Understanding Volatility of Investment Returns with a Portfolio Rebalancing Simulator

Published on July 18, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 10 Comments

A long term investor should: recognise all the risks associated with the financial goal estimate the monthly investment needed (estimate not determine) understand the need for spreading the investment risk (asset allocation) understand the need for diversification within an asset class, choose investment vehicles wisely initiate investments as quickly as possible without worrying about perfection…

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Mutual Fund Calculators

Published on July 17, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 20 Comments

Here is a list of available mutual fund calculators and resources. (Updated Mar. 31st 2014) Flagship Calculator: Track your mutual fund and stock investments with this Google Sheet! Mutual Fund Calculators/Resources How to select mutual fund categories suitable for your financial goals? Step-by-step Guide to Choosing a Mutual Fund Mutual Fund SIP Returns Analyzer Mutual…

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Online RD Calculator

Published on July 13, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 2 Comments

Here is the online version of recurring deposit calculator on Microsoft’s Exel Web app. Thanks to reader Srinivas, I was able to correct a minor bug. I tried to convert it to Google Docs, but some cells showed incorrect values. This is quite disturbing because if one does not check each cell carefully then the…

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Real Estate Returns Calculator

Published on July 10, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 42 Comments

If you own a property and receive rental income from it, use this calculator to determine the return on your investment. If you like idea of using real estate for financial leverage, this is the perfect tool for you. Financial leverage is investing with borrowed capital. In the present context it refers to buying a…

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How Long Should I Maintain an Emergency Fund?

Published on July 8, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 18 Comments

This intriguing question was recently asked by my friend. Intriguing because it can be answered in two ways: In one word! Or by considering all possible ways an emergency fund would see some action! By action, I of course refer to emergencies only! American financial coach Dave Ramsey, often says, “Christmas is not an emergency!”…

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Calculator Update: Variable/flexible Recurring Deposit Calculator

Published on July 6, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 16 Comments

Note: The variable RD calculator gives the total post-tax interest. I have assumed that only the variable payments are subject to a penalty. That is if a variable payment is not made before a certain date (reader Srinivas says it is 10th in his case) then interest on the variable payment for that month will…

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The Permanent Portfolio: A Fascinating Low-Volatility Option For The Long Term Indian Investor?

Published on July 3, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 30 Comments

Worried about fluctuating stock market returns? Worried about sliding gold prices? Not sure how much to invest in equity or in gold? Here is an example of a portfolio based on an ingeniously simple notion that has proved to be remarkably stable irrespective of market conditions – stock/commodity/debt/currency markets! The Permanent Portfolio in an alternative…

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How do you manage your debt?

Published on July 1, 2013 / By M. Pattabiraman Twitter: @pattufreefincal

This is a guest post by Jaina Shah (Co – Founder and Director – Credexpert). Credexpert is a credit and debt counselling company and has a team of industry experts who handhold individuals through their credit life cycle. Follow these simple 5 steps and you will always have no debt stress or find yourself in…

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Understanding the Nature of Stock Market Returns

Published on June 27, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 50 Comments

Since we cannot change the way the stock market operates all we can do is to make sense of its returns and invest wisely.In this post I use Sensex data to understand the nature of its fluctuating returns (including dividends!). The Excel sheet attached which will be of interest and utility to all investors regardless…

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Comparing SIP Returns: Monthly vs. Daily vs. Quarterly SIPs

Published on June 24, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 13 Comments

How would you answer if someone asks you: “I know that a systematic investment plan (SIP) in a mutual fund is an effective way to accomplish financial goals, but how often should I invest? Each month? Each quarter? Or should I invest daily? Which option provides better returns?” There are two ways of answering this:…

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Fixed Deposit Calculator: Income Clubbing Headache

Published on June 20, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 12 Comments

It is a terrible idea to open a fixed deposit in your spouse’s name with your money. In general, this arrangement is a terrible idea with any taxable instrument. Terrible, because of the complex way in which the interest income will be taxed. Of course this is applicable only if you are a law abiding…

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Fixed Deposit Calculators

Published on June 19, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 19 Comments

These are the latest FD calculators: Download the FD calculator (suitable for FD durations in months and years) Update Oct 2013: Download the FD calculator (suitable for FD durations in months and years) with pre-tax and post-tax annualized yield for each month of investment. Download the FD calculator (suitable for FD durations in days) Download…

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Goal based Investing: 4-part series

Published on June 19, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 2 Comments

Part I: A Step-By-Step Guide to Long Term Goal-Based Investing Download the Step-by-Step Goal-Based Investing Calculator Macros need to be enabled. Macro used is derived from Excel Workbook A standard goal calculator is also included for comparison. Part II: The What, Why, How and When of Portfolio Rebalancing Rebalacing Simulator Lite: Suitable for investors unfamiliar…

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Download a do it yourself financial planning guide by Rajesh Dalmia

Published on June 17, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 7 Comments

Rajesh Dalmia a certified financial planner and director of Mandar Learning Academy has authored an impressive do it yourself financial planning guide for investors to understand the basic features of insurance planning and goal-based investing. The guide has four excellent calculation charts that enable one to calculate Necessary life insurance cover Corpus’s needed for retirement,…

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Interview with Raag Vamdatt: The Passionate Entrepreneur

Published on June 13, 2013 / By M. Pattabiraman Twitter: @pattufreefincal / 14 Comments

‘Conflict of interest’ is a concept poorly understood by most Indians: from the dislodged BCCI chairman for obvious reasons to a school teacher offering private tuition. Conflict of interest also looms large in the Indian financial advisory business. I would bet that more than 95% of financial advisors get remuneration of some sort from mutual…

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