Nonsecuritized

financial
securities

Financial
securities

Investment
Options

Mutual
fund
schemes

Real
assets

Financial
securities

These investment instruments are freely

tradable and negotiable. These would
include

equity shares
preference shares
convertible debentures
non-convertible debentures
public sector bonds
savings certificates
gilt-edged securities and money market
securities.

http://www.narachinvestment.com/investment_avenues.htm

Nonsecuritized
financial
securities

These

investment instruments are not

tradable, transferable nor negotiable
and would include
bank deposits
post office deposits

company fixed deposits

provident fund schemes
national savings schemes and life

insurance.

http://www.narachinvestment.com/investment_avenues.htm

Real
assets

Real

assets are physical investments,

which would include
real estate
gold & silver, precious stones, rare coins &
stamps

Wine and Art.

http://www.narachinvestment.com/investment_avenues.htm

Mutual
fund
schemes

If

an investor does not directly want to

invest in the markets, he/she could
buy units/shares in a mutual fund
scheme. These schemes are mainly
growth (or equity) oriented, income
(or debt) oriented or balanced (i.e.
both growth and debt)schemes.

http://www.narachinvestment.com/investment_avenues.htm

Financial Securities
Equity
Non-convertible Debentures
Financial Securities (Nonsecuritized)
Bank deposits
Provident fund
Life insurance
Mutual funds
Growth/equity
Income/debt
Real assets
Real estate
Gold/silver

Rate of
return
Annual
Income

Risk

Tax
Marketability Benefit

Rate of return
Capital
Appreciation

Convenience

Low
High

High
Low

High
Low

High
Average

Yes
Nil

High
High

Low
Nil
Nil

Nil
High
High

Low
Nil
Nil

High
Average
Average

Yes
Yes
Yes

High
High
High

Low
High

High
Low

High
Low

High
High

Yes
Yes

High
High

Low

High

Low

Low

Limited

Average

Nil

Average

Average Average

Nil

Average

Raw land, High

Commodities, Stock
Options, Speculative
Active Stocks.

Risk

Growth Stock and Medium Risk

Stock funds PSU bonds
and debt funds, Mutual
Funds
Bank accounts and money market
funds, savings bonds, certificates of
deposit, treasury bills and notes,
fixed annuities, Relief bonds.
http://www.mywealthguide.com/persnl.htm

Foundation

Investing in Mutual Funds.

Diversification of stocks as a
result low risk.

Decisions are made by the

Expert money mangers.
Individual Investors have no
say in what is to be included
in the fund.

Particularly helpful for a

person with limited fundsLower cost alternative of
managing your funds.

Investing directly in the Stock

Market

Risky investment due to

volatility in the stock
prices.

Free to decide on what

stocks to invest in and
when.

Buying a widely diversified

basket of stocks can be
difficult for all but the
wealthiest investor.

Investing in Mutual Funds.

MFs provide a better
return than bonds.
Actual
value of the
mutual fund share is not
as precise.

Investing directly in the stock

market

In the stock market

however the actual
price at a particular
point of time can be
determined.

Advantages

Affordability
Diversification
Regulations
Variety
Tax Benefits
Professional
Management

Disadvantages

No Guarantees.

The Diversification
"Penalty.

Costs.

Advantages
Outperforms other
Investments.
Easy Review and
Research
Easy Access
Transparency

Disadvantages
Volatile investments
Brokerage
commission
Diversification is
difficult

Net asset value (NAV) is a term used to

describe the value of an entity's assets less the
value of its liabilities.

(NAV= Market/Fair Value of schemes

investment + Receivables + Other assets
Accrued expenses Payables Other
Liabilities.)/ Number of Units outstanding.

Net asset value may represent the value of the

total equity, or it may be divided by the
number of shares outstanding and, thereby,
represent the per share net asset value.

Cash and equivalent holding stock held at market price

200000

10,000 shares of A Co @ Rs 50.

500000

20,000 shares of B Co @ Rs 30.

600000

50,000 shares of C Co @ Rs 8.

400000

1500000

TOTAL ASSETS

1700000

LESS LIABILITIES

100000

Net Assets

1600000

Scheme units Outstanding

100000

NAV per unit

16

Types of Mutual Funds

Open Ended
and Close
Ended

Interval Funds

Load and No
Load Funds

Money Market
Funds

Tax Saving

There are two ways in which you can invest in a mutual fund.
1. A one-time outright payment
Let's say you want to invest Rs 10,000. All you have to do is
approach the fund and buy units worth Rs 10,000. There
will be two factors determining how many units you get.
Entry load
This is the fee you pay on the amount you invest. Let's say
the entry load is 2%. Two percent on Rs 10,000* would Rs
200. Now, you have just Rs 9,800 to invest.
NAV
The Net Asset Value is the price of a unit of a fund. Let's
say that the NAV on the day you invest is Rs 30.
So you will get 326.67 units (Rs 9800 / 30).

2. Periodic investments
This is referred to as a SIP.
That means that, every month, you commit to investing,
say, Rs 1,000 in your fund. At the end of a year, you would
have invested Rs 12,000 in your fund.
Let's say the NAV on the day you invest in the first month is
Rs 20; you will get 50 units (1000/20).
The next month, the NAV is Rs 25. You will get 40 units.
The following month, the NAV is Rs 18. You will get 55.56
units.
So, after three months, you would have 145.56 units. On an
average, you would have paid around Rs 21 per unit. This
is because, when the NAV is high, you get fewer units per
Rs 1,000. When the NAV falls, you get more units per Rs
1,000.

Register with an investment firm or

stockbroker
Define your goal
Define your asset allocation
Evolve a portfolio
Get tracking

Mutual funds in India

The fund industry has grown phenomenally over

the past couple of years, and as on 31 January
2008, it had debt and equity assets of Rs 5,50,157
crore.
Its equity corpus of Rs 2,20,263 lakh crore accounts
for over 3 per cent of the total market
capitalisation of BSE, at Rs 58 lakh crore. Its holding
in Indian companies ranges between 1 per cent
and almost 29 per cent, making them an influential
shareholder. Together with banks, insurance
companies and FIIs collectively called
institutional investors they have the ability to ask
company managements some tough questions.

Rank

Scheme Name

Date

NAV (Rs.)

Last 1 Week %

Kotak Wealth Builder

Series I - Growth

Jan 27 , 2010

11.9626

0.9502

Birla Sun Life Equity

Linked FMP - Series C Retail - Growth

Jan 27 , 2010

11.7156

0.5847

ICICI Prudential Gilt Fund

Investment Plan - Growth

Jan 27 , 2010

31.6225

0.5679

Birla Sun Life Equity

Linked FMP - Series D Retail - Growth

Jan 27 , 2010

12.3176

0.5617

IDFC Super Saver Income

Fund - Medium Term Plan Plan B - Growth

Jan 27 , 2010

10.5408

0.5611

THE FUNDAMENTAL CORNER STONES OF SUCCESSFUL

INVESTING ARE :

SAVE REGULARLY, INVEST REGULARLY

START EARLY

USE TAX SHELTERS

INVESTMENT RETURNS SHOULD EXCEED THE INFLATION.