Fintellect

When you think about mutual funds, the first thing that generally comes to mind is equity and the stock market. What a lot of people don’t realize, is that’s only half the story. For the more cautious investors, there are mutual funds that invest exclusively in fixed-income securities, that unlike equity, carry a lot less risk and deliver much better returns when compared with general banking products. Mutual funds that invest in fixed-income securities are called debt funds and investments include corporate bonds, government securities, commercial paper (CP), certificates of deposit (CD), treasury bonds, and money-market instruments. Money-market instruments are funds that finance businesses for short periods of time in order to create a cash buffer to negate the gaps in payment cycles. These are great if you’re looking for a quick turnaround as investment options range from overnight to a year. So the obvious question here would be “why doesn’t everyone invest in debt funds instead o...

 People often associate risk with luck, and while that may be true to an extent, the major difference is that unlike luck, risk can be measured. Now before we get into the ratios that help us measure how much risk is attached to a particular mutual fund, an important concept to understand is volatility. Volatility is basically the measurement of how erratic a particular fund is, so if a particular fund is highly volatile, what this means is it has a tendency to either rise or fall sharply in a relatively short period of time. This is why volatile funds are generally considered high risk. Alpha With an Alpha ratio, instead of comparing a fund's performance to its own average like some other ratios, we’re comparing its risk-adjusted return with a benchmark (example Sensex, Nifty). This is why an alpha ratio can be either negative or positive, with a negative ratio indicating a fund that is underperforming in comparison with its benchmark. For example, an alpha ratio of +3 indicates a...

What a lot of people don’t realize, is that there’s a lot more to mutual funds than the fact that they’re subject to market risk, and offer documents should be read carefully before investing. While people who have a lot of money to invest can afford professional “money-managers” and diversified portfolios, mutual funds give the common man access to such professional money managing services. Think of it as a common fund or pool of money, where the public contributes and the collective amount is then invested by experts, according to the investment objective of the fund. The different types of mutual funds are: Equity funds - funds that invest in stocks  Debt funds - funds that invest in fixed income instruments Money market funds - funds that invest in short-term money market instruments Hybrid funds - funds that divide investments between equity and debt to create a balanced or diversified portfolio. In this post, we’re going to take a closer look at Equity funds, in particular, a...

 General 1. First digital Budget in the history of India 2. Vehicle Scrapping Policy. Vehicle Fitness Test after 20 years in case of Personal vehicle and 15 years in case of commercial vehicles 3. 64,180 crores allocated for New Health Schemes 4. 35,000 crores allocated for Covid Vaccine 5. 7 Mega Textile Investment parks will be launched in 3 years 6. 5.54 lakh crore provided for Capital Expenditure 7. 1.18 lakh crore for Ministry of Roads 8. 1.10 lakh crore allocated to Railways 9. Proposal to amend Insurance Act. Proposal to increase FDI from 49% to 74 %.  10. Deposit Insurance cover (DICGC Act 1961 to be amended). Easy and time bound access of deposits to help depositors of stress banks. 11. Proposal to revive definition of ‘Small Companies’ under Companies Act 2013. Capital  less than 2 Cr. and Turnover Less than 20 Cr. 12. Disinvestment: IPO of LIC, Announced Disinvestment of Companies will be completed in FY 2021-22 Direct and Indirect tax 1. Senior Citizens: Reduc...