A very important aspect of the investor’s psychology is the concept of risk aversion. That is the desire to avoid or minimize risk in investments. Not all individuals will be prepared to take the same degree of overall risk of all their investments put together. All investors do not carry the same degree of risk… Continue reading Explained: The Concept of Risk Aversion
Finance and Economics Education for the Life Insurance Sales and Marketing Persons Knowledge is Power Learn Concepts that Are Today’s Market Language This is the third article of the Explained Series of Articles from me. In this series I will be explaining a few concepts in financial theory and how they are linked to selling… Continue reading Hair Cut by Banks May Result in Baldness of the Mutual Fund Investor
This article is a case study of how the degree of risk in an investment can suddenly change. An investment that is considered safe can almost overnight become a dead investment and investors lose in the resulting volatility of price fluctuations. The financial sector knows how to hide truth Whatever else one may say of… Continue reading Explained: Side Pocketing – An Example of How Investment Risk Actually Works in Practice
The Fact – Indians prefer low risk investments Savings data compiled by Central Statistical Office (CSO), Government of India, and published by the Reserve Bank of India in its Handbook of Statistics, shows that without exception since the time they started publishing the data from 1970 till date (48 years, now), Indians have always put… Continue reading This is a FACT not an Opinion
The newspaper Mint reported on 4 December 2018 (MFs extend loans to listed entities against shares in promoter firms by Jayashree Uphadhyay and Gopika Gopakumar) that some of the mutual funds have extended loans directly to companies. Some of mutual funds that have been mentioned in the article are: Franklin India Ultra Short Bond, Reliance… Continue reading Are mutual funds banks?
One of the most repeated lines in the media is that traditional life insurance endowment is low return and that if one wants life insurance it is better to buy term insurance and with the balance of money (saved by not buying traditional insurance) buy mutual funds. This is one of the most unscientific statements… Continue reading Term Insurance and Mutual Fund Combo
We have been pointing out on this Blog (See: Where Indians Save) as well as in our training programs see our website www.iistpune.in that Indians are low risk investors (not low returns mind you). Given a chance Indians would prefer to invest and save in such a manner that their capital is protected. This is… Continue reading The Case of Negative Cash Holdings
So you thought that there is a bull run on the stock market and therefore buying equity mutual funds will fetch you high returns. Think again. But first let us quantify the equity bull-run in the past one year. One year ago, on 3 August 2017, the SENSEX closed at 32237 and on 3 August… Continue reading Bull Run or Bear: It is never safe to invest in mutual funds
Recently there was an article in the newspaper titled Mixing Life Insurance with Investment is a Common Mistake. It was published in a column titled “OOPS! Mistakes Investors Make” in Business Standard 2 August 2018. the article written by Kayezad Adajana explains the view point of Maher Dhamodiwala, who we are told is the founder… Continue reading No Fraud Here
Like in in the famous fable where the Tortoise wins the race against the fancied rabbit, in investments too the much maligned low risk investments may be better under conditions of market volatility, as compared to high risk investments. Slowly but surely the low risk investments can outperform the high risk investments, beat the inflation… Continue reading And the Tortoise Wins!
