To Minimise The Risk of Fraud
1) Utilize paperless options. Restrict receipt of paper statements by subscribing to e-mailed bank account statements, credit card statements and demat account statements.
2)Monitor your account activity regularly by checking your balances and statements online through BAnk's website. This helps you to detect fraudulent transactions, if any, quickly. The earlier a fraud is detected, the lesser will be its financial impact.
3) Restrict the use of cheques. Transfer funds online
4)Receive and pay bills online for free with Bill Payment option at webiste. Fewer the personal documents sent through the mail, lesser the chance of fraud.
5)Register for mobile banking and receive alerts upon all significant transactions in your account. Learn more about Mobile Banking.
6)Communicate with the bank through the secure mailbox option at webiste, “Write to Account Manager”.
Tips For Use When Banking Through The Internet
1)Avoid accessing your Internet Banking account from a cyber cafe or a shared computer.
However, if you happen to do so change your passwords from your own computer.
2)Every time you complete your online banking session, log off . Do not just close your browser.
3)To access Bank's Internet Banking, always type in the correct URL into your browser window. Never click a link that offers to take you to our website.
4)If your log-in IDs or passwords appear automatically on the sign-in page of a secure website, you should disable the “Auto Complete” function to increase the security of your information.To disable the “Auto Complete” function
5) Open Internet Explorer and click "Tools" > "Internet Options" > "Content".
Under "Personal Information", click "Auto Complete”.
Uncheck "User names and passwords on forms" and click "Clear Passwords".
Click "OK".
6)Change your Internet Banking passwords (both log-in password and transaction password) after your first log-in, and thereafter regularly (at least once in a month).
7)Your password should be complex and difficult for others to guess. Use letters, numbers and special characters [such as !,@, #,$, %, ^, &,* (, )] in your passwords.
8)For additional security to financial transactions through Internet Banking, create and maintain different passwords for log-in and for transactions.
9)If you have more than one Internet Banking user ID, use a different password for each of the user IDs. You may also view all your accounts with Bank under a single user ID by linking your various accounts to your preferred Internet Banking user ID.
10)Never share your Internet Banking passwords with others, even family members. Do not reveal them to anybody, not even to an Bank employee.
11)Always check the last log-in to your Internet Banking account.
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"VISITORS ARE ADVISED TO ALSO CHECK OUT THE CO-RELATED ADS DISPLAYED BELOW TO HAVE ADDITIONAL KNOWLEDGE ON THE SUBJECT. YOUR SINCERE EFFORT WOULD HELP US TO SERVE YOU BETTER".
CREDIT CARD BASIC KNOWLEDGE
What should I do if my card is lost or damaged?
Contact your Bank help centre immediately via phone banking .They will block your lost/damaged card instantly and a new card will be delivered to you within seven days.
Can I retain my credit card if I emigrate?
Credit cards (including global cards) are issued to resident Indians only. Therefore, under RBI guidelines, you have to clear your outstanding and surrender your credit card to the issuing bank if you are proceeding abroad on employment or on emigration
Can I use my credit card for expenses on the Internet?
Yes, your credit card can be used for expenses on the Internet. However, the Reserve Bank of India prohibits its use for certain expenses on its banned list like football pools, sweepstakes and lotteries.
What do I do if my credit card is declined?
Contact your Bank help centre immediately via phone banking
How do I protect my credit card against fraud or theft?
Do not forget the following :
1) Sign your card as soon as you receive it!
2)When you use your card at an ATM, enter your PIN in such a way that no one can memorize your keystrokes.
3)Don't leave your receipt behind at the ATM. Your PIN and account number from a discarded receipt could make you vulnerable to credit-card fraud. Also, don't throw out your credit-card statement, receipts or carbons without first shredding them!
4)Never give your credit-card number over the telephone unless you initiated the call.
5)Even when you place the call to a legitimate merchant, never give out your card number over a cordless phone. One common scam is when someone calls you "back" right after you place an order, claims to be from the merchant and tells you that there was a problem with your card number, so would you mind giving it to them again? The safest thing to do is to ask them to read out the number they have, and then change any incorrect numbers.
6)Ignore any credit-card offer that requires you to spend money upfront or fails to disclose the identity of the card issuer.
7)Make certain you get your card back after you make a purchase (one good habit to observe is to leave your wallet open in your hand until you have the card back). Also, make sure that you personally rip up any voided or cancelled charge slips.
8)Always keep a list of your credit cards, credit-card numbers and toll-free numbers handy, in case your card is stolen or lost.
9)Check your monthly statement to make certain all charges are your own, and notify the card issuer of any errors or unauthorized charges immediately.
What if I cross my credit limit?
If you make a transaction that exceeds your available credit limit, Bank will use its discretion and decide whether or not to approve the transaction. If the transaction is approved, an over-limit charge would be levied to the card account. The over-limit charge(Varying from bank to bank) will be charged of the amount by which the credit limit is exceeded (subject to a minimum charge ).
What is a temporary credit-limit enhancement?
There will be times when you feel the need for an increase in your credit limit to enable you to make increased purchases on your card.
What is a self-set limit?
You can pre-set the monthly spending limit on your supplementary/add-on credit card. Any transactions over the specified 'Spend Limit' will be declined.
What is the revolving credit facility?
When you receive your bill, you have the flexibility of selecting any of the following payment options:
Pay the total amount due.
Pay only the minimum amount due.
Pay any amount ranging from the minimum amount due to the total amount due.
Should you opt for either of the last two options, then the unpaid amount due is carried forward to the next billing period. This is referred to as the revolving credit facility
When do I start paying interest on new purchases if I am already revolving credit?
If you are revolving credit, fresh purchases attract interest from their respective dates of purchase.
What is the balance transfer facility?
Worried about the outstandings on your other-banks’ credit cards? Are the interest rates bothering you all the time?this is a special offer just for you, which would surely help you get rid of your worries on interest charges. The Bank balance transfer facility allows you to transfer your outstandings from your other-banks’ credit cards to your Bank Credit Card at interest rates as low as 0%. Various attractive schemes like the ‘0% Balance Transfer offer’ and the ‘Life Time Balance Transfer offer’, along with zero documentation and crisp draft delivery make the Bank Credit Card balance Transfer programme the best in the market.
Will fresh purchases also attract interest if I use the balance transfer facility?
Your fresh purchases get the normal credit period for the first month. However, if at the end of the first billing cycle, your total amount due (including balance transfer) is not reduced to zero, your fresh purchases attract interest from the respective dates of purchase.
Are there any interest charges?
If you make a payment for the Total Amount Due before the Payment Due Date, no interest charges are applicable. Thus you can enjoy interest-free credit from the date of purchase to the date on which the payment is due. This can be as high as 50 days for Silver Card members and 52 days for Gold/Titanium/Platinum/Signature Card members!
If you send a payment for the "Minimum Amount Due" or pay any amount less than the "Total Amount Due", interest charges are applied on the outstanding amount and on any fresh charges that you incur subsequently. However, for certain transactions like cash withdrawals, interest charges would be applicable from the date of transaction till date of payment.
If there are some unpaid "Minimum Amounts Due" of previous statements, then these will also be added on to the "Minimum Amount Due" of your current statement.
If you have for some reason exceeded your credit limit, then the amount by which you have exceeded the credit limit will also be added to the "Minimum Amount Due".
When will the interest charge stop?
If all outstanding charges are paid at any time, the interest charges will cease to apply immediately.
How are interest rates calculated on an Bank Credit Card?
Interest charges are applicable only if the cardholder chooses the part payment facility (revolver facility). It is governed by a rate of interest. The interest accrual is on the daily outstanding balance. The monthly application of interest happens on the statement date.
An example of calculation of interest, where the customer has made all retail transactions and no cash withdrawals:
As the customer has made a part payment, interest is charged on transactions of the previous month from the respective transaction date up to the statement date; then on the TAD (total amount due) from the statement date up to the part payment date; and then on the balance amount (after deducting part payment made from TAD) from the part payment date up to the next statement date.
Finally, if there are any fresh purchases interest is charged on them from the respective transaction date up to the statement date.
If the customer makes a part payment he does not enjoy interest-free days on fresh purchases.
How do I pay my credit-card bill?
1)Drop your payment cheques in the 'drop box' facility at any Bank branches and ATM centres.
2)Cash payments are accepted at Bank branches during banking hours.
3)auto-debit facility.
4)Bank account holders can also avail of the convenience of scheduling payments through Bank Internet Banking or pay their credit-card bills through customer care centre.
5)If you are not an Bank account holder, you can still pay from your existing bank account via the Internet.
What is the auto-debit facility?
Auto-debit allows Bank account holders to give standing instructions to pay their credit card bills (either minimum amount or total amount due) directly through their bank account. Simply give a written instruction to Bank, or inform Bank’s customer care centre to debit the payment directly to your account every month.
What happens if my cheque gets delayed in the post beyond the payment due date?
If your payment is not received by the Payment Due Date, a late fee is applicable and the outstanding amount attracts interest for the number of days by which the payment has been delayed.
What happens if I pay more than the total amount due?
TThe excess amount shows up in your monthly statement and is adjusted against future purchases.
What happens in the case of a disputed card transaction?
In the case of a disputed card transaction, Bank will get back to you at the earliest with the status of your transaction.
Contact your Bank help centre immediately via phone banking .They will block your lost/damaged card instantly and a new card will be delivered to you within seven days.
Can I retain my credit card if I emigrate?
Credit cards (including global cards) are issued to resident Indians only. Therefore, under RBI guidelines, you have to clear your outstanding and surrender your credit card to the issuing bank if you are proceeding abroad on employment or on emigration
Can I use my credit card for expenses on the Internet?
Yes, your credit card can be used for expenses on the Internet. However, the Reserve Bank of India prohibits its use for certain expenses on its banned list like football pools, sweepstakes and lotteries.
What do I do if my credit card is declined?
Contact your Bank help centre immediately via phone banking
How do I protect my credit card against fraud or theft?
Do not forget the following :
1) Sign your card as soon as you receive it!
2)When you use your card at an ATM, enter your PIN in such a way that no one can memorize your keystrokes.
3)Don't leave your receipt behind at the ATM. Your PIN and account number from a discarded receipt could make you vulnerable to credit-card fraud. Also, don't throw out your credit-card statement, receipts or carbons without first shredding them!
4)Never give your credit-card number over the telephone unless you initiated the call.
5)Even when you place the call to a legitimate merchant, never give out your card number over a cordless phone. One common scam is when someone calls you "back" right after you place an order, claims to be from the merchant and tells you that there was a problem with your card number, so would you mind giving it to them again? The safest thing to do is to ask them to read out the number they have, and then change any incorrect numbers.
6)Ignore any credit-card offer that requires you to spend money upfront or fails to disclose the identity of the card issuer.
7)Make certain you get your card back after you make a purchase (one good habit to observe is to leave your wallet open in your hand until you have the card back). Also, make sure that you personally rip up any voided or cancelled charge slips.
8)Always keep a list of your credit cards, credit-card numbers and toll-free numbers handy, in case your card is stolen or lost.
9)Check your monthly statement to make certain all charges are your own, and notify the card issuer of any errors or unauthorized charges immediately.
What if I cross my credit limit?
If you make a transaction that exceeds your available credit limit, Bank will use its discretion and decide whether or not to approve the transaction. If the transaction is approved, an over-limit charge would be levied to the card account. The over-limit charge(Varying from bank to bank) will be charged of the amount by which the credit limit is exceeded (subject to a minimum charge ).
What is a temporary credit-limit enhancement?
There will be times when you feel the need for an increase in your credit limit to enable you to make increased purchases on your card.
What is a self-set limit?
You can pre-set the monthly spending limit on your supplementary/add-on credit card. Any transactions over the specified 'Spend Limit' will be declined.
What is the revolving credit facility?
When you receive your bill, you have the flexibility of selecting any of the following payment options:
Pay the total amount due.
Pay only the minimum amount due.
Pay any amount ranging from the minimum amount due to the total amount due.
Should you opt for either of the last two options, then the unpaid amount due is carried forward to the next billing period. This is referred to as the revolving credit facility
When do I start paying interest on new purchases if I am already revolving credit?
If you are revolving credit, fresh purchases attract interest from their respective dates of purchase.
What is the balance transfer facility?
Worried about the outstandings on your other-banks’ credit cards? Are the interest rates bothering you all the time?this is a special offer just for you, which would surely help you get rid of your worries on interest charges. The Bank balance transfer facility allows you to transfer your outstandings from your other-banks’ credit cards to your Bank Credit Card at interest rates as low as 0%. Various attractive schemes like the ‘0% Balance Transfer offer’ and the ‘Life Time Balance Transfer offer’, along with zero documentation and crisp draft delivery make the Bank Credit Card balance Transfer programme the best in the market.
Will fresh purchases also attract interest if I use the balance transfer facility?
Your fresh purchases get the normal credit period for the first month. However, if at the end of the first billing cycle, your total amount due (including balance transfer) is not reduced to zero, your fresh purchases attract interest from the respective dates of purchase.
Are there any interest charges?
If you make a payment for the Total Amount Due before the Payment Due Date, no interest charges are applicable. Thus you can enjoy interest-free credit from the date of purchase to the date on which the payment is due. This can be as high as 50 days for Silver Card members and 52 days for Gold/Titanium/Platinum/Signature Card members!
If you send a payment for the "Minimum Amount Due" or pay any amount less than the "Total Amount Due", interest charges are applied on the outstanding amount and on any fresh charges that you incur subsequently. However, for certain transactions like cash withdrawals, interest charges would be applicable from the date of transaction till date of payment.
If there are some unpaid "Minimum Amounts Due" of previous statements, then these will also be added on to the "Minimum Amount Due" of your current statement.
If you have for some reason exceeded your credit limit, then the amount by which you have exceeded the credit limit will also be added to the "Minimum Amount Due".
When will the interest charge stop?
If all outstanding charges are paid at any time, the interest charges will cease to apply immediately.
How are interest rates calculated on an Bank Credit Card?
Interest charges are applicable only if the cardholder chooses the part payment facility (revolver facility). It is governed by a rate of interest. The interest accrual is on the daily outstanding balance. The monthly application of interest happens on the statement date.
An example of calculation of interest, where the customer has made all retail transactions and no cash withdrawals:
As the customer has made a part payment, interest is charged on transactions of the previous month from the respective transaction date up to the statement date; then on the TAD (total amount due) from the statement date up to the part payment date; and then on the balance amount (after deducting part payment made from TAD) from the part payment date up to the next statement date.
Finally, if there are any fresh purchases interest is charged on them from the respective transaction date up to the statement date.
If the customer makes a part payment he does not enjoy interest-free days on fresh purchases.
How do I pay my credit-card bill?
1)Drop your payment cheques in the 'drop box' facility at any Bank branches and ATM centres.
2)Cash payments are accepted at Bank branches during banking hours.
3)auto-debit facility.
4)Bank account holders can also avail of the convenience of scheduling payments through Bank Internet Banking or pay their credit-card bills through customer care centre.
5)If you are not an Bank account holder, you can still pay from your existing bank account via the Internet.
What is the auto-debit facility?
Auto-debit allows Bank account holders to give standing instructions to pay their credit card bills (either minimum amount or total amount due) directly through their bank account. Simply give a written instruction to Bank, or inform Bank’s customer care centre to debit the payment directly to your account every month.
What happens if my cheque gets delayed in the post beyond the payment due date?
If your payment is not received by the Payment Due Date, a late fee is applicable and the outstanding amount attracts interest for the number of days by which the payment has been delayed.
What happens if I pay more than the total amount due?
TThe excess amount shows up in your monthly statement and is adjusted against future purchases.
What happens in the case of a disputed card transaction?
In the case of a disputed card transaction, Bank will get back to you at the earliest with the status of your transaction.
KEYPOINTS OF PPF ACCOUNT
1) The Public Provident Fund Scheme is a statutory scheme of the CentralGovernment of India.
2) The Scheme is for 15 years.
3) The rate of interest is 8% compounded annually.
4) The minimum deposit is 500/- and maximum is Rs. 70,000/- in a financial year.
5) One deposit with a minimum amount of Rs.500/- is mandatory in each financial year.
6) The deposit can be in lumpsum or in convenient installments, not more than 12 Installments in a year or two installments in a month subject to total deposit of Rs.70,000/-.
7) It is not necessary to make a deposit in every month of the year. The amount of deposit can be varied to suit the convenience of the account holders.
8) The account in which deposits are not made for any reasons is treated as discontinued account and such account can not be closed before maturity.
9) The discontinued account can be activated by payment of minimum deposit of Rs.500/- with default fee of Rs.50/- for each defaulted year.
10) Account can be opened by an individual or a minor through the guardian.
Joint account is not permissible.
11) Those who are contributing to GPF Fund or EDF account can also open a PPF account.
A Power of attorney holder can neither open or operate a PPF account.
12) The grand father/mother cannot open a PPF behalf of their minorgrand son/daughter.
The deposits shall be in multiple of Rs.5/- subject to minimum amount of Rs.500/-.
13) The deposit in a minor account is clubbed with the deposit of the account of the Guardian for the limit of Rs.70,000/-.
14) No age is prescribed for opening a PPF account.
15) Interest is not contractual but rate is notified by Ministry of Finance, Govt. of India, at the end of each year.
16) The facility of first withdrawal in the 7th year of the account subject to a limit of 50% of the amount at credit preceding three year balance. Thereafter one Withdrawal in every year is permissible.
17) Pre-mature closure of a PPF Account is not permissible except in case of death.
Nominee/legal heir of PPF Account holder on death of the account holder can not continue the account, but account had to be closed.
18) The account holder has an option to extend the PPF account for any period in a block of 5 years on each time.
19) The account holder can retain the account after maturity for any period without making any further deposits. The balance in the account will continue to earn interest at normal rate as admissible on PPF account till the account is closed.
20) One withdrawal in each financial year is also admissible in such account.
21) The PPF scheme is operated through Post Office and Nationalized banks.
22) PPF account can be opened either in Post Office or in a Bank.
23) Account is transferable from one Post office to another and from Post office to Bank and from Bank to Post office.
24) Account is transferable from one Bank to another bank as well as within the bank to any branch.
25) Deposits in PPF qualify for rebate under section 80-C of Income Tax Act.
26) The interest on deposits is totally tax free.
27) Deposits are exempt from wealth tax.
28) The balance amount in PPF in PPF account is not subject to attachment under any order or decree of court in respect of any debt or liability.
29) Nomination facility available.
30) Best for long term investment.
2) The Scheme is for 15 years.
3) The rate of interest is 8% compounded annually.
4) The minimum deposit is 500/- and maximum is Rs. 70,000/- in a financial year.
5) One deposit with a minimum amount of Rs.500/- is mandatory in each financial year.
6) The deposit can be in lumpsum or in convenient installments, not more than 12 Installments in a year or two installments in a month subject to total deposit of Rs.70,000/-.
7) It is not necessary to make a deposit in every month of the year. The amount of deposit can be varied to suit the convenience of the account holders.
8) The account in which deposits are not made for any reasons is treated as discontinued account and such account can not be closed before maturity.
9) The discontinued account can be activated by payment of minimum deposit of Rs.500/- with default fee of Rs.50/- for each defaulted year.
10) Account can be opened by an individual or a minor through the guardian.
Joint account is not permissible.
11) Those who are contributing to GPF Fund or EDF account can also open a PPF account.
A Power of attorney holder can neither open or operate a PPF account.
12) The grand father/mother cannot open a PPF behalf of their minorgrand son/daughter.
The deposits shall be in multiple of Rs.5/- subject to minimum amount of Rs.500/-.
13) The deposit in a minor account is clubbed with the deposit of the account of the Guardian for the limit of Rs.70,000/-.
14) No age is prescribed for opening a PPF account.
15) Interest is not contractual but rate is notified by Ministry of Finance, Govt. of India, at the end of each year.
16) The facility of first withdrawal in the 7th year of the account subject to a limit of 50% of the amount at credit preceding three year balance. Thereafter one Withdrawal in every year is permissible.
17) Pre-mature closure of a PPF Account is not permissible except in case of death.
Nominee/legal heir of PPF Account holder on death of the account holder can not continue the account, but account had to be closed.
18) The account holder has an option to extend the PPF account for any period in a block of 5 years on each time.
19) The account holder can retain the account after maturity for any period without making any further deposits. The balance in the account will continue to earn interest at normal rate as admissible on PPF account till the account is closed.
20) One withdrawal in each financial year is also admissible in such account.
21) The PPF scheme is operated through Post Office and Nationalized banks.
22) PPF account can be opened either in Post Office or in a Bank.
23) Account is transferable from one Post office to another and from Post office to Bank and from Bank to Post office.
24) Account is transferable from one Bank to another bank as well as within the bank to any branch.
25) Deposits in PPF qualify for rebate under section 80-C of Income Tax Act.
26) The interest on deposits is totally tax free.
27) Deposits are exempt from wealth tax.
28) The balance amount in PPF in PPF account is not subject to attachment under any order or decree of court in respect of any debt or liability.
29) Nomination facility available.
30) Best for long term investment.
PROVIDENT FUND Vs PUBLIC PROVIDENT FUND
PROVIDENT FUND
Employee Provident Fund or provident fund :- is a retirement benefit scheme that is available to salaried employees. Under this scheme, a stipulated amount (currently 12%) is deducted from the employee's salary and contributed towards the fund. This amount is decided by the government. The employer also contributes an equal amount to the fund.However, an employee can contribute more than the stipulated amount if the scheme allows for it. So, let's say the employee decides 14% must be deducted towards the EPF. In this case, the employer is not obligated to pay any contribution over and above the amount as stipulated, which is 12%.
Return on this investment 8.5% per annum
Tenure of investmentThe amount accumulated in the PF is paid at the time of retirement or resignation. Or, it can be transferred from one company to the other if one changes jobs. In case of the death of the employee, the accumulated balance is paid to the legal heir
TAX TREATMENT :The amount you invest is eligible for deduction under the Rs 1,00,000 limit of Section 80C. If you have worked continuously for a period of five years, the withdrawal of PF is not taxed.If you have not worked for at least five years, but the PF has been transferred to the new employer, then too it is not taxed. The tenure of employment with the new employer is included in computing the total of five years. If you withdraw it before completion of five years, it is taxed. But if your employment is terminated due to ill-health, the PF withdrawal is not taxed.
PREMATURE WITHDRAWL : If you urgently need the money, you can take a loan on your PF.You can also make a premature withdrawal on the condition that you are withdrawing the money for your daughter's wedding (not son or not even yours) or you are buying a home. To find out the details, you will have to talk to your employer and then get in touch with the EPF office (your employer will help you out with this).
PUBLIC PROVIDENT FUND
The Public Provident Fund has been established by the central government. You can voluntarily decide to open one. You need not be a salaried individual, you could be a consultant, a freelancer or even working on a contract basis. You can also open this account if you are not earning. Any individual can open a PPF account in any nationalised bank or its branches that handle PPF accounts. You can also open it at the head post office or certain select post offices. The minimum amount to be deposited in this account is Rs 500 per year. The maximum amount you can deposit every year is Rs 70,000.
Return on this investment: 8% per annum
Tenure: The accumulated sum is repayable after 15 years along with the accrued interest
Reinvestment : The entire balance can be withdrawn on maturity, that is, after 15 years of the close of the financial year in which you opened the account.It can be extended for a period of five years after that. During these five years, you earn the rate of interest and can also make fresh deposits.
TAX TREATMENT :The amount you invest is eligible for deduction under the Rs 1,00,000 limit of Section 80C. On maturity, you pay absolutely no tax.
PREMATURE WITHDRAWL :You can take a loan on the PPF from the third year of opening your account to the sixth year. You are allowed to withdraw 50% of the balance at the end of the fourth year, preceding the year in which the amount is withdrawn or the end of the preceding year whichever is lower.
Employee Provident Fund or provident fund :- is a retirement benefit scheme that is available to salaried employees. Under this scheme, a stipulated amount (currently 12%) is deducted from the employee's salary and contributed towards the fund. This amount is decided by the government. The employer also contributes an equal amount to the fund.However, an employee can contribute more than the stipulated amount if the scheme allows for it. So, let's say the employee decides 14% must be deducted towards the EPF. In this case, the employer is not obligated to pay any contribution over and above the amount as stipulated, which is 12%.
Return on this investment 8.5% per annum
Tenure of investmentThe amount accumulated in the PF is paid at the time of retirement or resignation. Or, it can be transferred from one company to the other if one changes jobs. In case of the death of the employee, the accumulated balance is paid to the legal heir
TAX TREATMENT :The amount you invest is eligible for deduction under the Rs 1,00,000 limit of Section 80C. If you have worked continuously for a period of five years, the withdrawal of PF is not taxed.If you have not worked for at least five years, but the PF has been transferred to the new employer, then too it is not taxed. The tenure of employment with the new employer is included in computing the total of five years. If you withdraw it before completion of five years, it is taxed. But if your employment is terminated due to ill-health, the PF withdrawal is not taxed.
PREMATURE WITHDRAWL : If you urgently need the money, you can take a loan on your PF.You can also make a premature withdrawal on the condition that you are withdrawing the money for your daughter's wedding (not son or not even yours) or you are buying a home. To find out the details, you will have to talk to your employer and then get in touch with the EPF office (your employer will help you out with this).
PUBLIC PROVIDENT FUND
The Public Provident Fund has been established by the central government. You can voluntarily decide to open one. You need not be a salaried individual, you could be a consultant, a freelancer or even working on a contract basis. You can also open this account if you are not earning. Any individual can open a PPF account in any nationalised bank or its branches that handle PPF accounts. You can also open it at the head post office or certain select post offices. The minimum amount to be deposited in this account is Rs 500 per year. The maximum amount you can deposit every year is Rs 70,000.
Return on this investment: 8% per annum
Tenure: The accumulated sum is repayable after 15 years along with the accrued interest
Reinvestment : The entire balance can be withdrawn on maturity, that is, after 15 years of the close of the financial year in which you opened the account.It can be extended for a period of five years after that. During these five years, you earn the rate of interest and can also make fresh deposits.
TAX TREATMENT :The amount you invest is eligible for deduction under the Rs 1,00,000 limit of Section 80C. On maturity, you pay absolutely no tax.
PREMATURE WITHDRAWL :You can take a loan on the PPF from the third year of opening your account to the sixth year. You are allowed to withdraw 50% of the balance at the end of the fourth year, preceding the year in which the amount is withdrawn or the end of the preceding year whichever is lower.
PLANNING FOR AN INVESTMENT
What is Planning for an investment?
Art of Managing Money, would have made our lives so much easier. Most of us spend more than half of our lives working and saving because money is important, in fact crucial. However, most of us spend almost no time planning to make that hard-earned money work more effectively for us. So, how do you plan your financial life?
What is investment planning?
Financial planning is nothing but an assessment of your goals and the steps you must take to help make them a reality.
What is it that you want?
Is your wish to retire with a sound lumpsum amount or do you want a steady monthly income. Is your son's education or daughters' marriage worrying you? The key is to figure out your goals.
When to Invest?
The sooner the better. By investing into the market right away you allow your investments more time to grow, whereby the concept of compounding interest swells your income by accumulating your earnings and dividends. Considering the unpredictability of the markets, research and history indicates these three golden rules for all investors 1. Invest early2. Invest regularly3. Invest for long term and not short term There is always a first time for everything so also for investing. To invest you need capital free of any obligation. If you are not in the habit of saving sufficient amount every month, then you are not ready for investing. Our advice is :- Avoid unnecessary or lavish expenses as they add up to your savings. A dinner at Copper Chimney can always be avoided, the pleasures of avoiding it will be far greater if the amount is saved and invested. Clear all your high interest debts first out of the savings that you make. Credit card debts (revolving credits) and loans from pawnbrokers typically carry interest rates of between 24-36% annually. It is foolish to pay off debt by trying to first make money for that cause out of gambling or investing in stocks with whatever little money you hold. Infact its prudent to clear a portion of the debt with whatever amounts you have.
Where is your money going?
The most important thing is that you should where your money is going. Zero on your monthly and annual expenses.
Why should you invest?
You should invest so that your money grows and shields you against rising inflation. If prices rise by four per cent annually it would not be sufficient if your savings only give you a return of three per cent. It leaves you with a deficit of one per cent. The idea is that your rate of return on investments should be greater than the rate of inflation, leaving you with a nice surplus over a period of time.
Whether your money is invested in stocks, bonds, mutual funds or certificates of deposit (CD), the end result is to create wealth for retirement, marriage, college fees, vacations, better standard of living or to just pass on the money to the next generation. Also, it's exciting to review your investment returns and to see how they are accumulating at a faster rate than your salary.
Art of Managing Money, would have made our lives so much easier. Most of us spend more than half of our lives working and saving because money is important, in fact crucial. However, most of us spend almost no time planning to make that hard-earned money work more effectively for us. So, how do you plan your financial life?
What is investment planning?
Financial planning is nothing but an assessment of your goals and the steps you must take to help make them a reality.
What is it that you want?
Is your wish to retire with a sound lumpsum amount or do you want a steady monthly income. Is your son's education or daughters' marriage worrying you? The key is to figure out your goals.
When to Invest?
The sooner the better. By investing into the market right away you allow your investments more time to grow, whereby the concept of compounding interest swells your income by accumulating your earnings and dividends. Considering the unpredictability of the markets, research and history indicates these three golden rules for all investors 1. Invest early2. Invest regularly3. Invest for long term and not short term There is always a first time for everything so also for investing. To invest you need capital free of any obligation. If you are not in the habit of saving sufficient amount every month, then you are not ready for investing. Our advice is :- Avoid unnecessary or lavish expenses as they add up to your savings. A dinner at Copper Chimney can always be avoided, the pleasures of avoiding it will be far greater if the amount is saved and invested. Clear all your high interest debts first out of the savings that you make. Credit card debts (revolving credits) and loans from pawnbrokers typically carry interest rates of between 24-36% annually. It is foolish to pay off debt by trying to first make money for that cause out of gambling or investing in stocks with whatever little money you hold. Infact its prudent to clear a portion of the debt with whatever amounts you have.
Where is your money going?
The most important thing is that you should where your money is going. Zero on your monthly and annual expenses.
Why should you invest?
You should invest so that your money grows and shields you against rising inflation. If prices rise by four per cent annually it would not be sufficient if your savings only give you a return of three per cent. It leaves you with a deficit of one per cent. The idea is that your rate of return on investments should be greater than the rate of inflation, leaving you with a nice surplus over a period of time.
Whether your money is invested in stocks, bonds, mutual funds or certificates of deposit (CD), the end result is to create wealth for retirement, marriage, college fees, vacations, better standard of living or to just pass on the money to the next generation. Also, it's exciting to review your investment returns and to see how they are accumulating at a faster rate than your salary.
IPO INVESTMENT CHECKLIST
BEFORE MAKING AN INVESTMENT IN APPLYING IN ANY IPO (INITIAL PUBLIC OFFER ) , FOR A SMART INVESTOR ITS MANDATORY RATHER THAN CUSTOMARY TO CONSIDER AND JUDGE THE FOLLOWING POINTS:--
Is this an IPO or an FPO?
In IPOs, initial public offers, company decides the price band and the collective secondary market discovers the true price post-listing .
In FPOs, follow on public offers, the price is already discovered; gains/losses can only be marginal; no new information for the market to analyze.
Is this a fixed-price or a book-building issue?
The methodology, classes of investors and issue pricing are totally different.
There is no book or price discovery in a fixed-price issue.
There are no reservations for FIIs/HNIs in a fixed-price issue; 50% of the issue is reserved for small investors (in book building, it is 35%).
Fixed-price issues are typically small.
Is this a good promoter?
If the promoter is okay, almost all other factors will automatically get taken care of.
If there is any foreign collaboration of repute, it helps.
Experience in the same business/industry of the promotr is also a prime factor which guides the future of the company.
Is this an IPO or an FPO?
In IPOs, initial public offers, company decides the price band and the collective secondary market discovers the true price post-listing .
In FPOs, follow on public offers, the price is already discovered; gains/losses can only be marginal; no new information for the market to analyze.
Is this a fixed-price or a book-building issue?
The methodology, classes of investors and issue pricing are totally different.
There is no book or price discovery in a fixed-price issue.
There are no reservations for FIIs/HNIs in a fixed-price issue; 50% of the issue is reserved for small investors (in book building, it is 35%).
Fixed-price issues are typically small.
Is this a good promoter?
If the promoter is okay, almost all other factors will automatically get taken care of.
If there is any foreign collaboration of repute, it helps.
Experience in the same business/industry of the promotr is also a prime factor which guides the future of the company.
PPF : POSITIVE & NEGATIVE ASPECTS
POSITIVE ASPECTS OF PPF
a. It comes with a sovereign guarantee, and hence, peace of mind for a customer.
b. You can project the approximate maturity and the variation here might not be great.
c. It doesn't require any professional advice and hence you save on consultation fee of an investment advisor.
d. It makes you follow strict investment discipline.
e. PPF is a non-attachable savings instrument, hence in case of a worst-case scenario; the amount will still be available to your kid for education. There are certain exceptions in this, it is suggested that you may seek the advice of a qualified tax consultant on this point.
f. You can take a break in savings whenever you want and restart again.
g. There is very limited liquidity in early years, which helps with the goal of saving for your child's education.
NEGATIVE ASPECTS OF PPF
a.)15 years is a long term and in the event of interest rates going down, the target fund will get affected. Alternatively in such a scenario you will need to save more for the same amount on maturity. The possibility of this is quite high over such tenures.
b.)The savings have a guarantee from the Government of India. But most people ignore country default risk. The possibility of this is very low, but it is possible. It has happened in past to countries like Russia and Argentina. In the event of such thing happening the fallout will be great.
c.) The fixed rate of return on the investment makes you lose the opportunity to make higher returns on your investment, or what consultants term as 'opportunity loss'.
a. It comes with a sovereign guarantee, and hence, peace of mind for a customer.
b. You can project the approximate maturity and the variation here might not be great.
c. It doesn't require any professional advice and hence you save on consultation fee of an investment advisor.
d. It makes you follow strict investment discipline.
e. PPF is a non-attachable savings instrument, hence in case of a worst-case scenario; the amount will still be available to your kid for education. There are certain exceptions in this, it is suggested that you may seek the advice of a qualified tax consultant on this point.
f. You can take a break in savings whenever you want and restart again.
g. There is very limited liquidity in early years, which helps with the goal of saving for your child's education.
NEGATIVE ASPECTS OF PPF
a.)15 years is a long term and in the event of interest rates going down, the target fund will get affected. Alternatively in such a scenario you will need to save more for the same amount on maturity. The possibility of this is quite high over such tenures.
b.)The savings have a guarantee from the Government of India. But most people ignore country default risk. The possibility of this is very low, but it is possible. It has happened in past to countries like Russia and Argentina. In the event of such thing happening the fallout will be great.
c.) The fixed rate of return on the investment makes you lose the opportunity to make higher returns on your investment, or what consultants term as 'opportunity loss'.
FIXED HOME LOAN RATE
A quick comparison:
Bank Interest rate (%)
Punjab National Bank 11
State Bank of India 12.75
HDFC 13.25
ICICI Bank 13.75
HSBC 13.25
LIC Housing Finance 11.75
Bank Interest rate (%)
Punjab National Bank 11
State Bank of India 12.75
HDFC 13.25
ICICI Bank 13.75
HSBC 13.25
LIC Housing Finance 11.75
CHEAPEST FLOATING HOME LOAN RATE
Punjab National Bank is offering you the lowest floating rate home loan at 9%.
The table below gives a quick glimpse of banks offering floating rate home loans for a tenure of five years.
Bank name Interest rate (%)
Punjab National Bank 9
HSBC 12
HDFC 10.5
State Bank of India 12.75
ICICI Bank 11.25
LIC Housing Finance 11.25
Standard Chartered 13.05
Canara Bank 10.75
The table below gives a quick glimpse of banks offering floating rate home loans for a tenure of five years.
Bank name Interest rate (%)
Punjab National Bank 9
HSBC 12
HDFC 10.5
State Bank of India 12.75
ICICI Bank 11.25
LIC Housing Finance 11.25
Standard Chartered 13.05
Canara Bank 10.75
CREDIT CARD OFFERING MAXIMUM CREDIT PERIOD
HDFC bank offers the highest free credit period days on your credit card. This means you can enjoy your credit on the car without interest for these days.
Here is a comparison:
Bank Credit card type Free credit days
HDFC Bank Platinum Plus Credit Card 55
ICICI Bank Platinum Card, Solid Gold Credit Card,
Sterling Silver Credit Card, Online Credit Card 52
HSBC Gold Credit Card, Classic Credit Card 52
Standard Chartered Platinum Plus Credit Card 45
Citibank Platinum Card, Solid Gold Credit Card,
Sterling Silver Credit Card, Online Credit Card 45
Here is a comparison:
Bank Credit card type Free credit days
HDFC Bank Platinum Plus Credit Card 55
ICICI Bank Platinum Card, Solid Gold Credit Card,
Sterling Silver Credit Card, Online Credit Card 52
HSBC Gold Credit Card, Classic Credit Card 52
Standard Chartered Platinum Plus Credit Card 45
Citibank Platinum Card, Solid Gold Credit Card,
Sterling Silver Credit Card, Online Credit Card 45
WHEN DO CREDIT CARD BECOME DANGEROUS ?
A credit card has a lot of hidden costs which if an credit card neglect will have to pay more then what he would have ever expected.
In order to protect yourself from any unnecessary billing from credit card you should strictly keep in mind the following points :
You Should pay the minimum amount due
Whether you do it intentionally or unintentionally , you will bound to pay a late payment fee. This fee varies from bank to bank. If you do not pay for two consecutive months, you become a defaulter. Collection strategy then varies, depending on his risk score arrived ad from the amount outstanding, past record, individual profile/ profession. Further transactions will be blocked.
When you ever revolve your balance
Banks give you this option to pay a minimum prescribed amount and carry forward the rest to the next billing period. In this case, you will pay an interest on the outstanding amount. But the catch lies here: when you carry a balance from month to month, there is no grace period on new purchases with most cards which should be kept in mind.
Your payment cheque should never bounce:
You would have to bear a fee for dishonoured cheques. If you go beyond the due date, you become a delinquent case, and your risk profile shoots up. Also, all charges will be applicable – a fee for a bounced cheque, a late payment fee and monthly interest on outstanding amount
In order to protect yourself from any unnecessary billing from credit card you should strictly keep in mind the following points :
You Should pay the minimum amount due
Whether you do it intentionally or unintentionally , you will bound to pay a late payment fee. This fee varies from bank to bank. If you do not pay for two consecutive months, you become a defaulter. Collection strategy then varies, depending on his risk score arrived ad from the amount outstanding, past record, individual profile/ profession. Further transactions will be blocked.
When you ever revolve your balance
Banks give you this option to pay a minimum prescribed amount and carry forward the rest to the next billing period. In this case, you will pay an interest on the outstanding amount. But the catch lies here: when you carry a balance from month to month, there is no grace period on new purchases with most cards which should be kept in mind.
Your payment cheque should never bounce:
You would have to bear a fee for dishonoured cheques. If you go beyond the due date, you become a delinquent case, and your risk profile shoots up. Also, all charges will be applicable – a fee for a bounced cheque, a late payment fee and monthly interest on outstanding amount
CONCEPT BEHIND CREDIT CARD
Whenever an applicant apply for a new credit card, the bank you applied carefully screens your application.
A limit is worked out for the applicant determining the credit which could be sanctioned , based on your financial capability and other parameters like income levels, educational qualifications, age etc.
Generally cxredit card are issued by banks and big financing corporates like Reliance.
The bank that issues you the card is called the 'issuing bank'.
From the bank's point of view, credit cards are good business for two reasons:-
1)Banks make money through fees from merchant establishment.
2) The higher than normal interest rate paid by cardholders for the balance in their card.
Merchant establishments can be hotels, shops, travel agencies or any place where money transactions are made. The banks that enroll merchant establishments are called 'acquiring banks'.
The relationship between the bank and the merchant establishments is run via international networks such as Visa and Master card.
Your credit card is valid in any merchant establishment that accepts your network (ie Master Card or Visa), irrespective of the issuing bank. Most Indian card issuing banks are part of either Master Card network or Visa network, or both. There are others credit card networks like American Express and Diners Club too.
The merchant establishment finds the credit card a safer and efficient payment mode, and brings more business as it provide credit facility to there deemed customers thereby incresing the spending capacity of the customers. The merchant establishment pays a fee to the bank that enrolled it for the service.
A limit is worked out for the applicant determining the credit which could be sanctioned , based on your financial capability and other parameters like income levels, educational qualifications, age etc.
Generally cxredit card are issued by banks and big financing corporates like Reliance.
The bank that issues you the card is called the 'issuing bank'.
From the bank's point of view, credit cards are good business for two reasons:-
1)Banks make money through fees from merchant establishment.
2) The higher than normal interest rate paid by cardholders for the balance in their card.
Merchant establishments can be hotels, shops, travel agencies or any place where money transactions are made. The banks that enroll merchant establishments are called 'acquiring banks'.
The relationship between the bank and the merchant establishments is run via international networks such as Visa and Master card.
Your credit card is valid in any merchant establishment that accepts your network (ie Master Card or Visa), irrespective of the issuing bank. Most Indian card issuing banks are part of either Master Card network or Visa network, or both. There are others credit card networks like American Express and Diners Club too.
The merchant establishment finds the credit card a safer and efficient payment mode, and brings more business as it provide credit facility to there deemed customers thereby incresing the spending capacity of the customers. The merchant establishment pays a fee to the bank that enrolled it for the service.
BENIFITS OF MUTUAL FUNDS
EXPERT & PROFESSIONAL FOR FUND MANAGEMENT
Fund managers are responsible for implementing a consistent investment strategy that focus the goals of the fund. Fund managers monitor market and economic trends and analyze securities in order to make informed investment decisions.
Liquidity
Investors can sell their mutual fund units on any business day and receive the current market value on their investments within a period of three- to five-days.Payment delays are npowdays not found as SEBI keep a shrewd eye on the funds for not making any delays in payment for customers interest.
Diversification
Diversification is one of the best ways to minimise risk. Mutual funds offer investors an opportunity to diversify across assets depending on their investment needs.
Within Every one's reach
The minimum initial investment for a mutual fund is fairly low for most funds as low as Rs 500/ so it is every one's piece of bread where investor could invest as per his budget & capacity.
Convenience
Investing In mutual fund do not involve any complicated process , its nowdays so easy and conviniet not only to invest but get the redemption , renewal. Most private sector funds provide you the convenience of periodic purchase plans, automatic withdrawal plans and the automatic reinvestment of interest and dividends.Mutual funds also provide you with detailed reports and statements that make record-keeping simple. You can easily monitor the performance of your mutual funds simply by reviewing the business pages of most newspapers or by surfing net.
Income tax related documents are posted to the investor's address directly and in time.
Flexibility and variety
Customers have got variety of option in the market to choose the best which suits one investor. Several reputed corporat6es are involved making several offer with different investment options and schemes.
Tax benefit
1) 100% Income Tax exemption on all Mutual Fund dividends
2) Capital Gains Tax to be lower of - 10% on the capital gains without factoring indexation benefit and 20% on the capital gains after factoring indexation benefit.
Fund managers are responsible for implementing a consistent investment strategy that focus the goals of the fund. Fund managers monitor market and economic trends and analyze securities in order to make informed investment decisions.
Liquidity
Investors can sell their mutual fund units on any business day and receive the current market value on their investments within a period of three- to five-days.Payment delays are npowdays not found as SEBI keep a shrewd eye on the funds for not making any delays in payment for customers interest.
Diversification
Diversification is one of the best ways to minimise risk. Mutual funds offer investors an opportunity to diversify across assets depending on their investment needs.
Within Every one's reach
The minimum initial investment for a mutual fund is fairly low for most funds as low as Rs 500/ so it is every one's piece of bread where investor could invest as per his budget & capacity.
Convenience
Investing In mutual fund do not involve any complicated process , its nowdays so easy and conviniet not only to invest but get the redemption , renewal. Most private sector funds provide you the convenience of periodic purchase plans, automatic withdrawal plans and the automatic reinvestment of interest and dividends.Mutual funds also provide you with detailed reports and statements that make record-keeping simple. You can easily monitor the performance of your mutual funds simply by reviewing the business pages of most newspapers or by surfing net.
Income tax related documents are posted to the investor's address directly and in time.
Flexibility and variety
Customers have got variety of option in the market to choose the best which suits one investor. Several reputed corporat6es are involved making several offer with different investment options and schemes.
Tax benefit
1) 100% Income Tax exemption on all Mutual Fund dividends
2) Capital Gains Tax to be lower of - 10% on the capital gains without factoring indexation benefit and 20% on the capital gains after factoring indexation benefit.
UNDERSTANDING MUTUAL FUND
First we will understand Net Asset Value (NAV)
NAV is the total asset value per unit of the fund and is calculated by the AMC at the end of every business day.
NAV calculation
The value of all the securities in the portfolio in calculated daily. From this, all expenses are deducted and the resultant value divided by the number of units in the fund is the NAV.
Open- and Close-Ended Funds
Open-ended FundsAt any time during the scheme period, investors can enter and exit the fund scheme (by buying/ selling fund units) at its NAV (net of any load charge). Increasingly, AMCs are issuing mostly open-ended funds.2) Close-Ended FundsRedemption can take place only after the period of the scheme is over. However, close-ended funds are listed on the stock exchanges and investors can buy/ sell units in the secondary market (there is no load).
Expense Ratio
AMCs charge an annual fee, or expense ratio that covers administrative expenses, salaries, advertising expenses, brokerage fee, and other likewise charges. A 1.0% expense ratio means the AMC charges Rs1. for every Rs100 in assets under management.A fund's expense ratio is typically to the size of the funds under management and not to the returns earned. Normally, the costs of running a fund grow slower than the growth in the fund size - so, the more assets in the fund, the lower should be its expense ratio.
Load
Some AMCs have sales charges, or loads, on their funds (entry load / exit load or both) to compensate for distribution costs. Funds that can be purchased without a sales charge are called no-load funds.
Important documents
Two essential documents that focus the fund's strategy and performance are
1) Prospectus (legal document) and
2) Shareholder reports (normally quarterly).
NAV is the total asset value per unit of the fund and is calculated by the AMC at the end of every business day.
NAV calculation
The value of all the securities in the portfolio in calculated daily. From this, all expenses are deducted and the resultant value divided by the number of units in the fund is the NAV.
Open- and Close-Ended Funds
Open-ended FundsAt any time during the scheme period, investors can enter and exit the fund scheme (by buying/ selling fund units) at its NAV (net of any load charge). Increasingly, AMCs are issuing mostly open-ended funds.2) Close-Ended FundsRedemption can take place only after the period of the scheme is over. However, close-ended funds are listed on the stock exchanges and investors can buy/ sell units in the secondary market (there is no load).
Expense Ratio
AMCs charge an annual fee, or expense ratio that covers administrative expenses, salaries, advertising expenses, brokerage fee, and other likewise charges. A 1.0% expense ratio means the AMC charges Rs1. for every Rs100 in assets under management.A fund's expense ratio is typically to the size of the funds under management and not to the returns earned. Normally, the costs of running a fund grow slower than the growth in the fund size - so, the more assets in the fund, the lower should be its expense ratio.
Load
Some AMCs have sales charges, or loads, on their funds (entry load / exit load or both) to compensate for distribution costs. Funds that can be purchased without a sales charge are called no-load funds.
Important documents
Two essential documents that focus the fund's strategy and performance are
1) Prospectus (legal document) and
2) Shareholder reports (normally quarterly).
WHY MUTUAL FUND ?
Best Mode forLay man to invest in stocks and bonds
A mutual fund is not an alternative investment option to stocks and bonds, rather it assembles the money of several investors and invests the same in stocks, bonds, money market instruments and other types of securities.Buying a mutual fund is like buying a small part of a big game. The owner of a mutual fund unit gets a proportional share of the mutual fund gain or loss.
Every mutual fund has a specific objective
The fund’s objective is laid out in the fund's prospectus, which is the legal document that contains information about the fund, its history,its track record and past performances, its officers .
Most Common objectives of a mutual fund are -
What the fund will invest in
Equity (Growth) meaning only in stocks
Debt (Income) Only in fixed income securities
Money Market (including Gilt) In short-term money market instruments (including government securities) BalancedPartly in stocks and partly in fixed-income securities,in order to maintain a 'balance' in returns and risk
Managed by an asset management Company referred as AMC
The company that puts together a mutual fund is called an AMC. An AMC may have several mutual fund schemes with similar or varied investment objectives.The AMC hires a professional money manager, who buys and sells securities in line with the fund's stated objective.
All AMCs Regulated by SEBI, Funds governed by Board of Directors
The Securities and Exchange Board of India (SEBI) mutual fund regulations require that the fund’s objectives are clearly mentioned in the prospectus.Also every mutual fund has a board of directors that is supposed to represent the shareholders' interests rather than the AMC’s.
A mutual fund is not an alternative investment option to stocks and bonds, rather it assembles the money of several investors and invests the same in stocks, bonds, money market instruments and other types of securities.Buying a mutual fund is like buying a small part of a big game. The owner of a mutual fund unit gets a proportional share of the mutual fund gain or loss.
Every mutual fund has a specific objective
The fund’s objective is laid out in the fund's prospectus, which is the legal document that contains information about the fund, its history,its track record and past performances, its officers .
Most Common objectives of a mutual fund are -
What the fund will invest in
Equity (Growth) meaning only in stocks
Debt (Income) Only in fixed income securities
Money Market (including Gilt) In short-term money market instruments (including government securities) BalancedPartly in stocks and partly in fixed-income securities,in order to maintain a 'balance' in returns and risk
Managed by an asset management Company referred as AMC
The company that puts together a mutual fund is called an AMC. An AMC may have several mutual fund schemes with similar or varied investment objectives.The AMC hires a professional money manager, who buys and sells securities in line with the fund's stated objective.
All AMCs Regulated by SEBI, Funds governed by Board of Directors
The Securities and Exchange Board of India (SEBI) mutual fund regulations require that the fund’s objectives are clearly mentioned in the prospectus.Also every mutual fund has a board of directors that is supposed to represent the shareholders' interests rather than the AMC’s.
SPLIT OF SHARES MEANING
Split of share is to reduce the face value of the share. Say a face value of the stock is 10 and is split to 1 menas the one share will get convert to 10 shares but as the number of share will increase so the price will decrease in the same ratio as the worth of the stock has not boosted to such level so the value o the stock remain same after split also.Split of stock is done to reduce the stock trading value at index , whenever a stock get highly priced its volume of trading get reduced as it becomes out of reach of various traders so to improve the trading volume of the equity or make it more tradable for mass public the share is split to reduce the stock price. Spliting is also a positive news as the volume will increase in future and will boost the share price so split news also make a rise in the price of the stock.
BONUS SHARE / BONUS ALLOTMENT MEANING
Some times it is generally misconcepted by the share holder that allotment of bonus say in ratio 1:1 means that’s the number of the shares get doubled with the same price thereby doubling there stock value making 100% gain.This concept is hundred percent wrong t , forget that you can get 100% gain overnight.The basic concept is that when a company makes a profit it doesn’t distribute the entire portion of profit in form of dividend but keep reserving a part of profit every year for future needs of the company. That part of reserve is kept under liability head as “reserve & surplus” when there is need of capital or fund in the company for development , acquisition , new unit , research work etc the company instead of taking loan from the market they transfer the reserve to capital account whereby the equity get raised with same value so in such case the number of shares are increased in the ratio as the capital is increased and such increase in the number of shares will lead to bonus share allotment there is nothing that the company has got profit to doubalise your holding so only the no. of share held is doubled or increased in the ratio as bonus allotment. So as the number of share get increased in the ratio of bonus allotment but the price get reduced in the same ratio thereby making the total stock value same as before. The only profit of bonus issue is that when bonus allotment news is flashed the price of the stock soar as the company is going to do something positive for which the transfer of reserve to capital is done and that is the only gain a shareholder gain by bonus issue.
IPO & FPO
IPO stands for initial public offer , whereby a newly incorpoprated limited company issue its share of equity to the public. The compnay may have been working for past few years but when it enters the stock market and get enlist at stock exchange such as BSE , NSE etc it has to offer the authorised equity to the public in form of shares with face value (Generally 10/5/2/1) at par or premium , discount as per the financial position, goodwill and need of the company.A part of the total equity is issued to the promotor which is generally above 50% to be the authorised promotor and to hold the power of execution of various operations of the compnay. Karvy and many other such companies act as a lead manager of the compnay who whereby takes the entire charge of the public issue ruight from the stage of filing draft with SEBI for approval , to advertisement for suscription of the issue , finalising the price band , issue date etc.The allotment , payment receipt , final despatch of share certificate as per the allotment to the shareholders all jobs are done by the lead manager , who charge a handsome fee for the same.
Nowdays within 26 days of issue closure the allotment process is to be completed and the stock is listed at exchange on day or another after allotment. The refunds of unalloted applicants are to be sent within 10days after listing.In older days refunds were sent via cheque though it is now mandatory to be sent via ECS with an postal intimation regarding allotment result and its credit at clients dp directly as per the information provided in apllication form and refunds of the unalloted part at his bank via ecs as informed in the application form.
In order to make the process of listing faster SEBI has made it mandatory
1. To have PAN card for apllication.
2. To have DP account for share allotment , as no physiccal share to be issued and transacted anymore.
3. To Send refunds via ECS
After listing of the stock is done , it is permited to be trade in secondary market where buyers could buy the stock from the exisiting shareholder but not from the company. The stopck keep on trading every day several time hands change and titlte of ownership keep updated in the records of the comapny. In case of dividend , bonus , split a particular record date is finalsied and as on date the ownership belongs to whomever person is entilted to receive the credit of dividend , bonus and split may be he may sell off the share after the record date is crossed.
FPO stands for follow on public offer whereby a primarly listed compnay makes an additional public offer of it equity. In case the authorised capital of the company is not being fully issued in the capital market the compnay has the right to make an additional issue of public offer of the remaing portion of the authorised capital whereby passed intially or has been sanctioned later. This is done in case of need of capital in the company for several reasons such as development , acquisitions , research etc. When the authorised capital is sanctioned meaning the amount the company could raise from the capital market by issue of shares some company do not take the entire sum from the market by issuing total equity but keep a part of the authorised of equity and issue it later wqhen there is need of capital and that additional issue offering it's share to public is called FPO
The difference in getting allotment at IPO / FPO and buying it from the secondary market is that the price of allotment in IPO/FPO are more reasonable then the price at which the stock is traded in secondary market , so trader in order to encash short term profit apply for IPO/FPO and after getting allotment sell at secondary market to earn the difference in price.
Nowdays within 26 days of issue closure the allotment process is to be completed and the stock is listed at exchange on day or another after allotment. The refunds of unalloted applicants are to be sent within 10days after listing.In older days refunds were sent via cheque though it is now mandatory to be sent via ECS with an postal intimation regarding allotment result and its credit at clients dp directly as per the information provided in apllication form and refunds of the unalloted part at his bank via ecs as informed in the application form.
In order to make the process of listing faster SEBI has made it mandatory
1. To have PAN card for apllication.
2. To have DP account for share allotment , as no physiccal share to be issued and transacted anymore.
3. To Send refunds via ECS
After listing of the stock is done , it is permited to be trade in secondary market where buyers could buy the stock from the exisiting shareholder but not from the company. The stopck keep on trading every day several time hands change and titlte of ownership keep updated in the records of the comapny. In case of dividend , bonus , split a particular record date is finalsied and as on date the ownership belongs to whomever person is entilted to receive the credit of dividend , bonus and split may be he may sell off the share after the record date is crossed.
FPO stands for follow on public offer whereby a primarly listed compnay makes an additional public offer of it equity. In case the authorised capital of the company is not being fully issued in the capital market the compnay has the right to make an additional issue of public offer of the remaing portion of the authorised capital whereby passed intially or has been sanctioned later. This is done in case of need of capital in the company for several reasons such as development , acquisitions , research etc. When the authorised capital is sanctioned meaning the amount the company could raise from the capital market by issue of shares some company do not take the entire sum from the market by issuing total equity but keep a part of the authorised of equity and issue it later wqhen there is need of capital and that additional issue offering it's share to public is called FPO
The difference in getting allotment at IPO / FPO and buying it from the secondary market is that the price of allotment in IPO/FPO are more reasonable then the price at which the stock is traded in secondary market , so trader in order to encash short term profit apply for IPO/FPO and after getting allotment sell at secondary market to earn the difference in price.
HOME EQUITY
Equity refers to actual owner’s value as on date i.e it is the difference between the present fair value of the Home and amount payable on home loan plus any other outstanding liability related to that property.
HOME EQUITY LOAN
Home equity loan refers to the Loan sanctioned on home equity value i.e it is the loan on the owner’s current date value. After payment of E.M.I’s of the home loan the equity value of the purchaser starts accumulating or increasing after each payment. In case any additional liability is increased by any additional loan taken for repair , development etc will reduce the equity of the buyer.All Financial institutions including popular banks offer the facility of home equity loans. Generally it is found that in case of regular and timely payment of installment of home loan build a sound relationship with the financer and thereby considering the borrower having a sound financial base and capacity to repay they themselves offer the borrower for home equity loan and sanction a secondary loan on the paid up value or the equity value.Home equity loan rates are reasonable and affordable. The agent of home loan or the institution provide there home equity loan rate.Bad credit home equity loan thereby refers to those who had a bad goodwill by being defaulter in repayment of an existing loan or a old loan wants a home equity loan. More over home equity loans are also called simply equity loans.
HOME EQUITY LINE OF CREDIT
Keeping your home as a collateral a particular limit of credit is sanctioned to you which could be withdrawn as and when required from time to time. The credit pattern symbolizes the credit card system. Though house is mortgaged so user generally do not use there sanctioned limit to meet day to day expense but is used for any special purpose of higher education , medical bill payment , home improvement etc. Home equity rates of interest are very reasonable and interest is payable only on the credit limit used and for the period used.Equity loan of credit could be taken by mortgaging home called as home equity line of credit or by mortgaging any other security .
ELOAN
In the modern world where the entire world is reachable within a blink of an eye lash so applying loan is no more unwanted heavy paper work , bunches of documentary proof and agents problems. You may simply log on to the websites of different financial institutions to check out there rates and amenities to select the best option for you and could apply online and this facility of applying a loan online is called eloan.
HOME EQUITY LOAN
Home equity loan refers to the Loan sanctioned on home equity value i.e it is the loan on the owner’s current date value. After payment of E.M.I’s of the home loan the equity value of the purchaser starts accumulating or increasing after each payment. In case any additional liability is increased by any additional loan taken for repair , development etc will reduce the equity of the buyer.All Financial institutions including popular banks offer the facility of home equity loans. Generally it is found that in case of regular and timely payment of installment of home loan build a sound relationship with the financer and thereby considering the borrower having a sound financial base and capacity to repay they themselves offer the borrower for home equity loan and sanction a secondary loan on the paid up value or the equity value.Home equity loan rates are reasonable and affordable. The agent of home loan or the institution provide there home equity loan rate.Bad credit home equity loan thereby refers to those who had a bad goodwill by being defaulter in repayment of an existing loan or a old loan wants a home equity loan. More over home equity loans are also called simply equity loans.
HOME EQUITY LINE OF CREDIT
Keeping your home as a collateral a particular limit of credit is sanctioned to you which could be withdrawn as and when required from time to time. The credit pattern symbolizes the credit card system. Though house is mortgaged so user generally do not use there sanctioned limit to meet day to day expense but is used for any special purpose of higher education , medical bill payment , home improvement etc. Home equity rates of interest are very reasonable and interest is payable only on the credit limit used and for the period used.Equity loan of credit could be taken by mortgaging home called as home equity line of credit or by mortgaging any other security .
ELOAN
In the modern world where the entire world is reachable within a blink of an eye lash so applying loan is no more unwanted heavy paper work , bunches of documentary proof and agents problems. You may simply log on to the websites of different financial institutions to check out there rates and amenities to select the best option for you and could apply online and this facility of applying a loan online is called eloan.
STRUCTURED SETTLEMENT
First we would like to understand in a layman’s language that what do we mean by structured settlement? In India this term seems to be uncommon due to lack of it’s awareness though it is much popular in United States. In case an individual get physical disability or major injury due to misconduct or negligence of any individual or a company provided that he wins a lawful suit in the court thereby approving the incident . The injured person is sanctioned a particular remuneration by the court payable by the responsible party. The compensation could either be paid at once or it may be paid a lum sum at once and rest to be paid party in installment , this payment arrangement system is called a structured settlement.In India this system was enforced by the Congress Govt. considering the benefit of the claimant.In order to encourage the policy the govt. has exempted all taxes arising on the payment received as structured settlement. Thereby making this income as tax free. The Govt. wanted to promote this system because when a person get injured and if he receives the remuneration at once he is unable to manage the same and it is found that in maximum case the amount gets over due to high risk investment or personal loans thereby making the claimant dependent and helpless. In Structured settlement the person gets the particular settled amount every month for long span of time and he gets assured monthly income thereby giving a assured monthly support and protecting against any kind of helplessness.In general case life long structured settlement a minimum guarantee period is stated thereby assuring that even if the person expires before the minimum guarantee period the installment will be continued thereafter in the name of the appointed nominee.This system of structured settlement is to be asked at the time of the settlement at initial stages, once the agreement is formed and spot payment is agreed upon then the claimant can’t ask for any sort of structured settlement.Structured settlement money is allotted and approved at the time of agreement between both the parties. Thereafter both the parties are legally bound to abide by all the terms settled.
STRUCTURED SETTLEMENT COMPANIES
In order to protect the interest of the injured the structured settlement payment guarantee is to be provided so that he would be assured to get uninterrupted and regular payments.The company with a sound backup are authorize as structured settlement companies who will make payment to claimant on regular basis. Structured settlement companies are reliable and proper service could be expected without any sort of problem in future.
SELL STRUCTURED SETTLEMENTS.
In case you have opted for structured settlement considering the benefits as discussed above but as we know that future is always uncertain so in case in future u feel like getting a lump sum money against your secured settlement money and wanted to quit you have the option to sell structured settlements. One may need cash for settlement due to several reason like to purchase a house, payment for major hospital expense to be met for any other family member or thyself etc the reason may be friendly (for self convenience when he is no more dependent on the installment) or forcefully (which he is bound to take due to practical unavoidable reason). Though this agreement could not be breached in between but it’s legal right could be transferred to any third party with his consent or authority.If any claimant is interested to sell structured settlements there are various competitive offers available in the market. Whether it is a question to sell structured insurance settlement or a general structured settlement one may opt for the most suited offer to avail the maximum amount.After you sell your structured settlement one may get cash for settlement immediately after transferring the legal rights of structured settlement to the buyer.Structured settlement funding companies are seeking the opportunity to buy structured settlements. So it could be considered as a profitable decision for both the buyer and as well as sellor.
BUY STRUCTURED SETTLEMENTS.
Now the question arise that why will a third party interested to buy a structured settlement. This is due to several reasons namely 1. To get the tax benefit (As said above the amount so received is exempted from tax)2. Structured settlement lump sum payment is made by the buyer for purchasing the structured settlement. In simple language the investor who pays the cash for settlement will definitely like to enjoy the benefit for the same , so they pay much less amount in comparison to the amount receivable under structured settlement.
STRUCTURED SETTLEMENT COMPANIES
In order to protect the interest of the injured the structured settlement payment guarantee is to be provided so that he would be assured to get uninterrupted and regular payments.The company with a sound backup are authorize as structured settlement companies who will make payment to claimant on regular basis. Structured settlement companies are reliable and proper service could be expected without any sort of problem in future.
SELL STRUCTURED SETTLEMENTS.
In case you have opted for structured settlement considering the benefits as discussed above but as we know that future is always uncertain so in case in future u feel like getting a lump sum money against your secured settlement money and wanted to quit you have the option to sell structured settlements. One may need cash for settlement due to several reason like to purchase a house, payment for major hospital expense to be met for any other family member or thyself etc the reason may be friendly (for self convenience when he is no more dependent on the installment) or forcefully (which he is bound to take due to practical unavoidable reason). Though this agreement could not be breached in between but it’s legal right could be transferred to any third party with his consent or authority.If any claimant is interested to sell structured settlements there are various competitive offers available in the market. Whether it is a question to sell structured insurance settlement or a general structured settlement one may opt for the most suited offer to avail the maximum amount.After you sell your structured settlement one may get cash for settlement immediately after transferring the legal rights of structured settlement to the buyer.Structured settlement funding companies are seeking the opportunity to buy structured settlements. So it could be considered as a profitable decision for both the buyer and as well as sellor.
BUY STRUCTURED SETTLEMENTS.
Now the question arise that why will a third party interested to buy a structured settlement. This is due to several reasons namely 1. To get the tax benefit (As said above the amount so received is exempted from tax)2. Structured settlement lump sum payment is made by the buyer for purchasing the structured settlement. In simple language the investor who pays the cash for settlement will definitely like to enjoy the benefit for the same , so they pay much less amount in comparison to the amount receivable under structured settlement.
INSURANCE
The term Insurance itself reveals its meaning i.e to get insured.It protect against any injury , damage or mishap caused due to any accident , theft , fire etc.
There are several types of insurance including Life Insurance , Auto Insurance , Fire Insurance , Shop Insurance etc.Among which Life Insurance and Auto Insurance are a must.
LIFE INSURANCE
"Insurance is subject matter of solicitation"This is the most most common proverb we are listening but ironically not following the same as maximum percentage of us don't even try to understand the meaning of the statement and hardly interested to know the benifits of the insurance.Insurance is as essential as other legal documents say birth certificate , pan card etc.Though we don't have got legal bounding to get insured but we should individualy make insurance as a mandatory factor under our family rules.Even every new born member should get insured at the earliest eligible age. Not only infants but all of us should get insured due to some of the following principal causes:1. To protect against any uncertanity of accident , death.2. To secure future of the dependant of the family , who become helpless in case of any mishap.3. To enjoy redemption of premium paid.4. To get higher return in form of bonus , loyalty bonus and additional bonus etc.Nowdays in this competitive market several public & private companies are into this market of Insurance offering several types of policies for making it user friendly and helpful as per different needs and requirements.Some of the most popular types of insurance provider are LIC , Reliance , TATA , ICICI etc These insurance provider have several authorised agents in all cities , who are well trained who guides the customers about the different policies , plans , terms etc. In order to get the life insurance quotes one may either conatct these agents or may log on to respective websites of the companies to get an instant life insurance quotes.However some people want to avoid going through the channel of agents , to protect there interest nowdays online insurance has been executed whereby through these online insurance one may not only have a new insurance policy but could also pay the premium online.Browsing net will help to locate a cheap life insurance i.e the policy which suits an individual and well as the insurance company offering the cheapest life insurance or offering the best discount life insurance policy.
AUTO INSURANCE
Auto insurance covers the insurance of all sort of vehicles including two wheelers , four wheelers whether private or commercial. It is covered for both light motor vehicle as well as heavy motor vehicle. Auto insurance helps to protect from the loss incurred due to accidents , theft and other mishaps , which is very certain nowdays. In case of any damage caused to the vehicle by any accident the entire expense met for repairing is payable by the insurance companies.Nowdays like personal insurance cash less system has been introduced in auto insurance ,whereby submitting the card at the garage will make a direct payment to the garage company and the insured will not be liable to pay the bill initially and then make a claim for reimbursement. Introduction of this system has made the process much easier and user friendly avoiding any sort of harassment and delay in processing of a claim.Though third party insurance (Whereby no charges are paid for any damage) with minimum premium is mandatory, failing of which is subject to fine. But first party insurance covering all sort of damages are customary and depending on individual decision.No claim bonus facility is also available in auto insurance whereby the insured get a handsome discount on the premium payable for putting any claim during the last insured period.Auto insurance is done initially at the time of delivery of the car from the showroom and thereby keep renewing every year till its existence.Several auto insurance companies are offering competitive premium option with much better facilities for auto insurance. Auto insurance quotes or car insurance quotes refers to the premium payable for getting insured depending upon the IDV (Insured Declared Value) , the no. of time policy is renewed , last claim details etc. Tata , Relaince , Bajaj, Royal Sundaram , ICICI are the most popular auto insurance companies. In order to get insurance quotes for your vehicle you may contact any of the named companies.Insurance quotes are nowdays available online and there is no need to consult any agent for getting auto insurance quotes.
There are several types of insurance including Life Insurance , Auto Insurance , Fire Insurance , Shop Insurance etc.Among which Life Insurance and Auto Insurance are a must.
LIFE INSURANCE
"Insurance is subject matter of solicitation"This is the most most common proverb we are listening but ironically not following the same as maximum percentage of us don't even try to understand the meaning of the statement and hardly interested to know the benifits of the insurance.Insurance is as essential as other legal documents say birth certificate , pan card etc.Though we don't have got legal bounding to get insured but we should individualy make insurance as a mandatory factor under our family rules.Even every new born member should get insured at the earliest eligible age. Not only infants but all of us should get insured due to some of the following principal causes:1. To protect against any uncertanity of accident , death.2. To secure future of the dependant of the family , who become helpless in case of any mishap.3. To enjoy redemption of premium paid.4. To get higher return in form of bonus , loyalty bonus and additional bonus etc.Nowdays in this competitive market several public & private companies are into this market of Insurance offering several types of policies for making it user friendly and helpful as per different needs and requirements.Some of the most popular types of insurance provider are LIC , Reliance , TATA , ICICI etc These insurance provider have several authorised agents in all cities , who are well trained who guides the customers about the different policies , plans , terms etc. In order to get the life insurance quotes one may either conatct these agents or may log on to respective websites of the companies to get an instant life insurance quotes.However some people want to avoid going through the channel of agents , to protect there interest nowdays online insurance has been executed whereby through these online insurance one may not only have a new insurance policy but could also pay the premium online.Browsing net will help to locate a cheap life insurance i.e the policy which suits an individual and well as the insurance company offering the cheapest life insurance or offering the best discount life insurance policy.
AUTO INSURANCE
Auto insurance covers the insurance of all sort of vehicles including two wheelers , four wheelers whether private or commercial. It is covered for both light motor vehicle as well as heavy motor vehicle. Auto insurance helps to protect from the loss incurred due to accidents , theft and other mishaps , which is very certain nowdays. In case of any damage caused to the vehicle by any accident the entire expense met for repairing is payable by the insurance companies.Nowdays like personal insurance cash less system has been introduced in auto insurance ,whereby submitting the card at the garage will make a direct payment to the garage company and the insured will not be liable to pay the bill initially and then make a claim for reimbursement. Introduction of this system has made the process much easier and user friendly avoiding any sort of harassment and delay in processing of a claim.Though third party insurance (Whereby no charges are paid for any damage) with minimum premium is mandatory, failing of which is subject to fine. But first party insurance covering all sort of damages are customary and depending on individual decision.No claim bonus facility is also available in auto insurance whereby the insured get a handsome discount on the premium payable for putting any claim during the last insured period.Auto insurance is done initially at the time of delivery of the car from the showroom and thereby keep renewing every year till its existence.Several auto insurance companies are offering competitive premium option with much better facilities for auto insurance. Auto insurance quotes or car insurance quotes refers to the premium payable for getting insured depending upon the IDV (Insured Declared Value) , the no. of time policy is renewed , last claim details etc. Tata , Relaince , Bajaj, Royal Sundaram , ICICI are the most popular auto insurance companies. In order to get insurance quotes for your vehicle you may contact any of the named companies.Insurance quotes are nowdays available online and there is no need to consult any agent for getting auto insurance quotes.
MUTUAL FUND : A SAFE EQUITY INVESTMENT
Equity market offers very high return then any other option of investment and that is the cause people are attracted towrds stock market. Though the risk involvement in this stock market investment is highest whereby the entire principal invested is entirely at risk. Either you may gain huge amount while on other day you might even lose your investment itself. As the risk involvement is the highest in equity market so the return is also highest. As we know profit is the reward of risk taking.Higher the risk higher is profit earning probability.
Different people should adopt different policies to invest in stock market. First if you can't afford to lose money or make loss do not eneter stock market. If you want to invest only invest the amount you can afford to forgive or don't have obligation of it's availabilty on a particular date.Greed to get more profit in short term period can throw you in risk , this is the basic cause people invest in stock market there hard earned money or savings kept for some special unavodable social purpose which when not invested properly may drain off your entire investment falling you in deep problem both financially and physically including deepression , Heart etc and may lead to suicide tendency or suicide itself.
If you do not have any trading idea and couldn't spare much time to research but had a wish to invest in equity market than mutual fund are the best guiders available. They accumulate the funds of various people and invest in market through market experts and so called gurus. The profit earned is distributed among the investors in there investment ratio. Though the income generated from this source is limited and do not generate high yiel;d as of direct equity investment but the risk involvement is the least.
One may invest one time or systematically. either a lum sum amount could be invested in mutual fund or systematic investment plan could be opted whereby monthly equated investment is made.
Growth plan and dividend plan are the two plans whereby growth plan help to reinvest the amount earned from time to time giving higher returns on redemption while in dividend plan the profit earned is distributed from time to time.
Open end mutual fund could be brought and sold any time while in case of closed end mutual fund only a limited time it is offered to public as in case of IPO's.
Some of the funds charge entry load and exit load which is a type of brokerage while in some cases it is totally extinguished.
Different people should adopt different policies to invest in stock market. First if you can't afford to lose money or make loss do not eneter stock market. If you want to invest only invest the amount you can afford to forgive or don't have obligation of it's availabilty on a particular date.Greed to get more profit in short term period can throw you in risk , this is the basic cause people invest in stock market there hard earned money or savings kept for some special unavodable social purpose which when not invested properly may drain off your entire investment falling you in deep problem both financially and physically including deepression , Heart etc and may lead to suicide tendency or suicide itself.
If you do not have any trading idea and couldn't spare much time to research but had a wish to invest in equity market than mutual fund are the best guiders available. They accumulate the funds of various people and invest in market through market experts and so called gurus. The profit earned is distributed among the investors in there investment ratio. Though the income generated from this source is limited and do not generate high yiel;d as of direct equity investment but the risk involvement is the least.
One may invest one time or systematically. either a lum sum amount could be invested in mutual fund or systematic investment plan could be opted whereby monthly equated investment is made.
Growth plan and dividend plan are the two plans whereby growth plan help to reinvest the amount earned from time to time giving higher returns on redemption while in dividend plan the profit earned is distributed from time to time.
Open end mutual fund could be brought and sold any time while in case of closed end mutual fund only a limited time it is offered to public as in case of IPO's.
Some of the funds charge entry load and exit load which is a type of brokerage while in some cases it is totally extinguished.
CREDIT POLICIES TO CHECK INFLATION
RBI Issue credit policy from time to time in order to check inflation problem of the country and to control liquidity position of the country. The credit policy basicaly includes repo rate , reverse repo rate , C.R.R.
Now we like to understand what we mean by repo rate ? Repo rate is the rate of ineterest at which R.B.I (Banker's bank) lend money to the bank. (If Any bank wants funds from the central bank (RBI) the rate of interest payable by him on the funds borrowed is repo rate)
Reverse repo rate as the word depicts it's meaning itself that it is reverse of the repo rate so if a bank wishes to deposit the excess fund with the bank to the central bank the rate of interest receiveable on the funds deposited is called reverse repo rate.
C.R.R refers to central reserve ratio refers to the total percentage of the reserve of the bank of the depositors fund. The total fund lying with the bank anytime of there depositors a part of it is to be depositied with the RBI in order to protect the interest of the depositors in case of liquidation or bankruptcy.
In order to control the flow of the money in the market to check inflation Reserve bank used ti hike C.R.R (To Increase the deposit percentage pulling awaay the cash from bank), Repo Rate hike will lead to hike in bank loan lending rates(P.L.R i.r prime lending rate) thereby reducing numbers of loan borrowers from the bank and reverse repo rate hike will attract people towards savings as higher deposit rate will fetch them good return.
Now we like to understand what we mean by repo rate ? Repo rate is the rate of ineterest at which R.B.I (Banker's bank) lend money to the bank. (If Any bank wants funds from the central bank (RBI) the rate of interest payable by him on the funds borrowed is repo rate)
Reverse repo rate as the word depicts it's meaning itself that it is reverse of the repo rate so if a bank wishes to deposit the excess fund with the bank to the central bank the rate of interest receiveable on the funds deposited is called reverse repo rate.
C.R.R refers to central reserve ratio refers to the total percentage of the reserve of the bank of the depositors fund. The total fund lying with the bank anytime of there depositors a part of it is to be depositied with the RBI in order to protect the interest of the depositors in case of liquidation or bankruptcy.
In order to control the flow of the money in the market to check inflation Reserve bank used ti hike C.R.R (To Increase the deposit percentage pulling awaay the cash from bank), Repo Rate hike will lead to hike in bank loan lending rates(P.L.R i.r prime lending rate) thereby reducing numbers of loan borrowers from the bank and reverse repo rate hike will attract people towards savings as higher deposit rate will fetch them good return.
HIGHEST RETURN YIELDING INVESTMENT : FIXED DEPOSIT
Among the various forms of investment opprotunities available in the current market for lay man including postal savings , bank deposit , mutual funds , metal (gold / silver) , Insurance , bonds etc there are few options offering much higher rate of return in comparision to others.
Due to inflation problem in the country whereby the figure of inflation is increasing at tremendous speed every week thereby quoting above 11% though it is expected to stay within a range of below 5% mark for smooth credit policies and average 9% growth rate maintainence . In order to check the problem RBI credit Policies updated from time to time stating repo rate , reverse repo rate , bank rate , Central Reserve ratio etc are introduced to control the money flow in the market and liquidity concerns.
As per the various market return options fixed deposit is nowdays offering the highest return on investement. The rate of interest has jumped from 5.50% slab to 9.5%. This is secured form of investment with assurance of redemption on a particular date for the period deposited for. There is no risk involvement in this investment. Also on the last budget Fixed deposit for 5years and above is included under 80c thereby allowing the tax benifit to the asseessee provided it could not be redeemed before maturity.
Rate of interest vary from bank to bank and for period of investment.Previously long term deposit attarct higher rate of ineterst but nowdays small period fixed deposit attract much higher rate of interest as bankers expect that the rate of interst to fall in near future and the current high rate is due to political unstability , crude price , infation in the copuntry.
Among various Banks Federal Bank , Allahabad bank offer highest rate of interest than any other bank for short to medium and long term.
Due to inflation problem in the country whereby the figure of inflation is increasing at tremendous speed every week thereby quoting above 11% though it is expected to stay within a range of below 5% mark for smooth credit policies and average 9% growth rate maintainence . In order to check the problem RBI credit Policies updated from time to time stating repo rate , reverse repo rate , bank rate , Central Reserve ratio etc are introduced to control the money flow in the market and liquidity concerns.
As per the various market return options fixed deposit is nowdays offering the highest return on investement. The rate of interest has jumped from 5.50% slab to 9.5%. This is secured form of investment with assurance of redemption on a particular date for the period deposited for. There is no risk involvement in this investment. Also on the last budget Fixed deposit for 5years and above is included under 80c thereby allowing the tax benifit to the asseessee provided it could not be redeemed before maturity.
Rate of interest vary from bank to bank and for period of investment.Previously long term deposit attarct higher rate of ineterst but nowdays small period fixed deposit attract much higher rate of interest as bankers expect that the rate of interst to fall in near future and the current high rate is due to political unstability , crude price , infation in the copuntry.
Among various Banks Federal Bank , Allahabad bank offer highest rate of interest than any other bank for short to medium and long term.
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STOCKS TO BUY
Stock market is running under a cyclical bear phase and trapped under the bear cycle at present. After a continuous bull phase from 2003 though traders were expecting a sudden correction in the market .Instead it was expected to show extra ordinary fall but trdaers were not prepared for it as most of the investors and as well as the traders were holding all there positions in dps in January 2008 when the market crashed and have yet not recovered and showing a new year low day after day.
Reliance power IPO has a warm welcome and people has given a overwhelm response.Thereby neglecting the fear of correction and thereby the market has trapped all investors.
At intial fall the traders begin averaging there stock but the stock has shown a 50% cut and traders are fade up of averaging there portfolio.Now the investors are finding it difficult to hold on there stocks and have started to drown there holdings to realise there invested value along with minimum profit left out.
Market is expected to reach 10,000 on ground of soaring oil prices , political unstability.At 10 000 index a buy list could be made.
Reliance power IPO has a warm welcome and people has given a overwhelm response.Thereby neglecting the fear of correction and thereby the market has trapped all investors.
At intial fall the traders begin averaging there stock but the stock has shown a 50% cut and traders are fade up of averaging there portfolio.Now the investors are finding it difficult to hold on there stocks and have started to drown there holdings to realise there invested value along with minimum profit left out.
Market is expected to reach 10,000 on ground of soaring oil prices , political unstability.At 10 000 index a buy list could be made.
LOANS
Borrowing of money from someone is simply called loan. It could be a personal loan , which is procured from personal sources or a Institutional loan which is borrowed by any financial institution including Banks , Finance companies etc. Loans are borrowed by both individuals and as well as companies and corporate though the need , amount , term and interest vary in each case.Loan may be taken to meet certain requirement which requires a lump sum money and due to cash shortage.Which would be paid back to the lender with interest either in E.M.I (Equated Monthly Instalment) or down payment at once.Institutional loan are generally Instalment based while Personal loan are under down payment option.An interest is to be paid as remuneration to the lender for period the loan is used. The interest varies from source to source but overall it is guided by the credit policies of R.B.I including the Repo rate (The rate at which all banks get loan from R.B.I ), reverse repo rate (The rate at which banks could deposit there extra funds with R.B.I) C.R.R(Central reserve ratio is the minimum percentage of the total deposit with the bank to be kept with R.B.I to secure the interest of the depositor in case of any bankruptcy or liquidation of the Bank. Different Banks and institutions rate of interest varies as per there personal financial position , liquidity , existing loans sanctioned , existing deposit and there speculation of changes in interest rate in future.
SECURED LOAN :
loan against which a security is mortgaged with the lender is a secured Loan. This loan may also be reffered as collateral loan.After complete repayment of loan with interest for the period the mortgaged security is returned back As the risk involvement in this type of loan is minimum so secured loan is available at the cheapest rate in comparision or any sort of other loan. The execution of secured loans are also the fatest.Auto Loan , Home loan are most common secured loan.It is found that generally Institutional loan are secured lenders while private loans are unsecured loan lenders.
Secured Personal Loan :
It refers to those P.L (Personal Loans) which are sanctioned against mortgaging a security with the financer. After complete payment of the loan with interest till date , a N.O.C is issued by the lender and the security kept is returned back in as it is condition.
Secured Loan Rate :
The interest rate at which a secured loan could be procured is said to be a secured loan rate. Various banks and financial institutions offers different secured loan rate. In order to get the best secured loan one may check out and compare the offers before opting for any.This market study will help to determine the bestSecured loan.
Secured Home loan :
Buying a home financed by third party is home loan. Home loan is called a secured loan as the payment to the owner is made directly to the owner of the property and the title of holding remain with the financer.It could be said as hypothecated with the financer. After complete payment of home loan is made by the borrower the party gets a No Objection certificate and the legal rights to get the title of the property. In case the borrower gets defaulter the financer has got the rights to liquidate the property to realize the financed amount.
SECURED LOAN :
loan against which a security is mortgaged with the lender is a secured Loan. This loan may also be reffered as collateral loan.After complete repayment of loan with interest for the period the mortgaged security is returned back As the risk involvement in this type of loan is minimum so secured loan is available at the cheapest rate in comparision or any sort of other loan. The execution of secured loans are also the fatest.Auto Loan , Home loan are most common secured loan.It is found that generally Institutional loan are secured lenders while private loans are unsecured loan lenders.
Secured Personal Loan :
It refers to those P.L (Personal Loans) which are sanctioned against mortgaging a security with the financer. After complete payment of the loan with interest till date , a N.O.C is issued by the lender and the security kept is returned back in as it is condition.
Secured Loan Rate :
The interest rate at which a secured loan could be procured is said to be a secured loan rate. Various banks and financial institutions offers different secured loan rate. In order to get the best secured loan one may check out and compare the offers before opting for any.This market study will help to determine the bestSecured loan.
Secured Home loan :
Buying a home financed by third party is home loan. Home loan is called a secured loan as the payment to the owner is made directly to the owner of the property and the title of holding remain with the financer.It could be said as hypothecated with the financer. After complete payment of home loan is made by the borrower the party gets a No Objection certificate and the legal rights to get the title of the property. In case the borrower gets defaulter the financer has got the rights to liquidate the property to realize the financed amount.
REFINANCING
WHAT IS REFINANCING ?
Refinancing refer to shift from a existing debt agreement between a financer (who lends money) and borrower (who borrows money) to a new agreement with new terms & conditions mutually agreed upon by both the borrower and lender as well. Refinancing could be done either with same lender or may be shifted to another lender with better terms.
WHY REFINANCE LOANS?
Refinancing is generally done due to following main reasons:1. Rate of Interest : Due to significant change in interest rate (PLR) customers used to refinance there exisiting loan to get benifited of the reduction in lending rates (caused by RBI new credit policies) this helps to reduce the E.M.I payable by the borrower thereby reducing the debt obligation.2. Principal amount of loan : The borrower may have need of higher amount of the exisiting loan amount to meet up other needs, so in such case it may ask to refinance provided he has got the eligibilty for a sanction of higher loan.3. Time Span of loan repayment : In order to reduce the repayment burden the borrower may ask for refinancing for a longer span to autimatically reduce the E.M.I but payable for a much longer period. Vice versa he may ask for reduction in the loan period as he found himself capable to pay higher E.M.I and square off the loan earlier with low financing interest.4. Change in option : Flexi ineterst rate loan (Where interest payable depends on current interest rate , which alter time to time affected by latest credit policies by RBI) could be shifted to fixed rate loan(Where interest payable at fixed interest rate , not affected by new credit policies by RBI) by refinancing or vice versa.and due to many other reasons it is done as per the requirement of the borrower. It is generally seen that home refinancing is most poplular among various loan options.
Refinance Mortgage
Refinance mortgage loan is to shift from an existing mortgage loan to another loan. This loan is taken on same security asset and is borrowed to settle off the exisiting loan.If there is any additional amount received after settlement of exisiting loan that could only be utilized for meeting any other expense.This is generally done to change the terms of the exisiting loan (As discussed above).
Refinance Home:
Home refinancing is to shift the present home loan to a new one either with the same lender or with a new lender having better terms related to rate of refinancing , period of payment and sanctioned loan. If higher amount of loan is sanctioned it could be utilized for furniture and decoration in home and other co related purposes.
Refinance Rate :
Refinance rate refer to the rate of interest at which the refinancing is done.Generally the rate of interest on loan refinanced is low in comparison to the existing loan and that is principal cause of refinancing.Low refinancingIn the present world of competition different institutions are offering competitive rate for financing thereby attracting customers to shift there existing loan to a new one. The various rate of interest offered in the market could be known by net ,agents and branch office.Bad Credit Refinanace Loan If a individual have a bad track record , meaning defaulter in repayment of loan by E.M.I . In case a borrower fails to make a regular and timely payment of all installment in due date the individual is recorded under bad credit loan. In order to refinance a bad credit loan the rate of interest are much higher (2% to 6%) depending upon case.
Refinancing refer to shift from a existing debt agreement between a financer (who lends money) and borrower (who borrows money) to a new agreement with new terms & conditions mutually agreed upon by both the borrower and lender as well. Refinancing could be done either with same lender or may be shifted to another lender with better terms.
WHY REFINANCE LOANS?
Refinancing is generally done due to following main reasons:1. Rate of Interest : Due to significant change in interest rate (PLR) customers used to refinance there exisiting loan to get benifited of the reduction in lending rates (caused by RBI new credit policies) this helps to reduce the E.M.I payable by the borrower thereby reducing the debt obligation.2. Principal amount of loan : The borrower may have need of higher amount of the exisiting loan amount to meet up other needs, so in such case it may ask to refinance provided he has got the eligibilty for a sanction of higher loan.3. Time Span of loan repayment : In order to reduce the repayment burden the borrower may ask for refinancing for a longer span to autimatically reduce the E.M.I but payable for a much longer period. Vice versa he may ask for reduction in the loan period as he found himself capable to pay higher E.M.I and square off the loan earlier with low financing interest.4. Change in option : Flexi ineterst rate loan (Where interest payable depends on current interest rate , which alter time to time affected by latest credit policies by RBI) could be shifted to fixed rate loan(Where interest payable at fixed interest rate , not affected by new credit policies by RBI) by refinancing or vice versa.and due to many other reasons it is done as per the requirement of the borrower. It is generally seen that home refinancing is most poplular among various loan options.
Refinance Mortgage
Refinance mortgage loan is to shift from an existing mortgage loan to another loan. This loan is taken on same security asset and is borrowed to settle off the exisiting loan.If there is any additional amount received after settlement of exisiting loan that could only be utilized for meeting any other expense.This is generally done to change the terms of the exisiting loan (As discussed above).
Refinance Home:
Home refinancing is to shift the present home loan to a new one either with the same lender or with a new lender having better terms related to rate of refinancing , period of payment and sanctioned loan. If higher amount of loan is sanctioned it could be utilized for furniture and decoration in home and other co related purposes.
Refinance Rate :
Refinance rate refer to the rate of interest at which the refinancing is done.Generally the rate of interest on loan refinanced is low in comparison to the existing loan and that is principal cause of refinancing.Low refinancingIn the present world of competition different institutions are offering competitive rate for financing thereby attracting customers to shift there existing loan to a new one. The various rate of interest offered in the market could be known by net ,agents and branch office.Bad Credit Refinanace Loan If a individual have a bad track record , meaning defaulter in repayment of loan by E.M.I . In case a borrower fails to make a regular and timely payment of all installment in due date the individual is recorded under bad credit loan. In order to refinance a bad credit loan the rate of interest are much higher (2% to 6%) depending upon case.
ALTERNATIVE ENERGY MUTUAL FUNDS
ALTERNATIVE ENERGY MUTUAL FUNDS REFER TO THOSE MUTUAL FUNDS WHO INVEST THE ACCUMULATED AMOUNT IN SECTOR OF ALTERNATIVE ENERGY SOURCES.MUTUAL FUND ARE THE PROPER CHANNEL FOR LAYMAN TO INVEST IN STOCK MARKET. IF YOUDO NOT HAVE ANY IDEA IN STOCK MARKET BUT WANTS TO GET BENIFITED OF EXTRA ORDINARY GAINS GENERATED IN THIS FIELD THEN MUTUAL FUNDS ARE THE BEST WAY. THEY ACCUMULATE THE AMOUNT INVESTED BY SEVERAL INVESTOR THEREBY GENERATIUNG A HUGE AMOUNT WHICH WHEN INVESTED BY EXPERT AND LEADERS OF THE INDUSTRY GENERATES THE SECURED AND BEST RETURN WHICH IS FURTHER DISTRIBUTED AMONG THE INVESTORS IN THERE INVESTMENT RATIO.VARIOUS SCHEMES OF MUTUAL FUNDS ARE INTRODUCED BOTH OPEN END AND CLOSED END FROM TIME TO TIME.ALTERNATIVE ENERGY MUTAL FUNDS HAVE BETTER FUTURE AS IF THERE IS FUTURE OF THIS FIELD DUE TO EXCESSIVE HIKE IN CRUDE OIL AND EVER INCREASING DEMAND OF THE SAME SO THERE IS DEFINATE BULL RUN COMING IN THIS SECTOR.
DISCOUNT STOCK BROKERS
Discount stock brokers are those who offer a very low brokerage for trading. These brokers only provide the facility of trading at stock exchange but do not provide any advisory facility to the traders to trade. These brokers are suitable for those who do not need any guidance either they have better guidance source or they personally tarck the market and makes a judgement.For new traders who have no idea or any knowledge of stock market then they must not opt for these brokers.These brokers do not have a reasearch team and analysers reducing there cost and hence they offer cheaper rates.
ONLINE STOCK BROKERS
Online stock broker refers to those stock market broker , who enable the user to transact online. The client have got the power to self operate in Equity , Derivatives as per the limit sanctioned depending upon the terms finalised by different brokers. Some broker provide credit facility on basis of security deposit while some allow to transact as per the associated bank balance at the time of transaction. Nowdays online brokers ask to open a three in one account including trading account , DP account and Savings account. The brokerage charged by these brokers are higher in comparision to other. Thses stock broker also facitilate ticker , which helps to keep a screwd eye on the interested stocks and as well as the index.Online trading helps to have more transparent transactions and avoid harresment of repeated telecalling to the broker. It also help to track market better and make profitable deals
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