Author: Shalini Bhardwaj

A Demat account and a trading account are essential yet distinct tools for stock market investors. The Demat account acts as a digital storage for securities like shares, bonds, and mutual funds, ensuring safe and convenient ownership. On the other hand, the trading account enables the buying and selling of these securities in the stock market. While a trading account is required for transactions, the Demat account reflects the credited or debited securities. For activities like IPO applications or intraday trading, these accounts serve different purposes but often work together to streamline the investment and trading experience for users.  What…

An NRI (Non-Resident Indian) is an Indian citizen who resides outside India for a major part of the financial year. According to Indian regulations, any Indian citizen who stays in India for less than 182 days in a financial year qualifies as an NRI. Can NRIs Invest in Mutual Funds in India? Yes, NRIs can invest in Indian mutual funds. However, the process and rules are guided by the Foreign Exchange Management Act (FEMA). FEMA outlines the norms for investments by NRIs in India to ensure that funds are managed within legal boundaries. Rules and Conditions for NRI Mutual Fund…

Mutual funds have gained immense popularity as a convenient investment option. For those hesitant about the stock market’s volatility, mutual funds offer a safer and managed way to grow wealth. However, stepping into the world of mutual funds without adequate knowledge can lead to regrets. To make informed decisions, here are five crucial tips every investor should keep in mind: 1. Identify Your Financial Goals and Risk Capacity The first and most important step before investing is to clearly outline your financial goals. Ask yourself these questions: If your goal is long-term, such as retirement planning, you might opt for…

In the ever-changing stock market, the term “cheap” often misleads investors. A stock with a low price doesn’t necessarily mean it’s a bargain. Similarly, a high-priced stock isn’t always expensive. Understanding this nuance is crucial for making informed investment decisions. Why Low Price Doesn’t Mean Cheap Stock prices alone do not define their worth. Let’s break down why low-priced stocks might not always be a good deal: Valuation Matters More Than Price The value of a stock should be assessed based on its valuation metrics rather than its face value. Here are key ratios to consider: Price-to-Earnings (P/E) Ratio This…

Redeeming a mutual fund investment isn’t a decision to make in haste. Whether you’re planning to cash out for a specific goal or reacting to market changes, several factors should guide your decision. Carefully analyzing these aspects ensures you maximize the benefits of your investment while avoiding unnecessary penalties or losses. Evaluate If You’ve Achieved Your Financial Goal One of the primary reasons to redeem mutual fund investments is reaching a financial milestone. Mutual funds are often linked to specific objectives like creating an emergency fund, buying a house, funding a child’s education, or building a retirement corpus. Before initiating…

Investing in mutual funds has become one of the most popular ways to grow wealth. However, like any investment, it carries risks. Understanding these risks is crucial to making informed decisions and achieving your financial goals. Many factors contribute to mutual fund risk, from market fluctuations to economic conditions. Let’s explore how you can measure these risks effectively. Key Metrics to Measure Mutual Fund Risks Mutual fund risks are influenced by factors such as economic changes, interest rate fluctuations, geopolitical events, and even company-specific developments. Fortunately, there are metrics to assess and compare these risks. Here’s a breakdown of the…

Equity mutual funds are popular among investors for their potential to generate long-term wealth. Two commonly discussed types in this category are Flexi Cap Funds and Focused Funds. While both offer avenues for capital growth, they differ significantly in strategy, portfolio composition, and risk factors. If you’re planning to invest, understanding these funds’ characteristics can help you decide which one is better for your financial goals. Similarities Between Flexi Cap Funds and Focused Funds Equity-Driven Investments Both Flexi Cap Funds and Focused Funds are mandated to invest at least 65% of their assets in equities or equity-related instruments. This ensures…

In recent years, more people have shifted from traditional savings methods like fixed deposits (FDs) to smarter investment options like mutual funds. Mutual funds offer a balanced approach to earning higher returns while minimizing risks compared to the stock market. Here’s a simple guide on how to invest in mutual funds and make the most of your money. Why Choose Mutual Funds Over Other Investments? Mutual funds allow you to pool your money with other investors and have it managed by professionals. This reduces the risk for individual investors and increases the chances of higher returns. Whether you’re planning for…

Paying income tax is a responsibility of every taxpayer earning above a certain limit. While most people are aware of income tax filing, many remain confused about terms like advance tax and self-assessment tax. These are critical components of tax payment under Indian laws and must be understood clearly to avoid penalties and ensure smooth compliance. Here’s a detailed look at these two taxes, their differences, and how to calculate them. What is Advance Tax? Advance tax is a tax payment made during the financial year on the income you earn within that year. Instead of paying your entire tax…

Small cap funds are mutual funds that primarily invest in stocks of smaller companies with high growth potential. These companies are ranked beyond the top 250 firms in terms of market capitalization, making them a high-risk, high-reward investment choice. While these funds can deliver significant returns during bullish markets, they are also prone to steep declines during market corrections. Why Small Cap Funds Have Declined Recently The Indian stock market witnessed a sharp downturn in October 2024, and small cap funds were hit the hardest, with an average drop of 7%. Compared to large cap and mid cap funds, which…