Sunday, September 9, 2007

Online Investment

How do i make money work for me? When will i achieve financial freedom? what is the ideal age to start investing? When will i become a multi Millionarie.? these are some of the questions that arises in ones Mind.

Well to clear all your myths, i would like to emphasize on 3I fundamentals. Income,Invest & Interest. Save considerable percentage of your income, invest wisely in to diversified funds and stocks and reap rich benefits in terms of returns, years together.

The common question that is asked is "what is the ideal age to start investing?" I would say "Start Investing Now". The earlier the more returns youll get.

To reap rich benefits one needs to have a diversified portfolio. One needs to define his Risk Appetite and depending on his investment Time Frame and Investable Amount he can have his Asset allocation. For example a High Risk Taker will have higher proportion of his Investment in Equities than fixed Income, whereas a low to Low Medium Risk Taker will have higher proportion of his investment in Fixed Income like Fixed Deposits,ULIP,PPF,Bonds etc.

In terms of Equity Shares there are various sectors one can invest in. In Banking Sector one can invest in SBI,HDFC,ICICI Bank at each dip in their current levels. Tn Power Sector one can think of procurement of NTPC,BHEL,Power Grid Scripts. In Communication Rel Comm & Bharti Airtel would be a better bet.ACC, Ambuja Cement are gaining good momentum in cement Sector.In IT sector, TCS, Infosys although has outperformed due to Rupee appreciation, can be given a second thought.

It is advisable to have minimun one year time horizon in terms of Equity Stocks as one can avail of Tax Exemption on Long term capital gain. Short term Capital Gains are Taxable. Although Markets are looking volatile at current levels, Long term investor are unlikely to get nightmares, due to strong fundamentals of Indian Market and better GDP.

Where Mutual Funds are concerned it is advisable not to time the Market. It is better to enter the market through SIP(Systematic Investment Plan) way rather than investing lump sump amount. There are various class of Mutual Funds one can Invest in namely Equity Sectoral, Equity - Debt, Debt, balanced, Liquid Funds. To avail tax exemption one can invest in ELSS funds. In ELSS Funds one can opt for SBI Magnum Tax Gain,Principal Personal tax saver,HDFC Tax Saver, Reliance Tax Saver. These funds have given returns over 50% Annualised.
Other high returns Non Equity Funds are DSP ML fund, DSP ML Tiger Fund, Reliance Media & Ent Fund, Reliance Banking Growth Fund, Franklin Prima Plus & Blue chip fund, SBI Magnum Contra Fund, HDFC Top 200 Mutual Fund.

It is ideal to have higher proportion of Mutual Fund investment in ELSS to avail tax exemption under section 80 C. Most MF's have certain percentage of entry and exit loads which varies from 1 - 2.25%.

To start investing online one needs to have a DMAT and Trading acccount linked to your savings Account. ICICI Direct, reliance Money, Sharekhan, karvy are some of the service provider. With some initail formalities you will be up and working to begin your journey to financial freedom.

For any queries regarding Online investment, Equities & Mutual Fund Investment feel free to reach me at

Also do visit my website for more information. - For Smarter investing.