Prajna Capital - An Investment Guide

An issue of shares made by a company free of charge to existing shareholders. Also called bonus issue. An issue of free shares distributed pro rata to existing stockholders instead of a dividend. An offer of free additional shares to existing shareholders, a company may decide to distribute further shares as an alternative to increasing the dividend payout. Also known as a " scrip issue " or " capitalization issue ". New shares are issued to shareholders in proportion to their holdings. For example, the company may give one bonus share for every five shares held. Ideally, the share price drops the same ratio of bonus issued. For instance, if the company is giving one new share for each four shares own by the shareholders, the share price will drop by 20%. In fact bonus issue is nothing but a split … however accounting is done on different perspective.

It is easier to ensure a steady income stream through your retirement years if you plan early Some things are hard to predict and planning for post-retirement is surely one of them. The task is more challenging in the current scenario with the growing uncertainties. You are not sure whether you will drag on till 58 or 60 in your current job and the uncertainty could even come from you if you decide to hang up your boots for entrepreneurship in your mid-40s. However, this is for those who are planning to have a long innings in their current job and have a few decades on hand to plan for retirement. Here's how you can plan for a comfortable retirement: List out expenses Before you set out to plan for your life after retirement, check out your expenses. Some of those expenses may not be visible at present but could prove to be a key factor at a later stage. A classic example of this is medical expenditure. As you are aware, medical insurance too does not take care of medical e...

When choices are many you could end up feeling confused; it could be over buying a cell phone or for that matter an ice-cream flavour! So imagine, when your mutual fund ( MF ) agent throws an array of questions -- Which fund do you want to invest in? or Which MF option do you want? Chances are you might end up feeling confused. A MF offers three options-- dividend payout , dividend reinvestment and growth . Each of this option has its own pros and cons. We at Wealth tip you off on what's best for you. Let's understand the three options in detail. A. Dividend payout: Assuming you have 100 units in your MF and the net asset value ( NAV ) of the unit is Rs 10. Now, the fund house declares 50 per cent dividend (a dividend is the profit made by a MF that it distributes to its unit holders. These dividends are paid in cash and are a percentage of the unit value) on the scheme. So, for every unit you will get Rs 5 (50% of Rs 10), which makes it Rs 500 for 100 units. You might rejoi...