS. So, happy investing.

    1. Thanks for sharing your thoughts, and I appreciate your rationale and thoughts behind this. I think the foundation of good financial life lies in savings, and everything else depends on it, if you aren’t saving enough you can’t do anything with your money because you will always be busy paying credit card bills and worrying about the next EMI.

    1. Hi Arun

      Perhaps I can. Can you please answer the following basic questions.

      1. What type of software you want.
      2. What sort of help you want using the software.
      3. What is your knowledge about stock market.
      4. Do you have any knowledge about technical analysis, charting tools etc.
      5. Lastly, are you a new or an active trader in market. If active, since how long.

      If you like, do add few words about you too (age, education etc,). I may add there is nothing like this, that a software will tell you to invest in a particular stock(s), it is only you who have to decide.

      1. Dear Umesh,

        i am an engineer , 24 yrs, just started my career in UAE .
        am a student in stock market for last 3-4 months.
        One Gentle men told me he is using a software to invest.
        Though i felt its tough to penetrate into the finance field, i thought He may using certain software which works/predicts the stocks, by following any laws/theories .

        I just know Elliot wave theory and the definition about support and resistance, dont know to calculate.
        I just know the major division of listed companies but donno any major theories or prominent factors considered before buy/sell a stock, But Eager to know all…

        For study I just started the virtual trade in Rediff money…
        Then felt a lot need to understand which i dont know, and when heard of software helps in Investing, decided to seek the help of you guys .

        1. Hi Arun

          I don’t know what type of software, your friend is using. You may simply ask him and I hope he will oblige you.

          In my opinion he might be using some charting software (CS) (.exe type), may be Amibroker (AB), MetaStock (MS), Ninja Trader (NJ), Advanced Get (AG) etc. etc. With the help of these CSs, one can do charting of stocks and can also analyse/scan data on RT (real time) and EOD (End of Day) basis. And on this basis one can watch/select stocks for investment/trade. These softwares are quite costly, ranging about 10,000 onwards. Beside this cost one has to pay for data also. As appetite of these software is quite much and they require their feed every second/minute and they will not yield anything new until you satiate their hunger. Just joking but true. But you have to subscribe for paid data and it will cost you something 500-1000 per month. These softwares are also available “for trial basis” and you should first go for a trial.

          There are web based charting software also (Jawa type), normally embedded in charting websites and these are free to use. These charts are EOD and not RT and rarely you will find RT charts free of cost.

          There are two types of analysis/studies. One is fundamental studies and other is technical studies. The fundamental study(ies) is done for the fundamentals of a stock and the company. How the company is performing and its profit and loss etc. etc. and many other things. Beside this any good or bad news (relevant to market) and financial position of ones country and the world also had role in the movement of stocks.

          Technical study(ies) is done on the movement of stock(s). It is basically the study of technical indicators. There are many Technical Indicators (TIs) and one should do some study of them. Examples of some mportant TIs are Relative Strength Index (RSI), Stochastics, Bollinger Bands, Moving Average Convergence Divergence (MACD), Simple Moving Average (SMA), Exponential Moving Average (EMA). You will come across more of these TIs, once you start studying these indicators. One should also study chart patterns and candlesticks patterns.

          For a basic and advanced study of technical analysis go through stockcharts, investopedia, moneycontrol etc etc. Moneycontrol is good for fundamental studies as well. Also go through websites of BSE and NSE. You need not go into advcanced study but should have more than basic knowledge.

          Beside this there is Elliott wave (EW) theory, Gann theory etc. You said you have some knowledge of EW. Also get the knowledge of Pivot Point and Support and Resistance. Calculation of support/resistance is very easy and you can do it yourself or with the help of pivot point calculator.

          You being an educated person, must be knowing that a software is a dead object and you have to feed your knowledge and skill in to it so as to get something out of it. Many time just clicking few button(s) is not sufficient.

          Gaining knowledge is a slow and steady process. Just do not jump on to study everything. In the start everything will go over your head but slowly and slowly you will understand what you want. Read some books on technical analysis and method of trading. Joining some forums and blogs and reading comments etc for gaining knowledge will be a good idea.

          One word of caution, investing/trading in stock market is very risky and only a few earns from this, mostly there are losers. Another word, one will also come across many person/consultant/websites about sureshot tips/advices to earn money, one should take the right decision oneself. In the last I wish to add that whatever I have mentioned above is only for educational purpose and I am not connected directly or indirectly with any website and/or software company.

          1. Dear Umesh,

            you gave me strong idea of basics and show me a path how to move further.
            i will conc on TI’s and theories by making use of mentioned websites as its the basics rather than other stuffs.
            Felt happy when i used a Pivot point calculator as its so simple than expected.
            Thanks for guiding me to the right path.

  237. I give one example here for long term capital gain (LTCG) calculation –
    Let’s say, I booked an under construction apartment in Dec, 2006 by paying Rs. 1 lakh. I got the sale agreement a week later which laid down terms of payment as the costruction progresses. I kept paying cash year after year as per the agreement
    Nov, 2007 – Rs. 4 lakh
    Nov, 2008 – Rs. 3 lakh
    Nov, 2009 – Rs. 2 lakh
    Since the construction was taking longer than he promised and I was not satisfied with his quality of construction, I had asked for cancellation of my booking and refund of my entire money paid to him and compensate me for that. I made the request in Nov, 2010 and he finally paid 12 lakh in Nov, 2011. Now, let us say I want to calculate capital gain with indexation benefit (assuming it is LTCG).

    Questions are –
    Is it really a capital gain for me ? 🙂 If yes, is it short term or long term ?
    What is the buy date and sell date for this complicated transaction considering the fact that the property was never registered to my name?
    LTCG rule says the property has to be sold after 3 years from buy date ? Is it the case with me ?
    Since the payment was made in different FY, can I use different indexation for all the corresponding years ?
    Could the calcluation be different had I taken a loan ?

    Can you please write a post on these type of practical and possible transactions ?

    1. To the best of my knowledge , I have replied.

      1. There is NO capital gain in this transaction as there is no transfer of capital asset. Somebody may argue that relinquishment of rights in a property also to be treated as transfer of capital asset. But I differ from them as the property is yet to be completed .

      2. You need not worry about buy date and sell date because as I said there is NO capital gain involved and you yourself said property is yet to registered.

      3. Even if you had taken home loan there is NO capital gain involved. Only Loss for you is whatever interest paid on pre-completion period has to be foregone without claiming any tax benefit because property is not completed and you have surrenderd the under construction property back to the promoter.

      4. Difference of Rs.2 lacs can be treated as Compensation by promoter for not completing the p roperty as per agreed terms and this Rs.2 lacs can be treated as Income from other sources and tax has to be calculated on the total income including this Rs.2 lacs.

      If anybody differ my views, Please clarify with proper explanation.

      1. I was under impression that it is a captial gain. 🙂
        Your reply is wonderful and logical. It makes sense. Thanks.

    2. I’m afraid I can’t write a post on this and explain this because I’m not knowledgeable enough about tax to write about such intricate deals. Sorry.

  238. Hi,
    what is RBIs Repo rate? and what is the real effect on common man by today’s (17/4/2012) RBIs Repo rate cut by 50BPS?

  239. Hi

    I have a basic or silly doubt. Please bear with me.

    I have been holding L & T shares for the last 7 years and I bought these shares for various reasons. One of the reason is I would get shares from subsidiary companies of L & T if it get listed in stock exchanges. But when L & T Finance Holdings came for IPO , I didn’t apply for the IPO and being L & T shareholder I thought that I would few shares of L & T Finance but it was not so. Suppose, if L & T Infotech gets listed in future, whether I would get