Prajna Capital - An Investment Guide

With the market closing in on its earlier peak, it's time investors looked at alternative assets to grow their portfolios    NORMALLY, you will hear phrases like 'book profits' , ' sit on cash' and so on when the stock market inches close to psychologically significant figures. However, this time around, if you pin back your ears, you may also hear someone whispering ' alternative assets' . It is not just the stock market which is close to breaking a historical high, other traditional assets like gold are also hovering around record highs. Things are fluid on the fixed income side as well. And, with interest rates hardening, it is not a great time for long-term investors in debt either.    With the markets touching new highs, we are asking investors to book some profits in equities and hold cash or build their alternative assets portfolio.   Alternative assets are non-traditional assets with potential economic value that is not found in a standard ...

Helping friends doesn't add to your wealth Money plays an important role in people's lives. Yet, when one has it, it is seldom given the importance it deserves. People look forward to earning more money rather than managing the money that they already have. This is probably why, money in bank accounts, is not deployed for an extended period of time. People don't realise they are missing an opportunity to earn profits on them. The money lies around till they hear about some good investment or insurance ideas from friends and family. Many of us have friends and relatives working in the financial services sectors, who approach us for business. More often than not, they get both attention and business from us. While putting one's money into any of the "amazing schemes" that one hears, most don't really care to understand what the scheme means, what the risks involved are, how the scheme works and so on. The reason for this carefree attitude is the blind ...

They are okay to start with, but can't be your core investment over time Clearly, these funds are for investors who want the upside of equities without taking much risk. Index funds provide security to the equity side in the portfolio, as it moves according to a broader index. But remember these are also equity funds. So, in case of sharp market downturns, these funds will also be affected. An index fund follows a passive strategy, instead of picking individual stocks. Their portfolio constitutes the same stocks, in the same ratio, as in the broader index. So, you know where is your money invested, without any nasty surprises. These funds employ a buy and sell strategy based on movement of the index and do not incur trading costs and analysts' fees. As a result, their annual fund management fee is 1-1.5 per cent, as against the 2.25 per cent charged by equity diversified funds. Templating the broader indices also helps diversify and lower volatility in comparison to sing...

   There are various factors affecting the eligibility for a home loan. Banks have their own parameters and criteria to determine the eligibility and quantum of housing loan. It helps borrower if they are aware of a few of such factors. Information furnished     To begin with, it is the information on the application form. The information submitted in the application form by the individual is verified from various primary and secondary sources. In case of wrong information or inconsistencies, the loan application is liable to be rejected. Financial strength     This is an important determinant. The loan eligibility as well as repayment capacity depends on the financial position of the borrower. The financial position of the borrower, his income level, net income, liabilities etc determine the amount of loan he is eligible for. One should have a minimum income level or a fixed and certain source of income. Credit history     The credit history of the borrower also plays an important...

This article explains how this process makes it easier for investors and obviates the need to block funds unnecessarily    Application supported by blocked amount ( ASBA ) is a new investor-friendly way to apply for initial public offerings ( IPOs ). ASBA is an interface for banks to participate in the process of IPO payments as proposed by the capital markets regulator, the Securities and Exchange Board of India ( SEBI ). The objective of introducing ASBA is to ensure an investor's funds leave his bank account only on allotment of shares in public issues.    The ASBA process also ensures that only the required amount of funds is debited to the investor's bank account on allotment of shares. In this mechanism, the need for refunds is completely obviated.    The banks participating in an IPO process can upload the bids with respect to their customers into the electronic books of BSE and NSE. The interface facilitates not only the controlling branch but also the designated ...

    L&T Infra's bond issue seems to be a suitable investment for those who have still not invested in infra bonds for tax saving. But others can give it a miss Issue details: Company Name: LTIF Issue Size: 200 cr Face Value: 1000/ Bond Issue Date: Oct 15-NOV 2 L&T Infrastructure Finance (LTIF) is coming out with an infrastructure bond to raise capital to fund its growth plans. The move comes on the back of LTIF being accorded the status of infrastructure finance company (IFC). While the issue terms are on similar lines to the earlier issue of IDFC, investors should consider investing only for the tax rebate attached to it. BACKGROUND: As per the current norms, IFCs can raise up to 25% of their gross disbursements in FY10 through bonds. While the company is not publicly listed, bonds would be tradable on the National Stock Exchange, post the lock-in period of five years.    While a portion of the proceeds might be used to meet the issue expenses, majority of it wil...

Corporate bonds are an attractive investment avenue for retail investors . They offer higher returns and can be traded for capital gains. Some infrastructure companies' bonds offer tax deduction under Section 80CCF. Many blue chip companies have either come or are likely to come in the market for issuing bonds. Companies and financial institutions raise funds needed for growth and expansion through bonds. In return, investors are paid interest and get back the principal amount on maturity. In the past, several companies such as Tata Capital, L&T Finance and Shriram Transport offered non-convertible debentures ( NCDs ). IFCI came out with an infrastructure bond in August. And now IDFC is offering infrastructure bonds too. All this has led to a growing interest in bonds. But there are some risks involved and one must know how to trade if the product suits his investment portfolio. BONDS Corporate bonds are usually issued with a face value of ` 1,000, ` 5,000, ` 10,000 or ...