5 Investing Lessons to Learn This Dussehra

5 Investing Lessons to Learn This Dussehra
by Nutan Gupta 29/09/2017

Dussehra signifies the victory of good over evil. The ‘vadh’ or end of all that is bad and the beginning of new things is celebrated on this auspicious festival. A lot of people decorate their homes, invite relatives and friends to celebrate this joy among them. Here are 5 investing lessons one should learn from this festival.

Have a financial plan ready before attacking Lanka

After Sita's abduction by Ravana, Lord Ram didn’t act on impulse. The legend speaks of Lord Ram taking time out to plan his strategy. He had it all in mind as to where and how they would proceed to Lanka and rescue Sita. You need to do something similar when dealing with money. Earning returns on your investment is not an easy task unless you plan it well. Ensure that you have it all written down or at least have a mental framework. Take into consideration all the costs and risk while making this plan as well.

Diversify your VanarSena

Defeating Ravana wouldn’t have been possible if not for Hanuman and his vanarsena. However, it is important that you spread them out effectively so that more can be done and if calamity strikes, all is not lost. Same goes with your assets. Your assets can be your vanarsena in investment. Ensure you spread out in different funds and plans so that the impact of market fluctuations would be relatively less than when kept concentrated in one fund.

Use self-discipline to confront Rakshas

When confronted by Rakshas or demons on the way, Lord Ram didn’t let fright or panic take over. He was calm. With wisdom and self-discipline, he conquered all the obstacles on the way to rescue Sita. Similar is expected with money as well. The market can have a lot of fluctuations and present obstacles in the path to good returns. But, you need to rely on self-discipline and self-control to not act under impulse and give it time to settle down. Assess the situation with a calm mind and then decide your next step to tackle it.

Aim to kill Ravana and not just injure him

Ravana was sure about his decision of not releasing Sita even though he knew destruction was imminent. Even after constant warnings, his ego kept him from seeing who he was up against. He constantly undermined the capabilities of Lord Ram and his vanarsena. He even tried to inflict harm on them through various techniques and demons. However, Lord Ram’s vision was clear. He knew that Ravana wasn’t one who would realize his mistakes after being injured and thus, had to make a decision to kill him. So it is with money, having a goal in mind will increase the chances of achieving it. It would also help you to take tough decisions of closing the investment in a particular fund when it no longer meets your goals or needs.

Prepare of new beginnings after returning for vanvas

After defeating Ravana and rescuing Sita, Lord Ram returned to Ayodhya to start a new chapter of his life. He was the rightful heir to the throne and after 14 years, he was now ready to take it and lead the people. You need to do the same with your finances. Your money comes back with returns at the maturity of its term, it is now on you to make a new beginning. You choose to use it or reinvest it will determine your future so use it wisely.

Dussehra is indeed a time of celebration where you can celebrate the victory of the good. Using these investment tips, let your money win against all the odds of the market and may you earn good profits this festive season. Wishing everyone a very happy Dussehra.

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Sectors to benefit from Indo-Japan bullet train project

Sectors to benefit from Indo-Japan bullet train project
by Nikita Bhoota 29/09/2017

Indian stock markets have rallied 23% (Nifty 50) and 21% (S&P BSE Sensex) in the first 8 months of FY17. Nifty 50 has crossed the 10,000 mark and Sensex surpassed 32,000 for the first time. It is an uphill task to identify stocks for investment in such a bullish market. One way to select stocks is to spot sectors that are likely to see an organic growth supported by concrete development plans/policies of the government.

Among the recent developments, Mumbai-Ahmedabad bullet train project in collaboration with Japan is a remarkable project. In this project, Japan will be the primary financier wherein it will fund 81% of the project cost at an interest rate of 0.1%; the overall cost is expected to be Rs 1.1 lakh crore. The project is expected to be completed by FY22.

On the basis of the above development, we believe Capital Goods, Metals, Infrastructure and Cement sectors to benefit the most from this project.

Capital Goods

Capital Goods sector is the backbone of the numerous manufacturing subsectors in the country such as Heavy Electrical Equipments, Power, Defense and Railways. The sector has seen 3.7% growth in FY17. Going forward, Capital Goods sector is expected to grow with the support of government initiatives like Make in India and bullet train project. Some of the stocks that are likely to benefit from bullet train project include:

BHEL - Government-owned BHEL, India’s largest power equipment manufacturer with 55% market share in the segment, is likely to play a major role in country’s bullet train project. BHEL and Japan-owned Kawasaki Heavy Industries have formed a joint venture to manufacture rolling stocks for the project. According to recent reports, the company is expected to manufacture the coaches at its Jhansi Plant in Uttar Pradesh or Bhopal in Madhya Pradesh. The company has an order backlog that stands at Rs 101,380 crore in Q1 FY18.

Siemens and ABB - These companies are expected to benefit from bullet trains as they manufacture electrification systems and high-speed rail traction. ABB derives ~25% of the total revenue from electrification products business.


India is the 3rd largest steel producer in FY17 with total production of finished steel at 83.01 million tonnes. Government is taking steps to improve the country's domestic steel sector and raise its capacity to 300 million tonnes (MT) by 2030-31. Pickup in domestic activity as well as commencement of developmental programs like construction of smart cities, bullet train etc will increase the demand for metals and related products. Some of the companies to benefit from the bullet train project include:

Tata Steel and JSW Steel - These stocks are likely to benefit from the project as it will increase the demand for commodities like steel, iron etc. JSW Steel is one of India’s largest private sector steel manufacturers with a capacity of 18mtpa followed by Tata Steel with an installed capacity of 10mtpa.


The Government of India is highly focused on improving the rail and road connectivity in the country. Road Transport & Highways Ministry has invested around US$ 47.7 bn and Union Budget 2017 has further allocated Rs 131,000 crore for laying down 3,500 km of railway lines in 2017-18. Metro rail and bullet train project are the step towards developing urban infrastructure in the country. Some of the stocks to benefit from these initiatives:

NBBC- The company is likely to get new orders for development of new railway stations once the bullet train project is commissioned. The company recently got orders to develop 50 stations (10 stations in June 2017 and rest in September 2017). The company has a strong order book of Rs 75,000 crore in Q1 FY17 (90% from PMC and redevelopment segment, 10% from real estate and EPC division).

Larsen and Toubro Ltd - L&T offers services like construction of railway sidings and yards, bridges (steel and concrete), tunnels, rail-based urban transit systems (metro systems), stations (including underground stations), railway electrification, rolling stock, locomotives, intercity coaches, wagons and so on. The company has a total order book of Rs 262,900 cr as on Q1FY18.


India is the 2nd largest producer of cement in the world.  It has a production capacity of 420 MT as on June 2017. The country has a lot of potential for development in the infrastructure and construction sectors and the cement sector is expected to largely benefit from it. Some government initiatives like smart cities and bullet train project will boost the demand for cement. Some of the companies to benefit are:

Ultratech Cement- It is the largest cement producer in India with a cement capacity of 95.3 MT (includes acquisition of the cement plants of JAL and JCCL- 21.2 MT and overseas operations). It has a market share of 22% on a pan-India basis and is the 4th largest player globally.

Some of the other cement companies to benefit from this project are ACC, Ambuja and Prism Cement.


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What is the right age to buy a term life insurance cover?

What is the right age to buy a term life insurance cover?
by Nutan Gupta 01/10/2017

Death comes knocking at the door without any prior notice. The death of the only breadwinner of the family brings the family into severe financial crisis. This is the time when you realise the importance of a term insurance policy the most. A term insurance plan secures the life of your loved ones and helps them to meet their day-to-day expenses. It is always better to buy a term insurance plan early in life as an individual gets immense benefits for starting early. Also, the premium charges are also low when you are young.

Let’s take a look at the different ages and factors that one should consider while buying a term insurance.


During the 20s, an individual just steps into his professional life and is relatively debt free. He has lesser family responsibilities and buying a term cover at this age can help him pay off his education loans if any. Moreover, term insurance premiums are less expensive when an individual is young.


An individual, in his 30s, tend to have family and kids. While his income is higher at this age, the responsibilities are much more. He may have financial liabilities like home loan, car loan etc. The premium will tend to be slightly higher, given the family responsibilities.


During this age, an individual’s long term financial liabilities like a home or car loan is paid-off. However, he may have higher responsibilities like his child’s higher education or his own retirement planning. It is better to opt for a cover which provides a greater coverage and financial protection. The cover should be able to take care of your family expenses after your death.


When an individual reaches this age, his children already start earning and most of the debts are paid-off. Family members are not financially dependent on your earnings. During this age, what an individual is most concerned about is his retirement. At this age, the best option for an individual is to buy an endowment plan which will help him save and give him a lump sum amount on maturity.

Term Insurance Premium amounts for a cover of Rs. 50 lakh

Age Premium Amount
22 Rs. 4,270
32 Rs. 5,455
42 Rs. 9,606
52 Rs. 17,534

The above table shows the difference in premiums as per the age of an individual. As the age increases, premium increases.


Age plays a major role in deciding the amount of your term insurance. The biggest mistake an individual makes is to not opt for a substantial cover for the family. One should make sure that the term cover takes care of all the basic necessities of the family in case of the sudden demise of the policyholder.

Get a Term Insurance Cover Now!

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Tax Saving Investments and their Features

Tax Saving Investments and their Features
by Nutan Gupta 01/10/2017

This is the time of the year when you start getting calls from the HR of your company asking for investment declarations. If you have not made any investments yet, here is the list of instruments where you can invest.

Instrument Investment Section of IT Act Lock-in Period Returns Risk Taxation at Maturity
ELSS ELSS is a type of mutual fund scheme where most of the fund corpus is invested in equities or equity-related products. 80C 3 years Not fixed, depend upon the performance of equity market. However, in the past, ELSS has given average returns of 12-14%. Carries some risk Tax-free
PPF It is a type of investment which is provided by the Government of India 80C 15 years The rate of returns changes as per government policies.

Current returns - 8.1% compounded annually
Risk-free Tax-free
NSC NSC are bonds issued by the government for small savings and one can purchase these bonds from post offices. 80C 10 years The interest rate on NSC is decided by the government every year. It is linked to the yield of 10-year government bonds.

The current interest rate is 8%.
Low Risk Interest is Taxable
Pension Mutual Funds Pension Mutual Funds invest 40% of the money in equity and 60% in debt instruments. 80C Until you reach the age of 58 The returns in pension mutual funds are not fixed as it depends on the performance of the equity and debt market. Pension mutual funds have given an average return of 8-10% for a 5-year and 10-year period. Carries some risk Tax-free
Tax Saving FD It is a special fixed deposit made with any bank. 80C 5 years The interest rate varies from one bank to another. It usually ranges from 6.5-7.5%. Risk Free Interest earned is taxable
Rajiv Gandhi Equity Saving Scheme Exclusively for first time retail investors. Individuals with an annual income below Rs. 12 lakh can invest. 80CCG 3 years Depends on the performance of equity markets. Carries some risk 50% of the invested amount
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5 Financial Priorities When You Turn 40

5 Financial Priorities When You Turn 40
by Sumit Kati 07/10/2017

Whether it’s your 20’s, 30’s or your 40’s, every decade brings its own set of experiences and expectations. However, it can be said that there is something sweet about your 40’s. You are more or less settled in your life, where you have a fair idea of what your future will be like.

This decade also signals the approach of your retirement, and hence, you cannot afford to make any financial mistakes as opposed to your carefree 20’s where new things were considered adventurous and worth a try.

Following are the five priorities that any 40-something should abide by :


1.Make Sure You Are Insured
There is a big difference between being insured just for namesake and being adequately insured while taking your lifestyle into consideration. Don’t delay in buying the right insurance policy[Keywords are added in Bold in the article. Please make sure to add keywords in the article and make them bold from the next time. ] as there is a hike in premium rates as your age progresses. 
Term insurance is a great way of getting a high-risk cover as well as keeping your savings intact. A comprehensive health cover is a must as well in the face of ever-rising healthcare prices. 

2.Get Your Family Involved 
Many don’t realise it, but it makes a world of difference when our family members are in sync with our financial goals. Whether it’s your parents or spouse, by aligning your financial plan with them, you can save more as opposed to going at it alone. Even a minuscule amount at present can add up to great savings for the future. 

3.Learn Something New
Just because you are in your 40’s doesn’t mean that you have to settle down completely. Mix up that routine by practising a skill that you’ve always wanted to master. This also prevents the eventual complacency that comes with getting used to your regular work.
A well-learned skill can translate to a new side venture which will lead to you earning and eventually saving more money for your retirement corpus. 

4.Wipe Off Your Debt
Without you even knowing it, being in debt takes away a huge chunk of your future savings. Thus paying off all your high-interest debt (other than long term home loan) is the first step towards being financially sound. 
Start using portions of your bonuses or even tax refunds to pay off your high-interest credit card bills and other accrued debt, or else you will end up losing a huge chunk of savings in interest payments. 
It also makes sense to start organising your expenses. By now most of your bills should be on auto pay which makes your expenses streamlined and easier to keep track of. It also saves valuable time. 

5.The Retirement Goal
There is no better time than your 40’s to seriously start building up your retirement savings. Create a retirement fund and keep a portion of your income dedicated towards its growth. You can also invest in Public Provident Fund and National Pension Schemes by the government for better returns. 




In a nutshell

As the saying goes, ‘It’s better late than never,’ take control and manage your finances well in your 40s so that they take care of you when you need them later. A better plan would be to have an organised approach by  getting a financial planner/portfolio manager to draw up a retirement portfolio for you.



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How To Buy Stocks Online?

How To Buy Stocks Online?

In the older times, stock market was difficult for a common man because of lack of know-how. That is why it was extremely essential to consult a stock broker before investing. Back then, the brokers were the only source of stock purchase.

The internet has solved this problem for the common man. Now there are a large number of websites that give you a good working knowledge of the stock market. They can also give you good advice about when you should and shouldn’t invest in shares.

Thus, with the authentic information about stocks that is available on the internet, people with limited savings can get good knowledge about the stocks. They can not only get information about the stocks, but they can also buy stocks online starting from prices as low as Rs. 500. 

Process of Buying Shares Online
1) To buy and sell shares, one needs Demat and Trading accounts. Both of these are provided by the two Depositories namely NSDL and CDSL through brokerage companies. One has to visit or contact a brokerage company offices for opening those accounts.

2) Generally, stock trading is possible in India between 9:30AM to 3:30PM. Stocks can be traded on all working days from Monday to Friday. The stock exchanges are closed on bank holidays and national holidays.

3) You can log into you online Trading account. Visit the online portal of your trading account. To log into your trading platform, you will have a user name and a password. Make sure you memorize these important login details.

4) It is important to do a pre-study before selecting a stock. Stock study is not just a study of its market price. More than the price,  it isimportant to judge the company’s fundamentals.

5) To buy stocks, put a buy-order to trading account and wait for order execution. Setting up a price-limit to buy stocks is a good habit.

As you can see brokers are no longer a necessary part of the transaction while buying and selling shares. However, it is still advisable to consult a broker.

With the changing times brokers too have modified their services. Few years ago, there was only one type of broker, the Full-time broker who handled the complete buying, selling and monitoring of your shares. Today there are different types of brokers available in the stock market:

Types of Brokerage services

Full-service broker
Full-service broker is a broker who gives Stock advisory plus trading facility to the investors. They generally charge 0.3% to 0.5% of the total amount invested by the customer as brokerage. Suppose you buy 1000 ICICI bank shares for Rs.500 each, your brokerage charge would be Rs.500000*0.5%= Rs.2500

Discount Broker
These are new brokers who provide a trading platform to the investor but don’t give much advisory. Discount brokers usually charge Rs.20 per trade, irrespective of amount. Suppose you buy 1000 ICICI bank shares for Rs.500 each, your brokerage would be flat Rs.20.

People who are not so internet savvy and hesitate to buy stocks online it is great to refer a broking agency. Check out 5paisa.com to find out the services on offer for trading in stocks online. We offer a flat rate of Rs.10 for every transaction whatever the value of the deal. This makes our  services valuable whenever you are buying shares.