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!
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§id=2&contentid=20090916200909160200270091a0a1dd
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.
Here is the post on that topic:
http://www.onemint.com/2011/11/04/too-good-to-be-true-offers/
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. 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.
Hi Manshu,
Why did the Indian Govt give freedom to the oil companies to decide their price?
Regards
Arun Satish
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.
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.
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.
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?
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?
3. If all your mutual fund services are free, how do you make money? What is your revenue?
In the case of mutual funds, our source of revenue would be the so-called ‘trail fees’. This is not something that we charge our investors explicitly. These are paid out of the annual fund management fees that every mutual fund already charges.
https://www.fundsindia.com/content/jsp/corporate/faq.do
Also, please check the following link… How do we link this news article in the current scenario?
http://www.indiainfoline.com/Markets/News/Various-Fund-Houses-announces-the-Deduction-of-Transaction-Charge-from-Subscription-Amount-for-Purchase-through-Agents/3996483645
Hmm this was a long time coming – entry load of 1.5% or less as I can see it – add that to the other cost.
Thank you Vishal – let me look at this some more and understand these charges more thoroughly.
check out this one as well…
http://economictimes.indiatimes.com/markets/regulation/sebi-asks-fund-houses-to-display-agent-fees-on-websites/articleshow/10588713.cms
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.
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
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.
Here is the post on that topic:
http://www.onemint.com/2011/11/09/how-is-the-sensex-calculated/
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.
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.
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…
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.
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 🙂
Great – this is someone else’s idea – I can’t remember where I read this first, but I have heard it from a few different people.
Here is the post on that:
http://www.onemint.com/2011/11/07/lic-whole-life-limited-payment-policy-review/
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.
Thanks Dweep – I have absolutely on knowledge or interest in trading, so I won’t be able to write on it. Sorry.
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?
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.
I suggest you create a seperate topic exclusively related all issues connected with SENIOR CITIZENS.
I’m not sure I understand what you mean? A category?
What is mutual funds n what is difference between mutual funds and shares
Good idea Akshay – I’ll write about it and include ETF, fund of funds also so that the post becomes a little more comprehensive.
Here is the post that explains the difference between mutual funds and shares.
http://www.onemint.com/2011/11/08/difference-between-shares-and-mutual-funds/
What are mutual funds n what is difference between mutual funds n shares
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.
Great Idea! Will line up that post for the future.
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.
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.
Single premium policies e.g: LIC BIMA BACHAT. How about a post on that Manshu?
Yes, coming up for sure – already started on ICICI Pru’s iAssure policy review as someone had suggested that earlier. Will do this one shortly too.
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.
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.
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.
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?
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.
I just wanted to chime in and say it makes total sense to me.
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..
That’s a great suggestion Atul – I’ll try to write about that in future.
Hi Atul,
Sorry just clarification what’s HFT?
That’s high frequency trading – basically algorithm based trading that computers conduct – transacting in milliseconds.
Here is the post on that
http://www.onemint.com/2011/10/31/algorithmic-and-high-frequency-trading-in-india/
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
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.
thanks manshu…
now i can go through all of your article from start easily and increase my knowledge base….
thanks a lot
ujjwal
Superb idea from you Ujjwal – I should thank you for it – thanks a lot!!! 🙂