All you need to retire is a LEnS
A question many ponder is “what is the amount I need to retire?” Retirement may not mean one is not working at all, it could be that the work may not generate income for the individual. Couple of prerequisites for “retirement” are To have come to an equilibrium with one life style and not having […]
3 “S”ins to avoid while saving for your kids college
Parents and prospective parents intuitively understand the importance of college education and are keen to ensure that they have enough funds to support their kids through college. Common challenges in planning for college are Starting too late Saving too little Selecting inappropriate products Starting too late: Saving for college becomes a must once the child is born. […]
Don’t put all your eggs in at the same time….
Most of us intuitively understand the concept and benefits of having a diversified portfolio – as we have heard “don’t put all the eggs in the same basket” umpteen times, if not more. Temporal diversification is less well understood. Temporal diversification is building up assets in a particular asset category over a period of time. […]
Instincts, Intellect, and Investing …….
Behavioural economics gives us excellent insights to leverage our instincts and intellect for investing. Let’s consider three emotional situations of Stress, Panic, and Greed. Stress: Lets say Sachin Tendulkar is coming to bat when he has failed to get runs in the last few games. It is only natural that he is thinking about his […]
2014 – The year that was….
As we say good bye to 2014, we can say that it was one of the better years for the market in general. NIFTY has gone from 6300 to 8200, a 27% increase. If one were investing in NIFTY on a monthly basis, one would have realized a return of 14%. This has been a […]
Wealth creation is value creation
Wealth creation has always been about value creation through innovation and invention. The richest people in the world today, Bill Gates, Warren Buffett, Carlos Slim, Larry Ellison, Koch family etc., have created value by building businesses. Wealth creation happens by deploying capital to create value. Capital could be any asset like cash, land, an idea […]
It’s all relative
Sensex is at 28,500 is it too high? Gold is at 2,700 can I buy at this price? These questions are looking at just one number and trying to determine if it is reasonable. This is almost like looking at a cab fare and not considering the distance you want to travel. Sensex is a measure of […]
Three P’s of investing
Philosophy: Investing philosophy is the set of underlying beliefs that will drive the investment approach. For instance – Value investors will invest only when the valuations are reasonable, contrarian investors will do the opposite of the crowd, technical investors will invest based on the charts, Black swan investors will take bets on extreme events and […]
Your investments in the east will go north
A case for NRI’s to invest in India: If NRI’s were looking for 2 reasons to invest in Indian markets those would be: Growth story – US market (S&P 500) had an historical return of about 10%. Indian markets have returned over 15% for the last 35 years. With significant opportunity for deployment of capital and […]
Interest in Retirement
Many would like to evaluate their retirement options, plans for retirement are usually based on building a corpus that when invested in a bank deposit can reasonably sustain their life style and take care of inflation. This is a good plan but for a key challenge – the amount needed is significant as the interest rates […]
Counting small things and making small things count
Making good financial decisions is not all about big decisions, it is also about the small decisions that have a significant impact. I had a term life policy which I had bought about 9 years ago. The prices of term life insurance have fallen drastically since that time and now I could buy the same […]
Predictably irrational….
Our bias: We believe that more people die in cyclones or earthquakes as opposed to malaria. We remember extraordinary events, hence we feel that they have a greater impact. Economic impact of our bias: Markets crashes, losses, and frauds get a lot more air time – hence there is a prevalent misconception about business. We […]