Mind Of Confused Investor:

January 26, 2012 | Author: admin

Hi,I am investor,but confused.I have heard somewhere that there is clearity behind confusion,but it’s  not looking true for me.What has made me confused and irrational?

Sometimes back I picked up few shares suggested by the expert on the television.after few days same expert suggested indifferent stocks,than suggested earlier.Now I am CONFUSED what to do with earlier stocks and what is the guarantee that he will not turn to another scripts in future?

Somedays back,I invested in mutual funds suggested on one of the advisors website.Now,he is in favor of totally different schemes..now I am CONFUSED what to do with my existing schemes.Is it so much easy to reshuffle,exit and enter the different schemes?What will I do if he once again turn to new post with new schemes?

When market goes up everyone talks of growth option etc and when market corrects significantly everyone advocates dividend mode or systematic withdrawl plans,isn’t it confusing?I have heard and read that equities are for longer term,but I get confused when some one writes about importance of profit booking….

I was entered in unit Linked Insurance Plan few years back.I am highly confused whether to continue or not?One mind says you should continue as I have paid most of the charges already.My agent and insurance company have already earned maximum out of it. It will be beneficial investing ahead,, while one mind says  ’exit’ as most of the investors are showing it door and as well I should also follow the crowd.I am confused which of my side will prove true?

Same thing is about my ongoing endowment and moneyback plan also.Exit or continue?If today I exit it and in future if someone prove  that how endowment plans are good then what will happen with me?I can’t go to insurance company again to restore it as it is irreversible after specific period.

What is future of real estate and Gold?utter confusion…I have to buy both.Home is a basic need while I need to accumulate Gold for children’s marriage in future…What will happen to me if prices continuously go on?

Really,there are a huge question marks in front of me..then why not to let money remain in saving account till I come out of the confusion and why not to take decision whenever i will find answers to my question?,,at least I will remain happy looking at my bank balance,isn’t it?

Posted in Uncategorized | Leave a Comment

IRFC Tax Free Bonds:

January 23, 2012 | Author: admin

The financing arm of Indian railways “Indian Railway Finance Corporation Ltd” has come up with a issue of Tax free bonds with following details.It is infrastructure finance company and 100% shareholding held by Govt Of India.

IRFC Issue Details:

  • Issue Open date: 27th Jan 2012.
  • Issue Close Date:10th Feb 2012.
  • Secured NCDs having tax benefits u/s 10(15)(iv)(h).
  • Issue size: Rs.3000 Cr. with option to retain oversubscription upto shelf limit i.e. upto 6300 crores.
  • Credit rating:”AAA” from ICRA, CARE and CRISIL,indicates stable and highest safety.

Interest Rates:

Options 1 2
Tenure 10 Yrs 15 Yrs
Face value Rs.1000/- Rs.1000/-
Min.Application 10Bonds OR

[Rs.10,000]

 10 Bonds   OR

Rs.10,000/-
In multiples of 5 Bonds[Rs.5000] 5 Bonds[Rs.5000]
                              Interest Rates
Retail [Cateogary-III] 8.15% 8.30%
Others[I and II] 8.00% 8.10%
Interest Payment Annually Annually
  •  Interest payment date will be 15th Oct each year.
  • Interest received from these bonds will be free from income tax and of course no TDS for whats ever amount.
  • Wealth tax is not levied on investments in these bonds.
  • Just,do not confuse it with 80-ccf issues and 80-ccf benefit is not available with these bonds.

Who Can Apply:

  1. Cateogary I: QIB and Corporates.
  2. Cateogary II: Resident individuals,HUFs through Karta,NRIs above Rs. 5 lakh.
  3. Cateogary III:Resident individuals,HUFs through Karta,NRIs below Rs. 5 lakh.

Invest Or Not?

Such kind of issues apart from tax free interests,offer great diversification within debt portfolio,so one can  definitely think to invest some part of the money in such issues.Partial liquidity is available through annual interest payment and can be reinvested in proper instrument to improve overall yield.

 

Posted in Fixed deposits | Leave a Comment

Investing Psychology And Behavior:

January 21, 2012 | Author: admin

Its really tough to write about psycology and behaviour but any saving and investment related blog is incomplete without post of  behaviour of traders and investors.

There is one ancient tale.God decide to test psycology of human being  [I think he may want to test that whether source code installed within human being is properly working or not!!]  and gifted one couple with a hen that lay a golden egg every day in the morning.Couple used to sell the golden egg everyday and started getting handsome money..Within few days they become impatient and started spending sleepless nights,,waiting  the golden egg.One day they become such impatient that they decided to cut the hen and to take all the golden eggs at once.Having done so,they found that this hen was not different from other hens and they loose their asset as well future gains they were assured day by day.

This story of ‘The Goose That Laid Golden Egg’ is true representation of what traders do in F&O or Commodity market.Rather opportunistic  trading, we want gains for each and every movement.Number of traders loose the capital and as well possible future gains also.

Whenever I judge my own trading behavior,I found that after successive winning trades, I show overconfident,careless and irresponsible behavior and vice versa over-concious and very careful after loosing some money,,which ruins genuine market opportunities.

A number of papers have presented about this issue.Most of them argue that investors are generally irrational and source of this irrationalities is Greed,fear and other emotional attributes.Most of them conclude that there is a link between decision making and other parameters like breathing rate,heart rate,skin conductance and body temperature.Different emotional or moody conditions like happy,relaxed,angry,stressed,upset,guilty,enthuastic,nervous,gittery,afraid,
tired,sluggish,sleepy,anxitic and any other conditions affect trading decisions.

There are number of coaching classes teaches technical or fundamental analysis but I think that rather than technical analyst,, personality with patience and inner calm can become more successful trader and investor.Also,mere financial plan to achieve the goals may not be sufficient,one need to adopt the required psychology to implement it properly,isn’t it?

Posted in Commodities, Uncategorized | Leave a Comment