Understanding Structured Products

We have always known that for investments, risk and return go hand in hand. It’s a principle that potential return rises with an increase in risk. According to the risk-return tradeoff, invested money can render higher profits only if it is subject to the possibility of being lost. Therefore, whenever we invest in equities, (with a heavy heart) we are ready to face loss of capital also. How about an option where, “saap bhi mar jaaye aur laathi bhi na tute!” I mean an option where you have the chance of gaining upside potential and also get protection of capital. Difficult to believe! Isn’t it? Financial innovation has made it possible. With the advent of structured products such a thing can happen.

Jeevan Ankur: Is it a seed worth sowing?

              Dreaming for your children’s future is perhaps one of the most important things that you do even before your child is born. Chances are that it might take some time before you know what your kid is good at, but you can always provide for his/her future by choosing a children’s plan that will give you the funds at the right time to take his/her dreams forward.

LIC has launched Jeevan Ankur, an endowment plan, especially designed to meet the educational and other needs of the child. The plan ensures that your responsibilities are met whether you survive or not without the need for your family to depend on others. The risk cover under this plan will be of the parent and child shall be the beneficiary.

Will For Healthcare Treatment

            We live in an age of planning where we plan everything from what to eat for lunch to where to go on the weekend or the next big vacation. Basically, we try to live life to the fullest. But, have we ever thought of the difficulty that end of life decisions can create. Huge problems occur within the family when no one has ever discussed what they would want done or how they would want to be treated in the event of a life threatening illness or injury. About a year back, (published on 15^th Jan, 2011) I had written an article, “mrityu pachi priyajanone vadhu vhaala thava planning karo”. That article was about how to plan in advance the proceedings about things that might occur after death (like estate distribution via a will, Organ Donation, Making Peace etc.). This article is about how to plan for things and make hard decisions that may be required to be taken during near to death situations when one would be facing life threatening illness.

At the time of recession saving is as good as earning

 Thoughts of a young mother giving a Financial Planning perspective

            Whenever we talk about financial planning we talk about maximizing returns. We all seem to be running a rat race for making more money than others. But what about our expenses? One basic principle of Finance that all of us have learned in our childhood is “Money Saved is also Money Earned.”  Do you give this principle its due thought in your day to day life? Are you watchful of all your expenditures? Or are you one of those who easily get swayed by the spending habits of other people around you. Are you one of those who would give missed calls to friends expecting them to call you back in order to cut on wasteful expenses? Or do you fall in the typical ‘shop till you drop’ category of compulsive shoppers who just need excuses like boredom, stress or sales to spend. Compulsive shopping or spending can be a seasonal balm for the depression, anxiety and loneliness, but it will not assure more love, bolster self-esteem, or heal the hurts, regrets, stress, and the problems of daily living. It generally makes these feelings worse because of the increased financial burden the person has obtained from compulsive shopping.

Change the Gears as per the Road and Destination!

             Investing can be correlated to driving a car. While starting the car, more often than not, we have a destination in mind where we wish to reach. Same is for investing, we do invest   (rather henceforth we should) keeping a goal in mind. So that we have an idea, how far are we from the goal and at what speed we are comfortable to proceed.

Also, the driver needs to be in control of the speed, if he doesn’t know how fast he is supposed to be going and is not in control of his car, and then if the unexpected happens, a minor mistake can turn into something a whole lot more tragic. The same can be said of investing. When you have not done some calculation of how diversified your portfolio is or how much risk is in your portfolio, you are not in control of your portfolio, and when the unexpected happens, like the 2008 market crash, you may even lead to losses that you can never recover from.

To be Financially Free, Get Out of The “Chakravyuh”

Learn it the best, by playing “Chanakya’s Chakkravyuh” game!

I personally believe that spreading knowledge that you have acquired is the best gift you can give to the society. Through my articles, I have constantly attempted to give you something new & valuable to make you comfortable in the complex world of investments. Apart from writing articles, I also conduct “investor education seminars”. Last month, I came across one more interesting way of making my dear investors understand how to handle their investments in a better way i.e. by playing a board game named, “Chanakya’s Chakkravyuh.” I found it; by far the most effective way to impart financial literacy, because, learning with playing unlocks one’s thinking pattern and potential.

 

Funda of Fundamental Investing

Funds that follow an active investment approach, like the diversified equity funds, are in a constant search of strategies to generate superior returns or alpha against their respective benchmark indices. The fund manager takes active participation in discovering stocks which can create value for investors in the long run. Over the years, the natural inefficiencies in the Indian markets have helped these funds, with active investment strategies, to fare better than the index. There is enough evidence to show that equity diversified funds have delivered higher returns for investors who have the risk appetite and a long investment time horizon.

But what if the past performance does not sustain in future?

New Year Resolutions….!

“There are some people, who live in a dream world, and there are some who face reality; and then there are those who turn one into the other.”

 - Douglas H. Everett

            As a child, I had always dreamt of having a lavish office, being a leader and running my own business. Not knowing then, at all how I would get there, but the will within was strong. Today, I am actually living my dream. Though the journey till here has not been a cake walk as it seemed in the childhood dream, but the pride and satisfaction of living it is immense.

“All that we are, is a result of what we have thought” – Buddha. So, what I do is, even today I have my own dream world. In my dream world I VISUALIZE & Rehearse my future. But I wonder how many of you’ll have realized the power of dreaming? Or turning it into reality?

Make Your Daughter’s Life Grand, Why Only Her Wedding….!!!

 

Daughter – The closest to a father’s heart. The relationship between a father & his little girl is very unique & special. All through the growing years father takes special care that his daughter gets the best of what she wants. While doing this he doesn’t even realize when his little princess turns to be young enough to be married to her prince charming.

But having a daughter get married can be a little traumatic. After all some young man is taking your place as the most important male in your daughter’s life. The emotional trauma is in expressible.

On the other hand if we see the financial impact, it is something which a father thinks about since the birth of his daughter. As a father he starts accumulating little by little for the D-day. It is every father’s dream to make his daughter’s wedding into a GRAND CELEBRATION.

Mind mapping: Revolution in the age of Intelligence

Dawn of the Intelligence era!!!

In my last article, I shared the concept of mind mapping, a medium through which one can plan or sort things in a convenient yet extraordinary manner. Gone are the days when only possessing intelligence or a degree could get you success. Now, we are living in the age of information, we are provided with ample of data and information, the main crux lies in how proficiently one utilizes his intelligence to process that information.

The concept of mind map is quite an old concept but Tony Buzan is the philanthropist who has introduced this concept in a more convincing (packaged) way. It enables us to improve our way of working and performing tasks whether is it in the role of a student, teacher, employee, business person or so on. We are in the age full of information, only important thing is who and how fast somebody utilizes the information creatively.