Ten Questions Every Investor Should Answer

Here are ten questions that every investor should answer. I have inserted links to relevant posts for some questions.

If you are DIY investor or intend to be one, ask yourself these questions. If you have engaged a financial planner, ask these questions to the planner .

If  you have any suggestions that would help us all answer these questions better, I am all ears.

A suggestion: please copy these questions on a word processor and answer them. Include relevant links etc.

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Mis-buying is independent of Mis-selling

Every so often one hears the passionate refrain, ‘I have been conned into buying XYZ policy by my agent/adviser/relationship manger …., what should I do?, … how can we complain against such mis-selling?’

Do such people deserve our sympathy? Have they been mis-sold a policy or a product? Who is to blame? The buyer? The seller or the regulator?

First, some  reasonably clear distinctions.

Buying

The act or rather the science of making an informed decision. Understanding ones requirement, narrowing the category/class of product required and trying to choose one from it.

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Real Estate Investment Trusts (REITs): Unfit for Goal-based investing

A real estate investment trust (REIT) is like a mutual fund that invests in property. Here is why I think REITs are not suitable for goal-based investing.

I know very little about how REITs work and I have sourced my information primarily from three articles.

If you wish to understand,

  1.  how REITs work, check this illustrated article from the Economic Times: How can you buy property for Rs 2 lakh? REITs to help investors 
  2. why they will not work, read Subra’s post: Will REITs work in India?
  3. the nitty-gritty, read Deepak Shenoy at his brilliant best:  REITs: The New Way To Make Less Money Than Inflation, in Real Estate

I don’t claim to understand everything because I stopped trying when I learnt about two crucial aspects from Deepak and the ET article.

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Chennai Investor Meet Updates

Details of the investor meet planned at Chennai:

 Date: 1st Nov. 2014

Venue: CPR Convention Centre, Alwarpet, Chennai

Agenda:

My talk will cover  tenets of financial planning, goal-based investing, mutual fund analysis, basic of portfolio management etc.

The event will be partly sponsored by: Sundaram Mutual Fund

Registration Fee: Rs. 500 per participant. 

How to register: If you have already contacted me in this regard or expressed an interest to attend at the FaceBook Event page, no further action is needed on your part. I will keep you posted of developments over email.

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Debt Mutual Funds: Risk vs. Reward

Here is a risk vs. reward analysis of debt mutual funds. This is a companion post to:

All the posts are based on Value Research Online’s fund selector page.

First some definitions.

Average Maturity

A debt mutual fund holds debt securities with differing maturity periods. The weighted average of the maturity periods (taking into account percentage allocation) is known as the average maturity and is typically expressed in years. Higher the average maturity, the more sensitive the fund is to interest rate movements.

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