Wednesday, January 4, 2012

Rupee Appreciation seems to be round the corner. Why / How /when


Factors which can lead the Rupee appreciation
·       Base rate effect to kick in  and the inflation numbers will go down and will be very much within the magic figure of 6
·        Reversal in interest rate cycle
·        Increase in corporate confidence & profitability
·       FII money flows into the country
·       Hike in NRI deposit rates will also help in money flowing into the country due to arbitrage opportunity
·       Allowing Qualified Foreign Investors (QFI) to invest directly will allow money to move into the country.
·       US economy showing sign of improvement to help local market sentiments. This will again be positive to move in money to India.
All these factors can lead the Rupee to appreciate and move away from 53 to below 50.

Factors which can hinder the Rupee appreciation 
·       Sovereign debt situation worsening in Europe.
      The best option today for NRI investors is to take advantage of the depreciated rupee and move into the country. For every dollar today they get more rupees and once in the country then can look at options of investing into equity at the present market level if your Profile allows else look at investing into debt funds especially on the Income fund side and easily you can look at a yield of 8-9%. 

Tuesday, January 3, 2012

QFI can now directly invest in the Indian stock markets. Views, Process, Advantage & Disadvantage

A QFI (Qualified Foreign Investor) is a KYC-compliant foreign investor who is a  resident in a country complaint with FATF ( financial action task force) standards, a signatory to the International Organisation of Securities Commission's multilateral memorandum of understanding. QFIs should not be resident in India or registered with Sebi as a foreign institutional investor or sub-account. 

This is a very good news for the markets as well as to the QFI. First advantage is a QFI doesn't have to worry about all the paper work & compliance in opening an account with an FII and then investing in the Indian market. Going forward a QFI will only need to open a DP account and a bank account and can use the advisor/broker to help in executing transactions. (More details on the process is still awaited). Secondly the limits on how much maximum amount a FII and a group of QFI can invest into a company has been increased to 10%. This is good as QFI's are mostly long term palyers unlike the FII and this will feed our market growth. Thirdly, a QFI will be allowed to invest into IPO's. There are discussions going on which states that they might even get voting rights, but details are awaited. 

The present FII outflow this year stands at Rs 2,700 crore which has also impacted the rupee and its believed that once the QFI's start investing the outflows as a percentage of total inflow will go down helping the market. 

This is one of the positive development in an other wise dull market, which reiterate the fact that investing in India for the long term today at the cheap valuations will add value to an investors long term portfolio. Keep Investing



Thursday, April 14, 2011

An important read for serious Investors :Why You Need an Investment Policy Statement #in

Hi
It’s very important for any investor to make an investment policy statement (IPS) before he starts serious investing. This statement is basically a gist of the all the important things one need to know and take care while investing. It not only covers ones analysis of need, goals etc, but is an important document which tells you what to and what not to expect when you are investing or are already invested.

IPS also encourages you to see all of your family’s investments as a single portfolio and also can rid you of the worry about how to invest that bonus check or ESOP money that just came in. It also aligns what you and you advisor expect from your investment portfolio.

Though you can make the IPS on your own, still I would say use any advisor like us for a detailed planning, aligning, understanding & tracking. It’s like when you are not keeping well, you can choose whether to go for self-medication or to pay small fees and use the services of a doctor.
Anyway the below article on IPS is a very good read don’t miss it.

Why You Need an Investment Policy Statement | MintLife Blog |

Monday, April 11, 2011

Periodic re-balancing of investments as per asset allocation adds value. #in

Genuine asset re-balance from the swelled portion (profit made) of the asset to debt periodically based on individuals risk profile adds value to the overall portfolio. Lot of people avoid doing re balance stating the requirement to pay short term capital gains or they would state a smaller return. Re-balancing should be the priority in the Investment Portfolio and if done periodically adds value to your portfolio.

I found this article pretty interesting. This will add value to our thinking and investments. Read on...

Rebalance investments to avoid bad times

Tuesday, April 5, 2011

The successful art funds seem to be in the photography field #in

Though it doesn't seems to have given the equity returns but yeah it does fit in the alternate investments profile. The Quillan Collection was sold at Sotheby’s for $8.9m. Interesting Read. click to read on.

Photography Funds Show Returns:

Friday, April 1, 2011

Investing in art, wine and other tangible assets #in

In terms of alternative assets art, wine and gold are most preferred. Investors need to understand these investment vehicles and select products very carefully.

Read on...

Investing in art, wine and other tangible assets


Wednesday, March 16, 2011

Time to get active in commodity companies


Investec had come up with a view to buy commodity shares in future as the profits of companies dealing in commodities, due to high prices will only be realized in future. I second this, I think we need to be in commodities fund especially of those companies investing in big mining companies worldwide. There is always a time lag / interaction between the commodity price movement and the stock price movement of similar commodity companies. This is the time, when ideally we need to buy in the stock. Lets see, will check and post in few days which fund can add value. Checkout the below link for more details. 

FUNDVIEW-Time to get active in commodities -Investec | Reuters