Ayush Singh’s Post

Your mutual funds are about to change! Here is how- India's market regulator, SEBI has now proposed to open the Credit Default Swap (CDS) market for Mutual Funds. But what does it mean? Well, a company can raise money in many different ways. It could borrow from banks or other financial institutions. Or it could issue its shares to the public. But these options come with their fair share of problems. A bank loan for instance could come with a high interest cost. And offering shares to the public would mean diluting existing shareholders, because external shareholders get a say over how the company operates. It could weaken the management’s control over the company’s decisions. So what could it do? Well, it could issue something called a corporate bond. It could take a loan from the public for a fixed period of time, in exchange for regular interest payouts. And when that term expires or on the maturity of the bond, it could pay them back the amount it initially borrowed. The interest on this won’t be as high as a bank loan. Besides, issuing bonds won’t even dilute the management’s control of the company’s affairs. So it’s a win-win. But here’s the thing. Corporate bonds aren’t a very mature market in India. And one reason for it could be because these instruments come with a very real risk. Corporates may not repay investors back if they go belly up. So then why is SEBI unlocking the CDS market for Mutual Funds? Get the full scoop here- https://bit.ly/3KLp5M8 And don't forget to follow Finshots for more insightful content!

India's market regulator, SEBI has now proposed to open the Credit Default Swap (CDS) market for Mutual Funds. But what does it mean? Well, a company can raise money in many different ways. It could borrow from banks or other financial institutions. Or it could issue its shares to the public. But these options come with their fair share of problems. A bank loan for instance could come with a high interest cost. And offering shares to the public would mean diluting existing shareholders, because external shareholders get a say over how the company operates. It could weaken the management’s control over the company’s decisions. So what could it do? Well, it could issue something called a corporate bond. It could take a loan from the public for a fixed period of time, in exchange for regular interest payouts. And when that term expires or on the maturity of the bond, it could pay them back the amount it initially borrowed. The interest on this won’t be as high as a bank loan. Besides, issuing bonds won’t even dilute the management’s control of the company’s affairs. So it’s a win-win. But here’s the thing. Corporate bonds aren’t a very mature market in India. And one reason for it could be because these instruments come with a very real risk. Corporates may not repay investors back if they go belly up. So then why is SEBI unlocking the CDS market for Mutual Funds? Get the full scoop here- https://bit.ly/3KLp5M8

#financialempowerment Isn't it interesting to read this ? Funds flow into open-ended equity funds, jumped 23% to Rs 26,865.78 crore in February, according to the data released by the Association of Mutual Funds of India (AMFI), the industry trade body for mutual funds, on March 8. (Source article attached). Gone are the days when people used to draw their entire salary in cash and spend, retain balance as cash. Gone are the days when only Bank FD was considered as an investment. From risk averse era, people have transformed to taking calculated risks by investing in stocks and mutual funds. Banks also educate customers to open 3 in 1 accounts Savings, Demat and online trading accounts) and enable their investments in #stockmarket . Mobile apps have made it user friendly for buying and selling shares and new platforms like #zerodha and #upstocks are getting familiarity and popularity among people, particularly beginners. Good to see parents teaching children about #financialmanagement Times are changing and so are we. #makehaywhilethesunshines #timetothink #timetochange #financialgoals #financialliteracyforkids #financialliteracymatters

Would be interesting to see how this pans out.. CDS ( Credit Default Swaps ) is an interesting avenue for the mutual funds to build a revenue stream. 1. But why would public want to pay a guarantee for a financial instrument , doesn't it reduces the earning potential. 2. What happens if the risk of default is high so does the premium charged by Mutual funds , it doesn’t instill confidence. 3. If the risk of default is high why would mutual funds even offer a guarantee , wouldn’t make business sense. 4. What is the incentive for public to buy guarantees for a safe asset class -> this would be good revenue generator for the MFs selling CDS. This move leads to more questions than incentives to participate in the mutual funds for the general public. #mutualfunds #finance

The Pros of Investing in Mutual Funds Potential For Returns: The allure of Mutual Funds lies in their capacity to yield substantial returns, potentially surpassing conventional savings avenues. Battle With Inflation: In the ever-changing landscape of economics, Mutual Funds strive to outpace inflation, preserving your purchasing power. Embracing Diversification: By virtue of their diverse asset allocation, Mutual Funds mitigate risk by spreading investments across different instruments. Guided By Experts: Seasoned fund managers helm investment decisions, leveraging their expertise to optimise returns while minimising risks. Liquidity Lever: Mutual Funds bestow a higher degree of liquidity, enabling you to buy or sell units as per your evolving needs. Tax Benefits: Investments in Equity-Linked Savings Scheme (ELSS) funds can help you save up to ₹1.5 Lakhs each financial year, under Section 80C of the Income Tax Act of India. The Risks in MF Investments Market Risk: Mutual Fund returns are influenced by the performance of the underlying assets. Market fluctuations can lead to volatility and potential losses. Expense Ratio Impact: Mutual Funds incur expenses that are borne by investors through the expense ratio. High expense ratios can eat into your returns over time. Exit Load: Some Mutual Funds charge an exit load if you redeem your units before a specified period. This can impact your liquidity and overall returns. Tax Implications: Gains from Mutual Funds may be subject to capital gains tax. Different fund types have varying tax implications.

How to compute period of holding to decide Long term Capital gains for Various assets. 1. Listed share and units if s.t.t. paid 12 months. 2. units of mutual fund having equal to or more than 35% invested in domestic Companies shares 12 months. 3. Units of Mutual fund having less than 35% in domestic companies shares and debt fund, Purchase before 01/04/2023 36 months 4. units of Mutual Fund having less than 35% in domestic companies shares and debt funds, purchased from 01/04/2023 irrespective of holding period short term. 6. debentures of any company irrespective of period of holding always short term. 5. bullions like gold and silver 36 months. 6. immovable property 24 months. 7. unlisted shares 24 months. 8. ulip if equity on maturity all.long term if premium above 2.50 Lakh Identifying few Mutual fund whether debt or equity ,listed on stock exchange. 1. Liquid bees - debt fund 2. zerodha bees-liquid -debt fund 3. nifty 50 bees -equity fund 4. banknifty bees-equityfund. SGBs SGBs are government securities issued by the Reserve Bank of India, and are denominated in grams of gold. Capital gains arising on redemption of the bonds on maturity would be considered as an exempt transfer under section 47(viic) of the Income Tax Act, 1961 and hence, not liable to tax. Surcharge on Cap. gain Surcharge rates of 25% or 37%, will not be applicable to the income which is taxable under sections 111A ( Short Term Capital Gain on Shares ), 112A ( Long Term Capital Gain on Shares ), and 115AD ( Tax on income of Foreign Institutional Investors ). Therefore, the highest surcharge rate on the tax payable for such incomes will be 15%. the complexity to decide is huge and needs to kept in mind. Kindly verify at your end before using this and amendments if any subsequent or ommission. #periodofholding #capitalgain #complexcapitalgain

List below⬇️ While Mutual Funds & Stocks provide appreciation value, we also need an investment that can regularly give us some interest or payouts !! How to get monthly, quarterly or annual returns from Investments? If this is your worry, let me help you solve it! Best Income Plans for regular Income : 1. Long-Term Government Bonds For risk-averse investors, government bonds are a great low risk investing choice, these bonds have maturities ranging from 5-40 years. They payout monthly interest or give coupon payments set by the Indian government. 2. Corporate Deposits Corporate Deposits are available from a wide range of NBCs and HFCs, they pay a high interest rate. I myself invested in a Corporate bond with a coupon od 13% paid out semi-annually. Good deal eh? Well here you have to be careful about the paper quality of the Bond and look at the ratings carefully as they are riskier than Government Bonds. 3. Senior Citizen Saving Scheme A SCSS is a good choice if you are a senior citizen, it’s backed by the government and it’s available at bank branches of Post Offices. It’s offering an annual interest rate of 8.2% payable quarterly, It will be in place for 5 years and allows you to invest upto 30 lakh. 4. Post Office Monthly Income POMIS is again backed by the government and is presently giving 7.4% annual interest payable monthly. Individuals can contribute upto 9,00,000 while joint accounts can invest upto Rs 15,00,000. You can start investing with as little as Rs 1,500. 5. Monthly Income Plans This is a mutual fund that invests mostly in fixed income and a minor % on equity. The fund pays out a consistent income to their investors on a regular basis. However the returns are not guaranteed since mutual fund performance drives them. Apart from these 5, you can invest in another 5 investment plans like Pradhan Mantri Vaya Vandana Yojana, Life Insurance plus saving, Systematic Withdrawal Plans, Equity Share Dividends & Annuity Plans! So which one are you investing in 2024? Disclaimer: The post is solely for educational purposes and not recommendatory. #investment #investmenttips #regularincome #investing #passiveincome #moneytalks Follow CA Sneha Tibrewal for such informative updates.

Fixed Deposits (FDs) offer a safe and reliable way to grow your money, especially for risk-averse investors. Unlike volatile market-linked investments like stocks or mutual funds, FDs provide guaranteed returns at a fixed interest rate, ensuring that your principal and interest are secure. Additionally, FDs are low-risk and insulated from market fluctuations, making them a stable option for long-term financial planning. With flexible tenure options, predictable returns, and the ability to earn up to 9.45%* interest per annum, Fixed Deposits are ideal for those seeking safety, stability, and steady income, making them a preferred choice for conservative investors over riskier investment alternatives. 📌 Benefits of Fixed Deposit 💼💰 -------------------------------------------------- 🔝 Higher Interest Rates – Earn attractive returns up to 9.45% p.a. 🔍 Predictability – Enjoy guaranteed returns without market fluctuations. 🛡️ Safety – Your investment is secure with assured returns. 🕒 Flexibility – Choose from a variety of tenures to suit your financial goals. 💧 Liquidity – Access your funds when needed with options for premature withdrawal. 📊 Diversification – A stable way to balance your portfolio against market risks. Fixed Deposits combine security with steady growth, making them a trusted option for all types of investors! 📌 Explore India's Exclusive Online Platform For Fixed Income Investments 👉 https://steadyincome.in/  📺 Explore Video: https://lnkd.in/d97w8jYk *T&C Apply 🤝🏻 Interested to investment? Contact us @ ---------------------------------- 📞 +91 7574000351 📩 [email protected] 🖥️ www.steadyincome.in

❓How to earn 𝗙𝗜𝗫𝗘𝗗 12 - 15% returns 𝗣𝗘𝗔𝗖𝗙𝗨𝗟𝗟𝗬 😇 Recently, I had the pleasure of speaking at Franklin Templeton India's Distributor Meet, where we had over 60 seasoned participants gathered to discuss one crucial topic — "𝗙𝗶𝘅𝗲𝗱 𝗜𝗻𝗰𝗼𝗺𝗲 𝗜𝗻𝘃𝗲𝘀𝘁𝗶𝗻𝗴" It's time to shake off the the myth that bonds and debt mutual funds are dull or low-yielding investments! If you're serious about making the most out of fixed income investments, Here are the key points you should know 👇🏻 🔹 𝑻𝒉𝒆 𝑷𝒐𝒘𝒆𝒓 𝒐𝒇 𝒕𝒉𝒆 𝑰𝒏𝒕𝒆𝒓𝒆𝒔𝒕 𝑹𝒂𝒕𝒆 𝑪𝒚𝒄𝒍𝒆 📉 Interest rates are a game changer for fixed income. When rates fall, bond prices surge. This means capital gains for investors who time the cycle right Even a small 0.5% drop can boost bond prices by 5%! This is key to transforming that expected 7-8% return into a 15-17% growth opportunity 🔹 𝑳𝒐𝒏𝒈𝒆𝒓 𝑴𝒂𝒕𝒖𝒓𝒊𝒕𝒚 𝑩𝒐𝒏𝒅𝒔 = 𝑮𝒓𝒆𝒂𝒕𝒆𝒓 𝑼𝒑𝒔𝒊𝒅𝒆 ⏳ Bonds with longer maturities (10-15 years) are highly sensitive to interest rate changes. When rates are cut, these longer bonds will outperform, offering significant capital appreciation potential 🔹 𝑮𝒍𝒐𝒃𝒂𝒍 𝑻𝒓𝒆𝒏𝒅𝒔 𝑷𝒍𝒂𝒚 𝒂 𝑹𝒐𝒍𝒆 🌍 With global inflation cooling and central banks beginning to ease interest rates, we’re on the cusp of a similar trend in India Repo rate cuts are expected, and when that happens, long-duration debt funds will see major price gains. This creates an excellent opportunity over the next 12-18 months 🔹 𝑫𝒊𝒗𝒆𝒓𝒔𝒊𝒇𝒚 𝒇𝒐𝒓 𝒕𝒉𝒆 𝑾𝒊𝒏 🎯 By creating multiple buckets with bonds across different maturities (5, 10, 15 years), investors can hedge risk and optimize returns during this evolving interest rate scenario Diversification is the key to smoother returns 🔹 𝑻𝒂𝒙 𝑩𝒆𝒏𝒆𝒇𝒊𝒕𝒔 𝒀𝒐𝒖 𝑺𝒉𝒐𝒖𝒍𝒅𝒏’𝒕 𝑶𝒗𝒆𝒓𝒍𝒐𝒐𝒌 💸 Listed bonds offer a lower 10% long-term capital gains tax, which makes them a standout choice over debt mutual funds for tax-conscious clients This is a pivotal time for fixed income investments Educating & making our clients aware on how they can use these strategies to earn equity-like returns with lower risk can help them navigate the interest rate cycle effectively What kind of Fixed Instruments you like to invest in ? Share your thoughts in the comments section 👇🏻 Follow Dhananjay Banthia, PhD for more such insightful posts #franklintempleton #fixedincome #debtfunds #distributormeet #financialeducation

Is a Fixed Deposit (FD) or Mutual Fund Right for You? Fixed deposits (FDs) and mutual funds are two popular investment options in India, but choosing between them can be tricky. Both have their own set of advantages and disadvantages, and the best choice for you depends on your financial goals and risk tolerance. Fixed Deposits (FDs): Safety: FDs offer guaranteed returns and principal protection, making them a safe haven for your money. Liquidity: Depending on the FD type, you can access your money before maturity, though often with a penalty. Predictable returns: You know the interest rate you'll get upfront. However, these returns may not beat inflation over time. Mutual Funds: Growth Potential: Mutual funds, especially equity-based ones, have the potential for higher returns compared to FDs. Beat inflation: Over the long term, mutual funds can potentially provide returns that outpace inflation, helping your money grow in value. Diversification: Mutual funds spread your investment across various assets, reducing risk. Tax benefits: Some mutual fund schemes offer tax benefits. However, mutual fund values fluctuate with the market, so you could lose money. Here's a quick guideline to help you choose: Choose FDs for: Short-term goals, emergency fund, low-risk appetite, guaranteed returns. Choose Mutual Funds for: Long-term goals (retirement, wealth creation), higher return potential, tolerance for some risk, growing your money over inflation. You can also consider a mix of both FDs and mutual funds to create a balanced portfolio that caters to both your safety needs and growth aspirations. What are your investment goals? Let's discuss in the comments! #mutualfunds #fixeddeposit #investment #finance #financialplanning