Where should I make investments?

[pradeep200417]

It would be more than 900, compounded on a quarterly basis it is around 931. If you want to a calculation check this:
http://www.allbankingsolutions.com/fdcal.htm

In FD, say the interest in 9%, is it quarterly or yearly, in the sense, do they calculate the interest per quarter at the rate of 9%/annum(actually 390 days?) and then compound it,
sort of compound interest at the end of FD term ?

Assume i invest 10,000 Rs in FD at 9% per annum (390 days ?) so no counting the tax and all, would i get 10,900 Rs at the end of term ? Or more because of compound interest ?

Hey i again have a doubt.
There are two types of FD right.
One where you can take the interest after it is accrued quarterly and it is called the "Traditional FD".
The other one which is called "Cumulative FD" Here after every quarter, the interest gets added to the principle amount and then interest is calculated on that further.

So correct me if i am wrong, but if we invest 10000 in the Traditional FD for like 1 year we get 10900.
But for a Cumulative FD we would get say 10970.

 

[sharktale1212]

Hey i again have a doubt.
There are two types of FD right.
One where you can take the interest after it is accrued quarterly and it is called the "Traditional FD".
The other one which is called "Cumulative FD" Here after every quarter, the interest gets added to the principle amount and then interest is calculated on that further.

So correct me if i am wrong, but if we invest 10000 in the Traditional FD for like 1 year we get 10900.
But for a Cumulative FD we would get say 10970.

Correct. If interest is being paid to you there is no cumulative payout being done - instead a quarterly payout. I think @raksrules is talking about the cumulative FD.

 

[Vince]

Books - Reminiscene of a Stock Operator by Jesse Livingston. Its a handbook for most Wall Street traders. Though it is geared towards actual "traders" it gives you understanding on how the market works. IMO one of the reasons people fail.

Just finished reading this recently. A good first half, followed by a meandering, boring second.
The only major ability he had was to "read the tape". The only other thing he did was to learn from his experience.
In today's terms that would mean, "do your research", and learn from your experiences.

 

[madhukannan]

Sharing some of my experiences
ULIPS --- A BIG NO ----invested around 50K in Bajaj allianz five years back and the valuation two months back was 30 K and they charged 5 K as processing fee for surrendering the policy . so 50% loss in five years.
STOCK --- A Small NO.. If you don't know the market , I read a lot about fundamentals .. lots of ratios etc etc and invested around 1 lakh in market for two years , and it showed appreciation about 15 to 20% for three years and now its shows a depreciation around 30% . Market is not consistant , I don't think there's any invest it and forget it company ,you have to constantly monitor the market .
Gold -- YES which has given good returns but i don't know how good it is in current scenario

right now i am investing in FD and PPF I don't want to risk the hard earned money ,
i would suggest FDs , PPF and if you have a good some to invest at a time go for some Real Estate investment that gives the best appreciation ,

 

[honest1]

It would have been better, if you invested in a mix of Mutual Fund schemes according to your risk appetite and goal.

 

[John4321]

By quarter I assumed if I invested Rs 100000 for 3 months then how much would I get in return. Where should I invest to make atleast 10% returns in every quarter (every 3 months) so that by the end of the year if I calculate 10% every time, then that means I get 40% in 12 months thats what I am talking about.

Name it guys how to earn smart money. I got no knowledge of stocks or mutual funds but would like to read and learn from you if you are getting 10% every 3 months from that kinda stuff.

 

[raksrules]

@John4321

Quarter interest does not mean you get 10% every quarter, because by that you would get 40% in a year and no investment gives that much (none that i know of).
It is something else i cannot explain since i don't have proper words to do so. May be someone else can throw more light on that.
But with 1 Lakh investment you can expect like 1.1L types in return at the end of a year (may be less).

 

[edge111hussain]

Quartely interest on cumulative basis means say rate of return is 10% quartely, then on 100 u make 10% divided by the time period.
But generally the quarterly rates are lower than annually or 3yr rates. So if you want to be invested for a yr, it makes sense to invest on a yearly rate. Also in general investing in an FD doesnt make any sense cause of taxation. Yes if you need liquidity, fd is the way to go, even for OD facilities, but a debt lockin product makes more sense. The ones to look out for are company issued fd's, like tcs, l&T and tata ones. Their annual rate is around 10.5 and 3 yearly at times is as high as 12.36. Taxation is lesser than fd.

Somebody above mentioned that gold is a smart investment, ummmmm, not anymore...

 

[raksrules]

What is this company issued FD ? Separate from Bank FD ?
Also like in FD, we can break it to get the money anytime, we cannot do that for the company issued FD ?

 

[edge111hussain]

What is this company issued FD ? Separate from Bank FD ?
Also like in FD, we can break it to get the money anytime, we cannot do that for the company issued FD ?

Companies raise money off different avenues. since 2009, based on ones books of accounts, companies can raise money via issuing fd's. Tata, mahindra, tcs and l&t are the most common and the safest with highest ratings. Sundaram etc also do it and give higher returns too, but i prefer to go safe on these.
These aint over the counter products and generally come with a ticket size, i.e minimum investment amt typically of 25k, 50k in multiples. Typically trading desks deal in such products but you can directly get them from says a cams or Darashaw.
No, like normal fd's, these cannot be broken at anytime. Hence you get a higer rate of return cause the float of the issued fd does not move.

 

[sharktale1212]

Just finished reading this recently. A good first half, followed by a meandering, boring second.
The only major ability he had was to "read the tape". The only other thing he did was to learn from his experience.
In today's terms that would mean, "do your research", and learn from your experiences.

There are many more lessons on market liquidity, price discovery etc. As I said you need to be a trader to fully appreciate the information contained An amazing read nonetheless.




BTW, isn't company FD same as bonds. A fancy name to lure in people who want to invest in FDs (not implying in anyway that investing in company bonds or company FD is bad )

 

[pradeep200417]

By quarter I assumed if I invested Rs 100000 for 3 months then how much would I get in return. Where should I invest to make atleast 10% returns in every quarter (every 3 months) so that by the end of the year if I calculate 10% every time, then that means I get 40% in 12 months thats what I am talking about.

Name it guys how to earn smart money. I got no knowledge of stocks or mutual funds but would like to read and learn from you if you are getting 10% every 3 months from that kinda stuff.

May be you should look at gambling

 

[edge111hussain]

There are many more lessons on market liquidity, price discovery etc. As I said you need to be a trader to fully appreciate the information contained An amazing read nonetheless.




BTW, isn't company FD same as bonds. A fancy name to lure in people who want to invest in FDs (not implying in anyway that investing in company bonds or company FD is bad )

The invested instruments are different. Bonds have higher rated instruments and higher investment periods. Not the case with fd's.

 

[John4321]

Companies raise money off different avenues. since 2009, based on ones books of accounts, companies can raise money via issuing fd's. Tata, mahindra, tcs and l&t are the most common and the safest with highest ratings. Sundaram etc also do it and give higher returns too, but i prefer to go safe on these.
These aint over the counter products and generally come with a ticket size, i.e minimum investment amt typically of 25k, 50k in multiples. Typically trading desks deal in such products but you can directly get them from says a cams or Darashaw.
No, like normal fd's, these cannot be broken at anytime. Hence you get a higer rate of return cause the float of the issued fd does not move.

Bro currently are you investing in any such kinda schemes? If yes then let me know which 1s?. Have you also invested in the past? If yes then how much profit have you got till now from these. Just if you could let me know approximate amount.

 

[edge111hussain]

Bro currently are you investing in any such kinda schemes? If yes then let me know which 1s?. Have you also invested in the past? If yes then how much profit have you got till now from these. Just if you could let me know approximate amount.

Approximate? no u get to know the exact amount, its upfront disclosed before you invest and u get a paper like a share certificate mentioning the same.
I have and am invested in these. The highest roi i have received is 12.85 for 3 yrs compounded and 10.75 for a yr. Which means for the 12.85 on every lac invested, i received 1,43,716 at the end of 3 yrs.

 

[John4321]

Approximate? no u get to know the exact amount, its upfront disclosed before you invest and u get a paper like a share certificate mentioning the same.
I have and am invested in these. The highest roi i have received is 12.85 for 3 yrs compounded and 10.75 for a yr. Which means for the 12.85 on every lac invested, i received 1,43,716 at the end of 3 yrs.

So which are such schemes present now currently in which I can invest a lakh for 3 yrs and get the same as u got or I can get even more then that. Also are these tax free or do I have to pay tax on it. Are you talking about this http://www.sundaramfinance.in/products/deposits/shfdepositrates.aspx

Also I would suggest you to have a look at this and let me know whether it is good to invest or not for a year http://www.bharatbank.com/int_deposit.htm

 

[thilak.kmb]

Please do not invest in MFs and ULIPs. These are straight frauds on the public. I wonder how the govt is allowing such schemes. The beauty of the thing is every Insurer including LIC is having many such schemes. Innocent people are intentionally dragged into such schemes on false promises.

 

[babhishek]

Please do not invest in MFs and ULIPs. These are straight frauds on the public. I wonder how the govt is allowing such schemes. The beauty of the thing is every Insurer including LIC is having many such schemes. Innocent people are intentionally dragged into such schemes on false promises.

like, duhh! *** read the offer document carefully ***

stop blaming the government for everything, do your homework understand your requirements and risk appetite. research historical data, performance of the instrument of your investment.

 

[MAGNeT]

Company fixed deposits::Similar to Bank fixed deposits.But here the company like say HDFC ,Mahindra,etc takes money for a period ranging from 6 months to 3 years and offer returns which are mostly a percentage higher than banks.Bonds are separate stuff any RBI move to freeze liquidity crashes its price and its a bit safer on principal side.But returns are not sureshot.

Note::
1::TDS applies when interest surpasses 5000 in a year compared to banks 10000.
2::One need to keep tab on not just the TDS certificate but also timely payment of TDS to government with correct pan.Best option would be to put principal in one FD such that interest doesn't surpass 5000 in one in a particular year.
3::Why do company needs fund from public when they can easily get from banks or other lenders?
Reason::Of-course and mostly are they have so much bad assets or bad debts that even banks wont offer them cheap money or wont provide at all.Good companies like HDFC and Shriram Transport rates are just around the same as banks and one should invest in such quality company fixed deposits though returns are less.Also check ratings and invest only in AA rating given by ICRA,Crisil and Care.
4::Even yesterday Unitech also came up with company fixed deposit ads in TOI.The company is number 2 in India in real estate and see their stock price in share market not even 25 rupees.They giving upto 15% return for 3 years but god knows if company bankrupts or real estate bubble bursts its anybody guess about whether they get money or not.
5::If company doesnt pay return there is less chance of even recovering one rupee.Presently all Yash Birla companies are acting same way.Zenith Birla and Birla Corp have stop repaying even principal amount to people especially senior citizen who have loss every bit of their hard earned money.
6::If a company offers more than 12% return or say 2% higher return than banks than be confirm the chance of company failing is high.No one offer such big return and if they does they badly need money to survive.

@John4321
There is no business which gives annual 40% return ever.
Even Warren Buffet made his asset after getting average 20% annual return approximately in last 50-60 years.

One more point stay away from co-operative banks as much as possible.Their directors have habit of financing politicians loss making entities atleast here in Maharashtra.
Just keep upto 1 lakh in co-operative banks including interest calculated.That's the sum insured if something gets bad.

 

[Doremon]

ULIP,Equity stock, MFs are big crap in my case too. Avoid it. One point to take that invest in reliable & root company pioneer into respecitve sector. This should be min 10 yrs long investment and "pay & forget" kinda investment. 5%-10% investment at regular interval of nifty in market leader blueship company for min 10 yrs duration makes a sense. Likewise, I am taking 2 or 3 shares at every downward of market & restrict investment to not more than 7000/month in equity. List out Top 10 comps sectorwise, check depth-asset-p/e ratio, take expert advice & start investing for 2 to 5 shares for a long show.

IMO, the best suite is secured investment - in FDs, Co.FDs, Post, PPF & VPF - 70-80% of savings should be considered. Gold/Silver-10-20%.

Post:- Invest in MIS & reinvest interest income into recurring account. This is one of the popular combo of post scheme comign since old days. You hard to belive this combo gives you 11-12% yeild interest overall. I am doing most of it.

Company FDs/NCD:- Shriram, Jaiprakash, Gruh Finance. Its advisable to avoid long term investment here. Fix to max 1 year.