Prajna Capital - An Investment Guide

Where should I park my money? That’s a question many are asking wealth advisors today. Looking at the current market condition it is important to invest across asset classes. With the hardening of interest rates financial advisors say over the next 6 to 12 months income funds are a good option to consider. The income funds have generated a return ranging from 5% to 15% on a one-year basis. The returns have been divergent across the schemes depending on the interest rates view taken by the fund managers. How safe are debt funds Debt funds are less volatile and the risks are lower. However, there are some risks like interest rate risk and credit risk. While interest rate risk is a macro level trigger and cannot be controlled, credit risk can be controlled by prudent portfolio construction and active portfolio management. Fund managers’ say in the current scenario both income and gilt funds are becoming popular on expectations that the interest rate would be heading lower. However, nea...

Here I have tried to lists out some investment options that are relatively safer in volatile market conditions The stock markets are on a downward trend from the beginning of this year. Volatility in the markets is also quite high. There are many factors that contribute to negative market sentiments. For example, a persistent high inflation rate (especially the core inflation rate that is driven by basic commodities), rising commodity prices in global markets, anticipated slowdown in the global economy etc. Foreign investors were investing heavily in emerging markets. They are now taking out money, especially from emerging markets. Large foreign investors are bearish on global growth and expect the global economy to deteriorate. They believe that in the era of a global slowdown, emerging markets will under-perform their global peers. Foreign institutional investors ( FII ) have taken out around $5 billion from the domestic markets so far this year. Since the stock markets are ...