Archive for May 3, 2009

Investing amid conflicting signals

Publication: Business Standard, Mumbai; Dated: 31 May 2009

Rely on your instincts and don’t worry about others.

The sudden sharp U-turn of equity markets in the past 10-odd days have given a lot of investors the feeling that they have been left out along with the Left. At the same time, the scars of the past are haunting people who consider re-entering the market now. The Sensex levels of 7,000 and 8,000 have been deeply etched in every equity investor’s mind and those who want to invest are sitting on the sidelines just to enter at lower levels. Yet, even perennial bears and global hedge fund managers are now saying there might not be much downside from the current levels of 14,000.

At the same time, gold has been flat for almost a couple of months and has been slightly inching upwards. Real estate is showing no signs of revival, but builders believe things will suddenly improve because of the change of guard at the Centre. Interest rates, not just on loans but also on fixed deposits, have gone down. While all this is happening, oil has gone up to $65 from a low of $34 just a few months earlier. Higher oil prices could result in higher inflation in the future, which could mean interest rates firming up. Recently though, some banks announced that interest rates would be cut by around 1.5% in the near future. Hence, there are many conflicting signals and the key question is what one must do now.

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Courage with caution

Publication: Business standard; section: Money matters; Date: May 24, 2009

Emotions should not drive your investment strategy and there’s a way of ensuring this doesn’t happen.

The upper circuits of Golden Monday took every possible participant in the Indian equity markets by surprise. Though there was not much of buying on the day, Tuesday witnessed record volumes in the equity markets. Later, though the volumes have been high, profit-booking has been witnessed in large-cap stocks, whereas mid-cap and small-cap stocks, which did not participate in the Golden Monday rally, have been rallying since Wednesday.

Suddenly , the most pessimistic of foreign institutional investors (FIIs) and professional Indian and global bears have turned bullish, and are talking of a paradigm shift in the equity market landscape. Expectedly, a lot of high networth individuals (HNIs) and retail investors who were not keen participants at market levels of 8,000 are feeling left out. People who thought they would enter at 6,000 levels are looking to enter now. One hedge fund manager claimed, “We were 40 per cent long on India and now we will be 60 per cent long.” Another fund manager boasted of India attracting huge foreign inflows.

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Passing on values with wealth

Publication : Business standard, Mumbai; Date: May 17 2009;

Create inheritance goals for your children.

A lot of affluent parents and grandparents are worried about the fate of their family wealth when inherited by their children. The care of money has many enemies — there is greed, taxes, inflation and foolishness and, above all, the traits and sense of the individual who has or inherits money.

Ajay Mathur, a business owner in his 60s, wanted to make sure there is something left for his grandchildren. He felt his family money was exposed to some risks. Risk of mismanagement. Risk of destructive habits. Risk of loss through divorce and marriage. He strongly believed the wealth for which he had worked so hard should not disappear because of any of these problems.

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Planning for the future

Publication: Busines Standard, Mumbai;   Date: May 3, 2009;    Section: Marketing & Investing;

Estate Planning is the process of transferring all your assets (collectively referred to as estate) to your beneficiaries according to your wishes. This can also include the medical care.

Let’s understand some basic terms of Estate Planning

The sum of all the assets of a person, less his liabilities becomes his estate. In short, all properties, bank accounts, investments, insurances and collectibles, less the liabilities of a person, are collectively called a person’s estate.

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