Prajna Capital - An Investment Guide

Inflation , is an economic concept. If you really thing about it, inflation makes the worth of money reduce. the prices of everything goes up over time and this phenomenon is called inflation. The question is: By how much do the prices go up? At what rate do the prices do up? The rate at which the prices of everything go up is called the " rate of inflation ". My family's monthly expense is Rs 50,000. At an inflation rate of 5 per cent, how much will I need 20 years hence with the same expenses? The required amount can be calculated using the standard future value formula. Inflation means that over a period of time, you need more money to fund the same expense. Formula : Required amt.=Present amt. *(1+inflation) ^no. of years Type in: =50000*(1+5% or .05)^20 and hit enter. You will get Rs 1,32,664 as the answer, which is the required amount. Also used for: Calculating maturity value on an investment.

It is advisable to start investing early in life towards a retirement plan. Here are some tips: Retirement planning should be an essential element of everyone's financial planning. Individuals should start planning for their retirement funds as early as possible in their life. If we look at the way our society is shaping (increase in average lifespan, nuclear families etc), it becomes even more important to plan carefully so that you are totally independent in your golden years. Planning for retirement is a comprehensive process for determining how much money you will need at the time of retirement. Some people feel that retirement planning is important when you cross 40 years of age. It then becomes difficult to build a good corpus within the next few years and eventually these people end up investing in risky investment instruments. They invest their hard-earned money in risky stocks, where the returns are generally not certain. There are many insurance instruments available in...

How you can invest in stock markets outside India and some risks involved Indian citizens had the ability to invest abroad as early as 2003. Investments in mutual funds up to $25,000 in a calendar year were allowed. Since then, the Reserve Bank of India (RBI) has raised the limit to $2,00,000. This has opened up many investment categories for Indian investors. You can invest in stocks, mutual funds, foreign currencies, real estate and insurance policies anywhere in the globe. You could also invest this amount in hedge funds, currencies and currency derivatives. So, the global markets, with its glittering array of financial products, are now just a click away. Why invest abroad? For some of you would are interested in equities, there are thousands of shares listed in global equity markets to choose from. But first and foremost, you must be clear on why you want invest abroad. There are many good reasons for investing in equities abroad. For example, as a risk-averse investor, you may si...

It’s more than just the money. For many emerging companies, Private Equity investors provide invaluable advice and the right perspective, when it matters most ARBURG PINCUS’ dalliance with Bharti Tele-Ventures from 1999 to 2005 is still remembered as one of corporate India’s most famous relationships. When it ended, the international private equity giant walked away with a cool 450% return on its investment. Bharti, too, has grown since then in leaps and bounds to become India’s largest mobile network service provider. However, the saga continues to live on and many consider the deal to be India’s first truly fruitful partnership between a corporation and a private investor. Not because of the sheer volume of money the former injected into the latter back then, but also because Warburg set a new precedent in taking a company with great potential and hand-holding it all the way to success. This deal and others like it (such as Pantaloons’ transformation assisted by ICICI Venture) helped...

MANY of us like to believe that we have a robust financial portfolio that would take care of our future. Interestingly, the plan would work only if funding the plan is regular. What happens if the funding suddenly stops? When it comes to investing in insurance, many of us mistreat it as a pure tax-saving tool. With the advent of ULIP and many innovative products in the market, thanks to privatisation of the industry, insurance is also being looked at as an ‘investment’ option that is expected to pay dividends/ returns, along with securing one’s future. Irrespective of our motivation to buy insurance, we often grope in the dark to determine the right approach for buying insurance products and assessing if we have an adequate insurance cover. NEED-BASED APPROACH Life insurance has moved from protecting life to protecting lifestyle . Today, there is a choice of innovative products that meet financial needs at each of one’s life stages — be it marriage when one assumes responsibility to pr...

Inflation , is an economic concept. What the cause of inflation is, is not important to us from the point of view of this article. What is important to us is the effect of inflation! The effect of inflation is the prices of everything going up over the years. A movie ticket was for a few paise in my dad’s time. Now it is worth Rs.50. My dads first salary for the month was Rs.400 and over he years it has now become Rs.75,000. This is what inflation is, the price of everything goes up. Because the price goes up, the salaries go up. If you really thing about it, inflation makes the worth of money reduce. What you could buy in my dad’s time for Rs.10, now a days you will not be able to buy for Rs.400 also. The worth of money has reduced! If this is still not clear consider this, when my father was a kid, he used to get 50paise pocket money. He used to use this money to go and watch a movie (At that time you could watch a movie for 50paise!) Now, just for the sake of understanding assume th...

Goldman Sachs Asset Management L.P. ( GSAM ), has received regulatory approval from the Securities and Exchange Board of India (SEBI) to start a wholly-owned asset management and mutual fund business in India. The senior management team appointed to spearhead the asset management operations of Goldman Sachs Asset Management in India is led by Mr. Adam Broder as Chief Executive Officer and Mr. Prashant Khemka as Chief Investment Officer. Mr. Khemka said, “It is our goal to emerge as a world class asset manager in India, by drawing synergies from our global expertise and combining them with our proven risk management techniques to deliver strong and consistent results for our investing clients. India is amongst the fastest growing economies in the world, with a robust and growing savings and investment pool.” Added Mr. Broder, “We are delighted to have received the Mutual Fund approval from SEBI so promptly. India is one of the most important countries to our Asian business and we have a...