If you have started investing in equity mutual funds and/or stocks in the last few years and if your financial needs are far, far away, this is the best time to invest in equity.  You don’t need to be an expert or genius to recognise that the markets are going to move up and down…

In this post, I discuss the difference between risk and volatility. Distinguishing the two can lead to better money management. Please do not expect the usual sales guys argument that volatility is good and everything will turn out okay in the long term.  So let us start with the basics. This post is part of Resolve –…

In June 2013, Rajesh Dalmia a certified financial planner and director of Mandar Learning Academy authored an impressive do it yourself financial planning guide for investors to understand the basic features of insurance planning and goal-based investing. He readily agreed to shares his work here. I think it is time that a new generation of…

At some point, after you started investing in mutual funds or stocks, you might have heard the words “annualized returns” or “CAGR” or “XIRR”. If you are interested to know what these mean, how they are calculated and how to interpret them, read on. But first, do check out My Handpicked Mutual Funds September 2018 (PlumbLine)….

Each time the markets move up for a few sessions, it makes many investors uncomfortable. Is it a bubble? Is it euphoria? They wonder and if the movement results in an all-time time, the worry machines are turning in full swing. In this post, I discuss some reasons for this investor behaviour and how one…

“I started investing Late, Can I Catch Up?” I am often asked this question. The catching up here refers to being able to create an adequate retirement corpus. The answer depends on the age of the person. For someone in the 30s (even late 30s), I think it is quite possible if they put their head down…

One of my favourite quotes about goals is by Harvey Mackay: “A dream is just a dream. A goal is a dream with a plan and a deadline.” That just about sums it up!! In this post, let us look at how to define a financial goal with the Audi as a dream car. It…

Diversification is a word that many investors use rather loosely. Whenever they seem something “offer good returns” I have seen many investors want a piece of that action and say “I have added it for diversification”. Again that classic mistake. Choosing a product/security/asset class by looking at its (recent) returns and not its risk. People who…

In about nine months, India will be voting to choose its 15th prime minister in the Lok Sabha Elections 2019. It is well known that in the build-up to every general election and immediately afterwards, the market is filled with excessive fear and hope resulting in swings that can unsettle the nerves. So is there…

Portfolio rebalancing refers to resetting your asset allocation (equity: fixed income ratio) from time to time – typically once a year – to lower risk in your portfolio. In this post, I show backtesting results and discuss exactly how much is the risk reduction and in spite of tax and exit loads, it is totally…

A few days ago, I gave a talk at a CFA Society meeting. One of the modules is covered in this post: How much equity should I hold in my portfolio? We know that equity has the potential offer better returns than fixed income (emphasis on potential) but how much equity – either as direct equity…

We all invest with the hope of having enough money for our future needs. This is true for even those who claim they do not have a goal – they just don’t know it yet. A good amount of equity exposure is important to beat inflation for long-term (10Y+) goals. However, many people make the…