Sunday, June 14, 2009
Saturday, February 21, 2009
Faces of the week
I have observed some peculiar expressions this week.
Monday, 16th Feb, around 10am: Plan was to go to Dev D with Sanjiv. Shwetha had called one of her friends. But when we reached there, I came to know that tickets were sold out. I told same to Preethi and Shwetha.
Shwetha face showed an expression that was neither horror nor surprise, somewhere in between. She was blank for a moment, not knowing what to tell to her friend.
5 minutes later, Sanjiv came up to book tickets. When I told him the matter, he just looked at me for couple of seconds. At that moment he looked like Calvin’s dad.
Friday, 20th Feb, 5:30pm:
I was getting ready. Went to Deeptish and called him. Then I went to Shobhan, but he seemed furious. I asked whether he was joining us. He gave a tempestuous look and said he was given a load of work. I think he also uttered some swear words within his heart.
6:30pm: Abhinav joined us in the bash and he was trying few sips. Still he was in denial mode. I had to show him some lady far away, so that we can re-fill his glass. He tried to look in the direction, but he was totally confused and turned at me. Deeptish was smiling in front of him. Till today, I don’t know why Abhinav was so confused and why he was sweating that much.
2 hours later, we were leaving for the day, but Vikram was still staring his monitor. I asked him why he is not leaving. He gave a humble look and softly told, ‘Arre, utar nahi raha yaar…! Bike chalana hai !’. And this was the day when we genuinely felt, aaj thoda kam pad gaya bhai.
Thursday, February 19, 2009
Use the Bloodbath
If there was one question that people would pay a crores of rupees to have the answer to, it would be – How do I get rich? The answer is really obvious – if you have a crore to spare then why waste it on a foolish question.
Invest it and over the years you'll surely get your crores.
But that's not the answer they are looking for. Surely there has got to be something more to it — some deep insights, some invaluable pearls of wisdom, some magic!
Not really. It's often just simple common sense. Here are four points on how you can do it:
1. The value of learning
Go back to your earliest memory. When you wanted to ride a bike on your street, the first thing you had to do was learn how to ride. Or when you wanted to pass your Maths exam, you had to learn your tables. Then why is it that when we want to make money, do we not understand that we have to learn good investing?
Instead we tend to just pick up the phone, speak to our stockbroker, buy a stock and start dreaming of becoming rich. That's exactly what rich investors don't do.
Instead, they 'learn' to 'invest'. They learn all there is to know about the art of investing in stocks. All about the stocks they wish to buy and only then do they take the plunge. Above all, they keep practicing what they have learnt. They keep sharpening their saw. This single factor of learning before hand separates the rich investors from the poor investors,
2. Shop at a discount
Another bit of common sense — What do you do when your neighborhood super market announces a SALE? You flock into the stores and buy up every little item and build up at home piles of grocery, soaps, etc. But when stock markets reduce the prices of shares and announce a 'crash' every investor rushes in to 'sell' and runs away from the market.
Again, conversely, when Super Markets raise their prices, customers shy away and refrain from buying till the next 'sale'; but when Stock Markets announce rising prices, every investor rushes in to 'buy'.
This is not the way rich investors behave. They follow the same principle of buying at the super market. They buy stocks only when the stock markets crash. Ask Warren Buffet!
3. Define asset
If you own it, it's an asset. If you owe it, it's not. The rich never keep their wealth in the form of liquid money in a bank account. They always keep acquiring assets while the poor acquire liabilities, which they mistakenly believe are their assets.
A house bought on a loan is not an asset, it's a liability. The same goes for paying for groceries through credit card. So you need to learn the difference.
In life what is important is not how much money you 'make' but how much of that money you succeed in 'keeping' and 'multiplying' .
The rich know how to keep it because they know how to invest it. Money well invested is money well kept. Good investing is often more rewarding than good earning.
4. Make real money
Real money is made when you 'buy' an asset and not when you sell that asset is yet another gem. Be careful of the price you pay when investing in an asset.
Don't rush into buying any investment at any price. Wait till the prices come down the way. The 'price' of the asset when you buy is likely the main determinant of your profit on that asset when sold. If you buy that asset cheap, your profit on sale is obviously larger.
All these four seem rather straightforward now that you think about it. We known all this instinctively and we only have to apply it to the stock markets — it's really common sense.
The only problem is that common sense isn't really all that common.
Happy Investing
Invest it and over the years you'll surely get your crores.
But that's not the answer they are looking for. Surely there has got to be something more to it — some deep insights, some invaluable pearls of wisdom, some magic!
Not really. It's often just simple common sense. Here are four points on how you can do it:
1. The value of learning
Go back to your earliest memory. When you wanted to ride a bike on your street, the first thing you had to do was learn how to ride. Or when you wanted to pass your Maths exam, you had to learn your tables. Then why is it that when we want to make money, do we not understand that we have to learn good investing?
Instead we tend to just pick up the phone, speak to our stockbroker, buy a stock and start dreaming of becoming rich. That's exactly what rich investors don't do.
Instead, they 'learn' to 'invest'. They learn all there is to know about the art of investing in stocks. All about the stocks they wish to buy and only then do they take the plunge. Above all, they keep practicing what they have learnt. They keep sharpening their saw. This single factor of learning before hand separates the rich investors from the poor investors,
2. Shop at a discount
Another bit of common sense — What do you do when your neighborhood super market announces a SALE? You flock into the stores and buy up every little item and build up at home piles of grocery, soaps, etc. But when stock markets reduce the prices of shares and announce a 'crash' every investor rushes in to 'sell' and runs away from the market.
Again, conversely, when Super Markets raise their prices, customers shy away and refrain from buying till the next 'sale'; but when Stock Markets announce rising prices, every investor rushes in to 'buy'.
This is not the way rich investors behave. They follow the same principle of buying at the super market. They buy stocks only when the stock markets crash. Ask Warren Buffet!
3. Define asset
If you own it, it's an asset. If you owe it, it's not. The rich never keep their wealth in the form of liquid money in a bank account. They always keep acquiring assets while the poor acquire liabilities, which they mistakenly believe are their assets.
A house bought on a loan is not an asset, it's a liability. The same goes for paying for groceries through credit card. So you need to learn the difference.
In life what is important is not how much money you 'make' but how much of that money you succeed in 'keeping' and 'multiplying' .
The rich know how to keep it because they know how to invest it. Money well invested is money well kept. Good investing is often more rewarding than good earning.
4. Make real money
Real money is made when you 'buy' an asset and not when you sell that asset is yet another gem. Be careful of the price you pay when investing in an asset.
Don't rush into buying any investment at any price. Wait till the prices come down the way. The 'price' of the asset when you buy is likely the main determinant of your profit on that asset when sold. If you buy that asset cheap, your profit on sale is obviously larger.
All these four seem rather straightforward now that you think about it. We known all this instinctively and we only have to apply it to the stock markets — it's really common sense.
The only problem is that common sense isn't really all that common.
Happy Investing
Wednesday, February 11, 2009
Investing in Gold: The ‘ETF’ way
From PersonalFn.com
Until January 2008, the stock markets witnessed an almost secular bull run for nearly five years. That was the time when equity-linked investment avenues were favorites with investors. It took a sharp fall in equity markets for investors to look beyond equities and consider other investment avenues. Since then, gold is an asset class that has attracted a lot of attention. The reasons for the same are not difficult to guess.
From its peak in January 8, 2008, the BSE Sensex is down by nearly 54% till date. On the other hand, gold has appreciated by almost 25% over the same period. Expectedly, gold has caught the investor’s fancy.
Options for investing in gold
Not too long ago, buying physical gold was the only option for investing in gold. However, the launch of Gold ETFs threw open another option for investors. Gold ETFs are open-ended funds which track prices of gold. They are listed and traded on a stock exchange; hence, they can be bought and sold like stocks on a real-time basis. These funds are passively managed and they mirror domestic gold prices. By enabling investors to invest in gold without holding it in physical form, Gold ETFs offer a rather unique investment opportunity to investors.
Advantages of Gold ETFs
Although the mode chosen for investing in gold would entirely depend on investors, Gold ETFs do offer some distinct advantages vis-à-vis investing in physical gold.
1. Convenience: Gold ETFs are a convenient means of investing in gold. Since there is no delivery involved, investors do not have to worry about the storage and security aspects that are typically associated with investing in physical gold.
2. Quality: As per SEBI regulations, the purity of underlying gold in Gold ETFs should be 0.995 fineness and above. This spares investors the trouble of finding a reliable source to buy gold.
3. No premium: Jewellers and banks generally sell gold at a premium. The premium can be in the range of 5%-10% (inclusive of making charges) in case of jewellers and upto 15% in case of banks. Since Gold ETFs are traded on the stock exchange, they can be bought at the prevailing market rate without paying any premium.
4. Low cost: To store physical gold, one would typically need a locker. This expense is over and above the premium paid at the time of buying physical gold. As for Gold ETFs, a pre-requisite is to have demat and trading accounts with a broker. To maintain these accounts, investors are required to pay annual charges, which vary from broker to broker. Investors also have to pay the brokerage on each trade. Finally, there are annual recurring charges which are charged to the fund.
Considering the premium and other charges borne while buying physical gold, investing via Gold ETFs can turn out to be a more cost effective option.
5. Transparent pricing: The pricing of physical gold varies depending on the vendor. Conversely, Gold ETFs have a transparent pricing mechanism. International gold prices are converted to Indian landed price using the applicable exchange rate. Various duties and taxes are also added to arrive at the landed price of gold.
6. Tax efficiency: In Gold ETFs, long-term capital gains tax is applicable after twelve months from the date of purchase vis-à-vis three years in the case of physical gold. Also, unlike physical gold, investments in Gold ETFs are not subject to Wealth Tax.
7. Resale value: Gold ETFs can be easily sold in the secondary market on a real-time basis (i.e. at the prevailing market price). Whereas, while selling physical gold, the jeweller will deduct making charges (the charge that is added while buying gold). As regards banks, they refuse to buy back gold.
Tax implications
Tax implications on Gold ETFs are same as those on debt mutual funds. So if the units of a Gold ETF are sold within twelve months from the date of purchase, it will give rise to short-term capital gains. The same are taxed at the investor’s marginal rate of tax. For investments held for more than twelve months, long-term capital gains apply; also, investors can utilise indexation benefits.
Criteria for selecting a Gold ETF
Following are some of the factors that investors must consider before investing in a Gold ETF.
a. Percentage of holdings in physical gold
Ideally, investors must select a Gold ETF that holds a significant portion of its portfolio in gold over ones that take cash calls i.e. invests in current assets.
b. Expense Ratio
Investors must choose a fund which has a lower expense ratio. Higher expenses translate into lower returns for investors.
c. Lower tracking error
Tracking error is a measure of the difference between returns generated by a Gold ETF and physical gold. Thus a lower tracking error would mean that the fund has delivered in line what an investment in physical gold would have.
What should investors do
Investors should hold a portion of their portfolio in gold from an asset allocation perspective. Undeniably, Gold ETFs offer investors a convenient means to invest in gold. This will hold especially true for investors who are pressed for time and don’t have a reliable source to buy gold from. Of course, for the allocation that must be made to gold, investors would do well to consult their financial planners/investment advisors.
Saturday, January 24, 2009
NetApp Tops FORTUNE 100 BEST COMPANIES
Excerpts from CNNoney
Even in this economy, some companies are going out of their way to please employees. This year, there's a new no. 1, as NetApp pushes Google to no. 4.
What makes it so great?
Employee enthusiasm for the legendary egalitarian culture helped catapult NetApp to No. 1 after six years on the list.
Typical of its down-to-earth management ethos, NetApp early on ditched a travel policy a dozen pages long in favor of this maxim: "We are a frugal company. But don't show up dog-tired to save a few bucks. Use your common sense." Rather than business plans, many units write "future histories," imagining where their business will be a year or two out.
And the benefits are tops: five paid days for volunteer work, $11,390 adoption aid, and autism coverage -- used by 43 employees since 2006 at a cost of $242,452. The company has gained market share during the slump, hasn't had layoffs, and has more than $2 billion in cash on hand to help it ride out the global financial crisis
#15 in Top Paying companies list
Average total pay: $134,716For: Member Technical Staff, Software 4
NetApp, which has a Technical Support Center open 24 hours, also pays employees working night shifts extra. Staffers working between 1 p.m. and midnight earn 10% more; those working between 11 p.m. and 8 a.m. get a 15% differential. Last year, 98% of NetApp employees received incentive bonuses, which totaled $47 million. And every new employee gets stock options and restricted stock awards.
What makes it so great?
Employee enthusiasm for the legendary egalitarian culture helped catapult NetApp to No. 1 after six years on the list.
Typical of its down-to-earth management ethos, NetApp early on ditched a travel policy a dozen pages long in favor of this maxim: "We are a frugal company. But don't show up dog-tired to save a few bucks. Use your common sense." Rather than business plans, many units write "future histories," imagining where their business will be a year or two out.
And the benefits are tops: five paid days for volunteer work, $11,390 adoption aid, and autism coverage -- used by 43 employees since 2006 at a cost of $242,452. The company has gained market share during the slump, hasn't had layoffs, and has more than $2 billion in cash on hand to help it ride out the global financial crisis
#15 in Top Paying companies list
Average total pay: $134,716For: Member Technical Staff, Software 4
NetApp, which has a Technical Support Center open 24 hours, also pays employees working night shifts extra. Staffers working between 1 p.m. and midnight earn 10% more; those working between 11 p.m. and 8 a.m. get a 15% differential. Last year, 98% of NetApp employees received incentive bonuses, which totaled $47 million. And every new employee gets stock options and restricted stock awards.
Sunday, November 30, 2008
The financially challenged ...
What the financially challenged don't know…
1. They don't know how to get into the money flow.
The crucial distinction between sportsmen and spectators is not that the sportsmen play and the spectators watch; it's that sportsmen get paid, while spectators pay!To get paid you need to be inside the lines, on the field of play. As long as you're the one settling debts, you're a spectator. You're investing in someone else's game.
2. They don't know how to create value.
To get into the money flow means creating value, and value is created automatically when you're in your own flow, when you're doing what comes naturally to you.Warren Buffet is in his flow - buying undervalued stocks. He has an eye for spotting opportunities in great business opportunities, which he buys. He has become second richest person in the world.Donald Trump is in his flow buying and selling property. He has an eye for spotting opportunities in buildings, which he buys and sells. He has become one of the biggest property tycoons in America.
3. They don't know the difference between good debt and bad.
When you buy a luxury car or a fancy electronic gadget, you're buying a liability. Any purchase that does not put cash in your pocket is a liability.Good debt buys assets that bring in cash. If you take a loan to buy an apartment building that will produce revenue, that's good debt. You can also borrow against your mortgage to acquire more assets.
4. They don't know how Rs100 saved can be turned into Rs1000 invested.
When you're spending everything you earn just to survive and pay off debt, you normally think you don't have much left to save.But the truth is you don't need loads of cash to start saving, a few hundreds saved can be used to raise finance to buy an asset that will generate thousands. You can start with as little as Rs1000.
5. They don't know how to use other people's resources.
Take a look at any wealthy or successful person. Are they operating alone, or do they have a team of supporters?The gung-ho, lone-ranger approach simply does not work. The first step to getting on to the field is putting the right team together. You don't have to know how to do everything, you only have to know who can do it for you.This is a key to your success.Have an asssociation with the right team of mentors,advisors, partners & workers.
6. They don't know how to control their emotions.
Starting your own business is risky. So is any investment. The single most important factor is not knowledge, but being able to manage your own emotions.Most people don't invest or don't start their own business or manage an investment, not because they don't know how, but because they're afraid. which leads to errors of judgment. Emotional maturity is absolutely crucial.
7. They don't know why they want to be rich.
Most people just have a vague idea that they'd like to be rich. They don't know why. They don't know what they'd do with it once they get it. If you don't have a good enough reason you should find one now.
Wednesday, November 26, 2008
Saturday, November 22, 2008
5 investment tenets
Once you invest your surplus in stocks, make a commitment to stay invested. The market is bound to gyrate and there is no use reacting to its every move.
http://www.thehindubusinessline.com/iw/2008/11/16/stories/2008111650541500.htm
http://www.thehindubusinessline.com/iw/2008/11/16/stories/2008111650541500.htm
Subscribe to:
Posts (Atom)
