Meaning of Investment Portfolio A portfolio is a collection of securities. Since it is rarely desirable to invest the entire funds of an individual or an institution in a single security, it is essential that every security be viewed in a portfolio context. An investment portfolio comprising of different types of securities and assets. As the investors acquire different sets of assets of financial nature, such as gold, silver, real estate, buildings, insurance policies, post office certificates, NSC etc., they are making a provision for future. The risk of each of such investments is to be understood before hand. Normally the average householder keeps most of his income in cash or bank deposits and assumes that they are safe and least risky. Little does he realize that they also carry a risk with them — the fear of loss or actual loss or theft and loss of real value of Continue reading
Investment Management
Types of Debt Mutual Funds
Debt mutual funds are those that predominantly invest in debt securities. Since most debt securities pay periodic interest to investors, these funds are also known as income funds. However, it must be remembered that funds investing in debt products can also offer a growth option to their investors. What is more important is that the portfolio is predominantly made up of debt securities. The universe of debt securities comprises of long-term instruments such as bonds issued by central and state governments, public sector organizations, public financial institutions and private sector companies; and short-term instruments such as call money lending, commercial papers and certificates of deposits and treasury bills. Debt funds tend to create a variety of options for investors by choosing one or more of the segments of the debt markets in their investment portfolio. Liquid Funds And Money Market Funds: These debt funds invest only in instruments with maturities Continue reading
Gold Investment – Meaning and Benefits
Since prehistoric time, human are using the gold in trading and value keeping asset. Even current financial activities are always surrounding by the gold issue. The ancient treated the gold as the true form of wealth. Gold has been using early in 4000 B.C as a fashion decorative object in where today Eastern Europe is centered. In 1500 B.C the gigantic gold-bearing regions of Nubia made Egypt a wealthy nation. By the time the gold has widely recognize as the standard form of medium of exchange for international trade. Gold is represented the royal and honorable in different religious and cultural area. Its aesthetic appearance is the finest ornament above all other metal. Gold play the role in all aspect around us, such as religious customs, reward system, ornament, jewellery, and even the component of industrial product. Gold exist and be using for decade, its intrinsic value is still maintain Continue reading
The need for demutualization of stock exchanges
Demutualization of stock exchanges implies that a mutually owned stock exchange is converted into a company owned by shareholders. In other words transforming the legal structure, of an exchange form to a business corporation form is referred to a demutualization. The ownership, management and trading is separated and are in different hands. They are clearly separated like a commercial entity. The management of the exchange is separated from the shareholders and the brokers. Need for demutualization: Stock exchanges owned by members tend to work towards the interest of members alone, which could on occasion be detrimental to rights of other stakeholders. Division of ownership between members and outsiders can lead to a balanced approach, remove conflicts of interest, create greater management accountability, and take into consideration the interest of other players. To cope with competition, stock exchanges require funds. While member-owned stock exchanges have limitations in raising funds, publicly owned Continue reading
Factors Conducive to the Growth of Mutual Funds
On observing the past trends, it can be seen that certain factors are essential for the growth of the mutual funds industry. These factors are: Investor Base: A mutual fund makes it possible for investors to earn a higher return on their capital by pooling the capital of a large number of small investors and investing the pooled sum in a diversified manner. As the small investors cannot diversify on their own, their presence acts as a catalyst for the mutual funds to grow. As different investors have different investment requirements, their presence also acts as an incentive for the mutual funds to come up with new schemes, thus helping in further evolution of the industry. Returns On Market: Mutual funds invest in a diversified manner; the returns generated by them are generally reflective of the market returns. Higher the market returns, higher the expected returns from mutual funds. Higher Continue reading
Learn about Securities Investments – Buying and Selling
Buying Deciding on the proper time to purchase a security that you would like to add to your holdings can be a daunting task. If the price drops immediately after you buy, it may seem as if you missed out on a better buying opportunity. If the price jumps right before you make your move, you may feel as if you paid too much. As it turns out, you should not let these small fluctuations influence your decision too much. As long as the fundamentals that led you to decide on the purchase have not changed, a few points in either direction should not have a large impact on the long-term value of your investment. Similarly, the fact that an investment has been increasing in value of late is not a sufficient reason for you to purchase it. Momentum can be very fickle, and recent movement is not necessarily an Continue reading