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- How to select a debt mutual fund?
- Health Insurance Cover by your employer – Do not depend only on it
- How to maximise trading profits?
| How to select a debt mutual fund? Posted: 11 Jul 2013 05:26 AM PDT Invest In Tax Saving Mutual Funds Online Call 0 94 8300 8300 (India)
Numerous factors affect the returns of debt funds. But should they be of concern to you
There are some questions that are very difficult to answer. And the ones mentioned above fall bang into that category. Yet, we cannot ignore them because an overwhelming number of reader queries to Value Research have taken on this tilt. Now we certainly understand why readers would want an answer. If you knew interest rates are going to inch upwards, you would put your money in short-term debt funds. Conversely, if they were going to head south, you would lock your money in long-term debt funds. Hence the question: where are interest rates headed?
There are way too many variables that go into determining the direction of interest rates -domestic and international. It is difficult for an experienced debt fund manager to make such a call, so one cannot expect a retail investor to even venture into that zone. If the days of easy predictability of bond prices and interest rates are over, how should an investor decide where to invest? Purely on the basis of his time frame and his preference for risk. Don't even try to guess where interest rates are headed, just look solely at your requirements and leave the rest to the fund manager's skill. Too much has been communicated to the investor on the interest-rate cycle. Investors must look at debt funds solely on the basis of their investment horizon and accordingly narrow down on the right.
Pointers to keep in mind when selecting a debt fund
First see if the fund manager's mandate is what suits you. You cannot have an investment horizon of 45 days and invest in a long-term debt fund.
Is the fund generating higher returns than its peers? Check the portfolio. It could well be that the fund manager is compromising on quality of paper to generate those extra returns.
In the debt market, on an average, the minimum lot size is around Rs 5 crore while the minimum ticket size in a primary issue could be Rs 50 crore. Hence a very small fund is at a distinct disadvantage. On the other hand, a large-sized fund may be in a position to strike better deals but if faced with huge redemptions, the market might not have adequate depth to bail it out. Avoid the two extremes.
Expenses have a significant impact on the relative performance of debt funds. It's important to see that your debt fund does not have the highest expense ratio while delivering just about average or below-average returns. The spread of returns, especially in big short-term fund categories, is very narrow. A small difference in return can significantly change the ranking. For example, among liquid funds, 1-year returns of around 59 of the 112 funds is stacked in a range of 0.50 per cent.
Happy Investing!! We can help. Call 0 94 8300 8300 (India) Leave your comment with mail ID and we will answer them OR You can write back to us at PrajnaCapital [at] Gmail [dot] Com
--------------------------------------------- Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.
Invest Tax Saving Mutual Funds Online Tax Saving Mutual Funds Online These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)
Download Tax Saving Mutual Fund Application Forms from all AMCs Download Tax Saving Mutual Fund Applications
These Application Forms can be used for buying regular mutual funds also
Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )
------------------ Best Performing Mutual Funds
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| Health Insurance Cover by your employer – Do not depend only on it Posted: 11 Jul 2013 04:08 AM PDT Invest In Tax Saving Mutual Funds Online Call 0 94 8300 8300 (India)
Most salaried are quite happy and content with their employers' health insurance schemes. Most feel they do not need any more insurance. But in the past three years, most Indian companies have been reducing the cover or insisting on co- payment for employees' parents. In such circumstances, employer's cover may not be enough. So, it is important the cover keeps pace with rising costs.
ICICI Lombard, says the amount of mediclaim by Indian companies since 2008 has shrunk or remained constant. The companies spend 90 per cent less on employee benefits and health care activities compared to West. These started cutting on insurance premiums after 2008, when the slowdown started. Hence, 20 to 25 per cent of employees take a top- up above the mediclaim.
More companies are cutting costs and introducing restrictions on covers. An ICICI Lombard report says 76 per cent of companies are adopting co- pay and room- rent limits. The average cover by employers is ₹ 1- 1.5 lakh.
Unfortunately, if you happen to be admitted for more than a week due to a serious ailment, your hospital bill is bound to shoot up and chances are low that your employee scheme will be able to take the burden. Hence, it's important you have a standalone health cover equivalent to your annual income. Also, a critical illness plan and a basic personal accident policy should be bought.
Since medical cover by employers is insufficient, it makes sense to have an individual health policy. It can be handy if the employer- provided group insurance limit gets exhausted or when you are in the midst of switching jobs. One should check the waiting period for pre- existing diseases ( PEDs), maternity benefits and the hospitals under the cashless facility.
Employee- provided insurance covers only hospitalisation.
Over and above your employee scheme, to buy a health cover of ₹ 5 lakh and critical illness and personal accident policy of ₹ 10 lakh each, a 30- year- old male will have to spend roughly ₹ 9,000 annually. Religare Care health cover costs ₹ 5,162 ( sum assured, or SA= ₹ 5 lakh). Bajaj Allianz sells critical illness cover at ₹ 3,000 ( SA= ₹ 10 lakh), whereas ICICI Lombard's personal accident policy is for ₹ 1,221 ( SA= ₹ 10 lakh).
However, insurance by companies is useful under certain conditions. It ( employer- provided group insurance) covers PED and maternity from the day policy is issued. Whereas, standalone health policies will have a waiting period of at least two to four years, depending on the insurer.
One can look at a top- up plan to raise cover. Some companies offer group top- ups, rare but useful. These can be bought by the same insurer who has offered you the employee scheme. Here the employee should check if the group top- up is in line with the employer- provided scheme. Whereas, individual top- ups are a bit expensive and one should check for base conditions before opting. Some insurers insist the top- up will not be issued unless the person has a ₹ X amount of health cover or some insurers put a condition that the top- up will not come into play unless the insured exhausts his base policy sum assured at one go.
Hence, make sure you buy an individual health cover when young so you get a policy at better premiums covering more illnesses.
Take a top- up or a standalone health cover; it will help you switch jobs and give larger coverage
Happy Investing!! We can help. Call 0 94 8300 8300 (India) Leave your comment with mail ID and we will answer them OR You can write back to us at PrajnaCapital [at] Gmail [dot] Com
--------------------------------------------- Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.
Invest Tax Saving Mutual Funds Online Tax Saving Mutual Funds Online These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)
Download Tax Saving Mutual Fund Application Forms from all AMCs Download Tax Saving Mutual Fund Applications
These Application Forms can be used for buying regular mutual funds also
Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )
------------------ Best Performing Mutual Funds
| ||||||||
| How to maximise trading profits? Posted: 10 Jul 2013 10:59 PM PDT Invest In Tax Saving Mutual Funds Online Call 0 94 8300 8300 (India)
Happy Investing!! We can help. Call 0 94 8300 8300 (India) Leave your comment with mail ID and we will answer them OR You can write back to us at PrajnaCapital [at] Gmail [dot] Com
--------------------------------------------- Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.
Invest Tax Saving Mutual Funds Online Tax Saving Mutual Funds Online These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)
Download Tax Saving Mutual Fund Application Forms from all AMCs Download Tax Saving Mutual Fund Applications
These Application Forms can be used for buying regular mutual funds also
Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )
------------------ Best Performing Mutual Funds
|
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