Many of us have trouble understanding how the growth of volatile instruments like equity, bonds gold  or even real estate can be quantified. We come across many terms like  CAGR, IRR and XIRR in this context. In this post, the similarity and differences between the CAGR (compounded annualised growth rate) and the IRR (internal rate…

It is important to diversify a portfolio, but it is even more important to understand that diversification will typically lower portfolio return and not enhance it! Technically, diversification is for risk reduction,or to be precise  – reduce the daily ups and downs in the portfolio value (aka volatility). However, volatility reduction almost always results in return…

So, you have term insurance, health insurance, emergency fund, understand the need to beat inflation and have started investing towards that. Congratulations, you have reached the base camp! The summit still has to be climbed! Here are some ways to take money management to the next level. In the recently concluded Chennai investor discussion meet,…

Here are ten steps that could aid successful Investing. I strongly recommend going over these steps before considering any investment. “Give me six hours to chop down a tree and I will spend the first four sharpening the axe.” It is disputed whether Abraham Lincoln actually said those words. Nevertheless, it is a great quote. Too many investors…

This is a major update announcement to the guest post by Karthikeyan Chellappa. He has created a neat PPF calculator which can be used to 1) calculate maturity value for fixed, monthly, Quarterly, half-yearly or annual investment or 2) calculate fixed investment requires for a required maturity value. He was generous enough not to password protect…

A little too much is made of the importance of investing in PPF before the 5th of the month.  How important is this? What if I fail to invest before 5th for a few months? Should I beat myself up about it? Let us find out using the PPF tracker/calculator. Assumptions: Annual investment limit: Rs….

Here is a step-by-step to guide, plus calculator, to begin and track long-term goal based investing.  Most goal planning calculators tell you how much you should invest.  This sheets asks you, how much you can invest and goes about calculating the portfolio return. With that you can calculate the asset allocation required (equity to fixed income ratio)….

This post describes how one can calculate returns from stock investments including the declared dividends.  There is a lot of confusion about this calculation with regard to how the dividend should be treated. In this post, return refers to XIRR, that is the personal rate of return. See this for more details:  What is XIRR?…