Investment in Silver

 

The citizens of the previously known “Golden Bird”, India, always believed in gold and depended on it in difficult times. Gold has found a very auspicious and elevated place in Indians’ psyche. This is the foremost reason why Gold prices usually go up in India. As per recent estimates, India and China are two highest Gold consuming countries in the world. Traditionally,Gold has been an investment asset and a reliable hedge against inflation. Adding Gold to one’s portfolio provides stability in returns that equities and mutual funds do not.

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Systematic Investment Plan

Investors can buy financial assets for the purpose of investment in two ways. They can pay lump sum amount and buy once. In this case, any adverse impact on the value of asset will reduce the investment returns. The other option is to invest a sum periodically. In this case, adverse impacts will not hurt drastically. The periodic investment option is also known as SIP. SIP or systematic investment plan is a scheme where investors can invest a certain amount every period (daily, weekly, monthly, quarterly, or yearly) in a financial asset up to the investment horizon.

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Fixed return investment options

 

Fixed rate schemes have regained its charm in last 2 years owing to a volatile stock market and dwindling growth numbers. Fixed rate provides safety of capital as well as returns. This is relatively safer investment than stocks and equity oriented mutual funds. For most of investors, fixed rate scheme means fixed deposits in banks and Government schemes. While banks and Government schemes are almost risk free, there are others which may expose investors to little risk but provide a better return. No scheme is better than the other. Investment always works on risk reward concept.

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How to analyze Banking Stocks

Skyrocketing interest rates, rising NPAs, and high deposit rates have beaten down banking sector as a whole. The Bankex, (the index covering all banking stocks) is lowest in last 18 months. The exchange traded fund, Goldman Sachs Banking Index Exchange Traded Scheme, which tracks banking sector is down to close to 20% in last 1 year. The performance of PSU sector banks is even worse. They have been down by 30% in last 1 year. Could this be the right time to enter into banking stocks? The current valuation certainly looks attractive from long term perspective. However, RBI has not shown any indication that it will stop raising the policy rates.

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Understanding Risk and Reward

How many times we have seen our investment gains going up and giving us a pleasant surprise. We take it in our stride. Some of us take it as our excellent stock picking abilities while some are more humble and think this is all because of market as a rising tide raises all boats. Similarly, how many times we have seen a stock that has gained enormously in last couple of months has started downward slide for no apparent reason. This is the most frustrating experience. Again some of us blame the market while some are more humble and learn from the experience.

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Understanding Reverse Mortgage

Reverse mortgage is a great scheme for senior citizens. This involves mortgaging your properties in lieu of a monthly payment. The monthly payment can be used for meeting the expenses. Investors can also choose to get a lump sum amount subjected to some condition. This is a new scheme in India but has been very popular financial instruments in the west since many years. Reverse mortgage market is also much matured in west which enables senior citizens get sufficient cash flow to spend on their expenses when they cannot earn any more.

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