Raising fuel prices would stoke inflationary pressures, already at levels uncomfortable enough for voters to slam Congress in recent municipal elections in West Bengal.
India's food inflation accelerated in mid-June and further inflationary pressures could lead the central bank to raise interest rates ahead of a July 27 policy review.
"Yes, a rise in petrol and diesel prices will be reflected in the fuel inflation numbers and there will also be second-rung impacts reflected in transport costs, etc," said Atsi Sheth, chief economist at Macro-Sutra in Mumbai.
"The fiscal implications, too, regarding the subsidy bill, are positive. On the monetary front, I don't see the Reserve Bank of India (RBI) reacting to this as an immediate trigger."
"Global commodity prices, even before this hike, have been contributing to high inflation and the RBI will, therefore, consider all these factors and will not react solely to this decision," he added.
Any move to remove price controls will help Reliance Industries(RELI.BO), which operates the world's biggest refining complex but exports most products as the local market is dominated by state firms that sell cheap fuel, helped by government subsidies.
Finance Minister Pranab Mukherjee said earlier this week he believed a strong harvest following a normal monsoon would tame food prices.
Indian farm ministry officials on Friday gave their most optimistic forecast yet for the annual rains -- which irrigate 60 percent of the country's farms -- saying the June-September rainfall would likely be 102 percent of the long-term average.
Friday, June 25, 2010
Historical Decision on Petro Products by Government
The government on Friday freed up state-subsidised petrol prices and hiked other fuels as high global oil prices and pressure to trim the budget deficit outweighed concerns about the political impact of the measures.
A panel of ministers increased prices of state-subsidised diesel, kerosene and cooking gas prices, which could help reduce the fiscal deficit from the projected 5.5 percent of 2010/11 GDP and free up revenues for other programmes.
The panel said petrol prices would be market driven, rising 3.50 rupees per litre, while kerosene prices would rise by 3 rupees a litre. While petrol is mainly used by the middle class for cars, kerosene is used by the poor for power.
Diesel prices will rise 2 rupees per litre and will be freed up in the future. Cooking gas prices were raised by 35 rupees a cylinder.
"It was decided that the price of petrol will be market determined both at the refinery gate and at the retail level," Oil Secretary S. Sundareshan told reporters.
India's benchmark bond yield rose 2 basis points immediately after the news on concerns that the hikes would push up inflation.
The benchmark 5-year swap rate rose 1 basis point to 6.74 percent while the 1-year swap rate rose 2 basis points to 5.50 percent. Shares in Indian oil firms rose more than 3 percent on the news.
In early June, the Congress-led government held off the decision after two powerful ministers from coalition parties stayed away from a ministerial panel meeting, signalling opposition to the move on fears of voter backlash.
Finance Secretary Ashok Chawla told Reuters this month he expects the fiscal deficit to shrink to 4.5 percent of GDP in fiscal year 2011 if fuel prices are deregulated and on the back of other revenues including the 3G spectrum auction.
Fuel accounts for a quarter of its estimated subsidy bill of 1.2 trillion rupees ($25.5 billion). Before Friday's announcement, projected losses for oil firms are estimated at $24.4 billion this year, based on an average crude price of $85 a barrel.
Congress was handed a second term in office last year on the back of the ruling party's pledge to share the spoils of years of economic boom and protect hundreds of millions living below the poverty line. The government backed out a few months ago on freeing up farm prices after street protests.
Asia's third-largest economy has been eyeing new ways to reduce subsidies since the failure of its 2002 attempt to get state-owned refiners to fix prices every two weeks in step with global rates.
Rival Asian giant China by contrast abandoned similar fuel price subsidies from January 2009 to great effect for then-struggling refiners grappling with losses, as Indian state-owned refiners do now.
A panel of ministers increased prices of state-subsidised diesel, kerosene and cooking gas prices, which could help reduce the fiscal deficit from the projected 5.5 percent of 2010/11 GDP and free up revenues for other programmes.
The panel said petrol prices would be market driven, rising 3.50 rupees per litre, while kerosene prices would rise by 3 rupees a litre. While petrol is mainly used by the middle class for cars, kerosene is used by the poor for power.
Diesel prices will rise 2 rupees per litre and will be freed up in the future. Cooking gas prices were raised by 35 rupees a cylinder.
"It was decided that the price of petrol will be market determined both at the refinery gate and at the retail level," Oil Secretary S. Sundareshan told reporters.
India's benchmark bond yield rose 2 basis points immediately after the news on concerns that the hikes would push up inflation.
The benchmark 5-year swap rate rose 1 basis point to 6.74 percent while the 1-year swap rate rose 2 basis points to 5.50 percent. Shares in Indian oil firms rose more than 3 percent on the news.
In early June, the Congress-led government held off the decision after two powerful ministers from coalition parties stayed away from a ministerial panel meeting, signalling opposition to the move on fears of voter backlash.
Finance Secretary Ashok Chawla told Reuters this month he expects the fiscal deficit to shrink to 4.5 percent of GDP in fiscal year 2011 if fuel prices are deregulated and on the back of other revenues including the 3G spectrum auction.
Fuel accounts for a quarter of its estimated subsidy bill of 1.2 trillion rupees ($25.5 billion). Before Friday's announcement, projected losses for oil firms are estimated at $24.4 billion this year, based on an average crude price of $85 a barrel.
Congress was handed a second term in office last year on the back of the ruling party's pledge to share the spoils of years of economic boom and protect hundreds of millions living below the poverty line. The government backed out a few months ago on freeing up farm prices after street protests.
Asia's third-largest economy has been eyeing new ways to reduce subsidies since the failure of its 2002 attempt to get state-owned refiners to fix prices every two weeks in step with global rates.
Rival Asian giant China by contrast abandoned similar fuel price subsidies from January 2009 to great effect for then-struggling refiners grappling with losses, as Indian state-owned refiners do now.
Thursday, June 24, 2010
Reliance buys 45 pct in U.S. shale gas JV for $1.36 bln
Reliance Industries(RELI.BO) will invest $1.36 billion in the U.S. shale gas assets of Pioneer Natural Resources(PXD.N), its second such investment in as many months as it builds business beyond the Indian energy sector.
Under the agreement, India'a largest listed company will make a cash payment of $263 million for a 45 percent stake in U.S. firm Pioneer's Eagle Ford shale acreage in south Texas. Reliance said it will also contribute $1.052 billion towards drilling costs over four years.
The deal is expected to close within five business days, Pioneer said in a separate statement.
"Reliance has lot of cash and as an investor I would like to see them investing more on getting access to resources like these," said Taina Erajuuri, portfolio manager at FIM India, which owns about $150 million worth of Indian shares in Helsinki.
"It's a step in the right direction for Reliance," she said.
The deal is the second this year in the promising U.S. shale gas sector for Reliance, a petrochemicals-to-refining giant with a market value of $75 billion, making it India's most-valuable company. The deal had been widely expected and Reliance shares were little changed on Thursday.
In April, Reliance agreed to pay $1.7 billion to Atlas Energy (ATLS.O) to form a joint venture and own a 40 percent stake in Atlas' Marcellus Shale operations in the eastern United States.
Under the new agreement, Pioneer will get $1.15 billion and partner Newpek LLC will receive about $210 million. After the deal, Reliance will own 45 percent in the Eagle Ford shale acreage, while Pioneer and Newpek will hold 46 percent and 9 percent respectively.
Last week, Reliance Chairman Mukesh Ambani, the world's fourth-richest man, said his company planned to expand its presence in the U.S. shale gas business, in addition to a foray into India's high-potential power sector and a return to the telecom business.
BULKING UP
Reliance has said it will pursue joint development opportunities with the best operators as well as on its own to build a substantial upstream business in North America.
Companies from around the globe are increasingly investing in U.S. shale plays -- underground rock formations that hold reserves of oil and natural gas.
Shale gas accounts for between 15 percent and 20 percent of U.S. gas production but is expected to quadruple in coming years, touching off a scramble among producers large and small for access to resources.
Based on the joint venture development plan, Pioneer's net production in the Eagle Ford asset will increase to between 32,000 and 41,000 barrels of oil equivalent per day (BOEPD) in 2013, from 2,000 barrels BOEPD in 2010, Pioneer said in a statement.
"This strong production growth, coupled with the up-front cash payment and drilling carry from Reliance, is expected to generate positive cash flow from upstream and midstream activities in all years going forward," it said.
Pioneer plans to increase the drilling program to approximately 140 wells per year within three years.
Reliance will have an option to acquire a 45 percent share in all newly acquired assets by the JV and will also act as development operator in certain areas in coming years.
Reliance said it would also form a separate midstream joint venture with Pioneer to service the exploration and production unit, investing $46 million for a 49.9 percent stake.
Reliance was represented by Barclays and UBS for the deal, while Bank of America Merrill Lynch represented Pioneer.
At 12:45 p.m. (0715 GMT), shares in Reliance, the biggest constituent in the Sensex index, were trading 0.35 percent higher at 1,062.25 rupees in Mumbai, while Pioneer shares closed up 0.33 percent in New York, ahead of the announcement.
Under the agreement, India'a largest listed company will make a cash payment of $263 million for a 45 percent stake in U.S. firm Pioneer's Eagle Ford shale acreage in south Texas. Reliance said it will also contribute $1.052 billion towards drilling costs over four years.
The deal is expected to close within five business days, Pioneer said in a separate statement.
"Reliance has lot of cash and as an investor I would like to see them investing more on getting access to resources like these," said Taina Erajuuri, portfolio manager at FIM India, which owns about $150 million worth of Indian shares in Helsinki.
"It's a step in the right direction for Reliance," she said.
The deal is the second this year in the promising U.S. shale gas sector for Reliance, a petrochemicals-to-refining giant with a market value of $75 billion, making it India's most-valuable company. The deal had been widely expected and Reliance shares were little changed on Thursday.
In April, Reliance agreed to pay $1.7 billion to Atlas Energy (ATLS.O) to form a joint venture and own a 40 percent stake in Atlas' Marcellus Shale operations in the eastern United States.
Under the new agreement, Pioneer will get $1.15 billion and partner Newpek LLC will receive about $210 million. After the deal, Reliance will own 45 percent in the Eagle Ford shale acreage, while Pioneer and Newpek will hold 46 percent and 9 percent respectively.
Last week, Reliance Chairman Mukesh Ambani, the world's fourth-richest man, said his company planned to expand its presence in the U.S. shale gas business, in addition to a foray into India's high-potential power sector and a return to the telecom business.
BULKING UP
Reliance has said it will pursue joint development opportunities with the best operators as well as on its own to build a substantial upstream business in North America.
Companies from around the globe are increasingly investing in U.S. shale plays -- underground rock formations that hold reserves of oil and natural gas.
Shale gas accounts for between 15 percent and 20 percent of U.S. gas production but is expected to quadruple in coming years, touching off a scramble among producers large and small for access to resources.
Based on the joint venture development plan, Pioneer's net production in the Eagle Ford asset will increase to between 32,000 and 41,000 barrels of oil equivalent per day (BOEPD) in 2013, from 2,000 barrels BOEPD in 2010, Pioneer said in a statement.
"This strong production growth, coupled with the up-front cash payment and drilling carry from Reliance, is expected to generate positive cash flow from upstream and midstream activities in all years going forward," it said.
Pioneer plans to increase the drilling program to approximately 140 wells per year within three years.
Reliance will have an option to acquire a 45 percent share in all newly acquired assets by the JV and will also act as development operator in certain areas in coming years.
Reliance said it would also form a separate midstream joint venture with Pioneer to service the exploration and production unit, investing $46 million for a 49.9 percent stake.
Reliance was represented by Barclays and UBS for the deal, while Bank of America Merrill Lynch represented Pioneer.
At 12:45 p.m. (0715 GMT), shares in Reliance, the biggest constituent in the Sensex index, were trading 0.35 percent higher at 1,062.25 rupees in Mumbai, while Pioneer shares closed up 0.33 percent in New York, ahead of the announcement.
Isner beats Mahut 70-68 in final set
WIMBLEDON, England – John Isner has won the longest tennis match on record by beating Nicolas Mahut 70-68 in the final set at Wimbledon.
Picking up at 59-59 in the fifth set Thursday, the match continued on serve with no break points until the American hit a backhand passing shot to finish the contest in front of a packed crowd on Court 18.
Isner finished with a total of 112 aces and Muhat 103.
The first-round match surpassed the 11-hour mark stretching over three days. The fifth set alone went over 8 hours.
Picking up at 59-59 in the fifth set Thursday, the match continued on serve with no break points until the American hit a backhand passing shot to finish the contest in front of a packed crowd on Court 18.
Isner finished with a total of 112 aces and Muhat 103.
The first-round match surpassed the 11-hour mark stretching over three days. The fifth set alone went over 8 hours.
Tuesday, June 22, 2010
Technical Analysis vs Fundamental Analysis
At the most basic level, a technical analyst approaches a security from the charts, while a fundamental analyst starts with the financial statements.
Technical analysis is a method of evaluating securities by analyzing the statistics generated by market activity. It is based on three assumptions:
1) the market discounts everything,
2) price moves in trends and
3) history tends to repeat itself.
Fundamental analysis is about using real data to evaluate a security's value. Although most analysts use fundamental analysis to value stocks, this method of valuation can be used for just about any type of security.
For example, an investor can perform fundamental analysis on a bond's value by looking at economic factors, such as interest rates and the overall state of the economy, and information about the bond issuer, such as potential changes in credit ratings. For assessing stocks, this method uses revenues, earnings, future growth, return on equity, profit margins and other data to determine a company's underlying value and potential for future growth. In terms of stocks, fundamental analysis focuses on the financial statements of the company being evaluated.
Technical analysis is a method of evaluating securities by analyzing the statistics generated by market activity. It is based on three assumptions:
1) the market discounts everything,
2) price moves in trends and
3) history tends to repeat itself.
Fundamental analysis is about using real data to evaluate a security's value. Although most analysts use fundamental analysis to value stocks, this method of valuation can be used for just about any type of security.
For example, an investor can perform fundamental analysis on a bond's value by looking at economic factors, such as interest rates and the overall state of the economy, and information about the bond issuer, such as potential changes in credit ratings. For assessing stocks, this method uses revenues, earnings, future growth, return on equity, profit margins and other data to determine a company's underlying value and potential for future growth. In terms of stocks, fundamental analysis focuses on the financial statements of the company being evaluated.
ULIPs vs Mutual Funds
Unit Linked Insurance Policies (ULIPs) as an investment avenue are closest to mutual funds in terms of their structure and functioning. As is the case with mutual funds, investors in ULIPs are allotted units by the insurance company and a net asset value (NAV) is declared for the same on a daily basis.
Similarly ULIP investors have the option of investing across various schemes similar to the ones found in the mutual funds domain, i.e. diversified equity funds, balanced funds and debt funds to name a few. Generally speaking, ULIPs can be termed as mutual fund schemes with an insurance component.
However it should not be construed that barring the insurance element there is nothing differentiating mutual funds from ULIPs.
How ULIPs can make you RICH!
Despite the seemingly comparable structures there are various factors wherein the two differ.
In this article we evaluate the two avenues on certain common parameters and find out how they measure up.
1. Mode of investment/ investment amounts
Mutual fund investors have the option of either making lump sum investments or investing using the systematic investment plan (SIP) route which entails commitments over longer time horizons. The minimum investment amounts are laid out by the fund house.
ULIP investors also have the choice of investing in a lump sum (single premium) or using the conventional route, i.e. making premium payments on an annual, half-yearly, quarterly or monthly basis. In ULIPs, determining the premium paid is often the starting point for the investment activity.
This is in stark contrast to conventional insurance plans where the sum assured is the starting point and premiums to be paid are determined thereafter.
ULIP investors also have the flexibility to alter the premium amounts during the policy’s tenure. For example an individual with access to surplus funds can enhance the contribution thereby ensuring that his surplus funds are gainfully invested; conversely an individual faced with a liquidity crunch has the option of paying a lower amount (the difference being adjusted in the accumulated value of his ULIP). The freedom to modify premium payments at one’s convenience clearly gives ULIP investors an edge over their mutual fund counterparts.
2. Expenses
In mutual fund investments, expenses charged for various activities like fund management, sales and marketing, administration among others are subject to pre-determined upper limits as prescribed by the Securities and Exchange Board of India.
For example equity-oriented funds can charge their investors a maximum of 2.5% per annum on a recurring basis for all their expenses; any expense above the prescribed limit is borne by the fund house and not the investors.
Similarly funds also charge their investors entry and exit loads (in most cases, either is applicable). Entry loads are charged at the timing of making an investment while the exit load is charged at the time of sale.
Insurance companies have a free hand in levying expenses on their ULIP products with no upper limits being prescribed by the regulator, i.e. the Insurance Regulatory and Development Authority. This explains the complex and at times ‘unwieldy’ expense structures on ULIP offerings. The only restraint placed is that insurers are required to notify the regulator of all the expenses that will be charged on their ULIP offerings.
Expenses can have far-reaching consequences on investors since higher expenses translate into lower amounts being invested and a smaller corpus being accumulated. ULIP-related expenses have been dealt with in detail in the article “Understanding ULIP expenses”.
3. Portfolio disclosure
Mutual fund houses are required to statutorily declare their portfolios on a quarterly basis, albeit most fund houses do so on a monthly basis. Investors get the opportunity to see where their monies are being invested and how they have been managed by studying the portfolio.
There is lack of consensus on whether ULIPs are required to disclose their portfolios. During our interactions with leading insurers we came across divergent views on this issue.
While one school of thought believes that disclosing portfolios on a quarterly basis is mandatory, the other believes that there is no legal obligation to do so and that insurers are required to disclose their portfolios only on demand.
Some insurance companies do declare their portfolios on a monthly/quarterly basis. However the lack of transparency in ULIP investments could be a cause for concern considering that the amount invested in insurance policies is essentially meant to provide for contingencies and for long-term needs like retirement; regular portfolio disclosures on the other hand can enable investors to make timely investment decisions.
4. Flexibility in altering the asset allocation
As was stated earlier, offerings in both the mutual funds segment and ULIPs segment are largely comparable. For example plans that invest their entire corpus in equities (diversified equity funds), a 60:40 allotment in equity and debt instruments (balanced funds) and those investing only in debt instruments (debt funds) can be found in both ULIPs and mutual funds.
If a mutual fund investor in a diversified equity fund wishes to shift his corpus into a debt from the same fund house, he could have to bear an exit load and/or entry load.
On the other hand most insurance companies permit their ULIP inventors to shift investments across various plans/asset classes either at a nominal or no cost (usually, a couple of switches are allowed free of charge every year and a cost has to be borne for additional switches).
Effectively the ULIP investor is given the option to invest across asset classes as per his convenience in a cost-effective manner.
This can prove to be very useful for investors, for example in a bull market when the ULIP investor’s equity component has appreciated, he can book profits by simply transferring the requisite amount to a debt-oriented plan.
5. Tax benefits
ULIP investments qualify for deductions under Section 80C of the Income Tax Act. This holds good, irrespective of the nature of the plan chosen by the investor. On the other hand in the mutual funds domain, only investments in tax-saving funds (also referred to as equity-linked savings schemes) are eligible for Section 80C benefits.
Maturity proceeds from ULIPs are tax free. In case of equity-oriented funds (for example diversified equity funds, balanced funds), if the investments are held for a period over 12 months, the gains are tax free; conversely investments sold within a 12-month period attract short-term capital gains tax @ 10%.
Similarly, debt-oriented funds attract a long-term capital gains tax @ 10%, while a short-term capital gain is taxed at the investor’s marginal tax rate.
Despite the seemingly similar structures evidently both mutual funds and ULIPs have their unique set of advantages to offer. As always, it is vital for investors to be aware of the nuances in both offerings and make informed decisions.
Similarly ULIP investors have the option of investing across various schemes similar to the ones found in the mutual funds domain, i.e. diversified equity funds, balanced funds and debt funds to name a few. Generally speaking, ULIPs can be termed as mutual fund schemes with an insurance component.
However it should not be construed that barring the insurance element there is nothing differentiating mutual funds from ULIPs.
How ULIPs can make you RICH!
Despite the seemingly comparable structures there are various factors wherein the two differ.
In this article we evaluate the two avenues on certain common parameters and find out how they measure up.
1. Mode of investment/ investment amounts
Mutual fund investors have the option of either making lump sum investments or investing using the systematic investment plan (SIP) route which entails commitments over longer time horizons. The minimum investment amounts are laid out by the fund house.
ULIP investors also have the choice of investing in a lump sum (single premium) or using the conventional route, i.e. making premium payments on an annual, half-yearly, quarterly or monthly basis. In ULIPs, determining the premium paid is often the starting point for the investment activity.
This is in stark contrast to conventional insurance plans where the sum assured is the starting point and premiums to be paid are determined thereafter.
ULIP investors also have the flexibility to alter the premium amounts during the policy’s tenure. For example an individual with access to surplus funds can enhance the contribution thereby ensuring that his surplus funds are gainfully invested; conversely an individual faced with a liquidity crunch has the option of paying a lower amount (the difference being adjusted in the accumulated value of his ULIP). The freedom to modify premium payments at one’s convenience clearly gives ULIP investors an edge over their mutual fund counterparts.
2. Expenses
In mutual fund investments, expenses charged for various activities like fund management, sales and marketing, administration among others are subject to pre-determined upper limits as prescribed by the Securities and Exchange Board of India.
For example equity-oriented funds can charge their investors a maximum of 2.5% per annum on a recurring basis for all their expenses; any expense above the prescribed limit is borne by the fund house and not the investors.
Similarly funds also charge their investors entry and exit loads (in most cases, either is applicable). Entry loads are charged at the timing of making an investment while the exit load is charged at the time of sale.
Insurance companies have a free hand in levying expenses on their ULIP products with no upper limits being prescribed by the regulator, i.e. the Insurance Regulatory and Development Authority. This explains the complex and at times ‘unwieldy’ expense structures on ULIP offerings. The only restraint placed is that insurers are required to notify the regulator of all the expenses that will be charged on their ULIP offerings.
Expenses can have far-reaching consequences on investors since higher expenses translate into lower amounts being invested and a smaller corpus being accumulated. ULIP-related expenses have been dealt with in detail in the article “Understanding ULIP expenses”.
3. Portfolio disclosure
Mutual fund houses are required to statutorily declare their portfolios on a quarterly basis, albeit most fund houses do so on a monthly basis. Investors get the opportunity to see where their monies are being invested and how they have been managed by studying the portfolio.
There is lack of consensus on whether ULIPs are required to disclose their portfolios. During our interactions with leading insurers we came across divergent views on this issue.
While one school of thought believes that disclosing portfolios on a quarterly basis is mandatory, the other believes that there is no legal obligation to do so and that insurers are required to disclose their portfolios only on demand.
Some insurance companies do declare their portfolios on a monthly/quarterly basis. However the lack of transparency in ULIP investments could be a cause for concern considering that the amount invested in insurance policies is essentially meant to provide for contingencies and for long-term needs like retirement; regular portfolio disclosures on the other hand can enable investors to make timely investment decisions.
4. Flexibility in altering the asset allocation
As was stated earlier, offerings in both the mutual funds segment and ULIPs segment are largely comparable. For example plans that invest their entire corpus in equities (diversified equity funds), a 60:40 allotment in equity and debt instruments (balanced funds) and those investing only in debt instruments (debt funds) can be found in both ULIPs and mutual funds.
If a mutual fund investor in a diversified equity fund wishes to shift his corpus into a debt from the same fund house, he could have to bear an exit load and/or entry load.
On the other hand most insurance companies permit their ULIP inventors to shift investments across various plans/asset classes either at a nominal or no cost (usually, a couple of switches are allowed free of charge every year and a cost has to be borne for additional switches).
Effectively the ULIP investor is given the option to invest across asset classes as per his convenience in a cost-effective manner.
This can prove to be very useful for investors, for example in a bull market when the ULIP investor’s equity component has appreciated, he can book profits by simply transferring the requisite amount to a debt-oriented plan.
5. Tax benefits
ULIP investments qualify for deductions under Section 80C of the Income Tax Act. This holds good, irrespective of the nature of the plan chosen by the investor. On the other hand in the mutual funds domain, only investments in tax-saving funds (also referred to as equity-linked savings schemes) are eligible for Section 80C benefits.
Maturity proceeds from ULIPs are tax free. In case of equity-oriented funds (for example diversified equity funds, balanced funds), if the investments are held for a period over 12 months, the gains are tax free; conversely investments sold within a 12-month period attract short-term capital gains tax @ 10%.
Similarly, debt-oriented funds attract a long-term capital gains tax @ 10%, while a short-term capital gain is taxed at the investor’s marginal tax rate.
Despite the seemingly similar structures evidently both mutual funds and ULIPs have their unique set of advantages to offer. As always, it is vital for investors to be aware of the nuances in both offerings and make informed decisions.
ULIPs vs Mutual Funds
Unit Linked Insurance Policies (ULIPs) as an investment avenue are closest to mutual funds in terms of their structure and functioning. As is the case with mutual funds, investors in ULIPs are allotted units by the insurance company and a net asset value (NAV) is declared for the same on a daily basis.
Similarly ULIP investors have the option of investing across various schemes similar to the ones found in the mutual funds domain, i.e. diversified equity funds, balanced funds and debt funds to name a few. Generally speaking, ULIPs can be termed as mutual fund schemes with an insurance component.
However it should not be construed that barring the insurance element there is nothing differentiating mutual funds from ULIPs.
How ULIPs can make you RICH!
Despite the seemingly comparable structures there are various factors wherein the two differ.
In this article we evaluate the two avenues on certain common parameters and find out how they measure up.
1. Mode of investment/ investment amounts
Mutual fund investors have the option of either making lump sum investments or investing using the systematic investment plan (SIP) route which entails commitments over longer time horizons. The minimum investment amounts are laid out by the fund house.
ULIP investors also have the choice of investing in a lump sum (single premium) or using the conventional route, i.e. making premium payments on an annual, half-yearly, quarterly or monthly basis. In ULIPs, determining the premium paid is often the starting point for the investment activity.
This is in stark contrast to conventional insurance plans where the sum assured is the starting point and premiums to be paid are determined thereafter.
ULIP investors also have the flexibility to alter the premium amounts during the policy’s tenure. For example an individual with access to surplus funds can enhance the contribution thereby ensuring that his surplus funds are gainfully invested; conversely an individual faced with a liquidity crunch has the option of paying a lower amount (the difference being adjusted in the accumulated value of his ULIP). The freedom to modify premium payments at one’s convenience clearly gives ULIP investors an edge over their mutual fund counterparts.
2. Expenses
In mutual fund investments, expenses charged for various activities like fund management, sales and marketing, administration among others are subject to pre-determined upper limits as prescribed by the Securities and Exchange Board of India.
For example equity-oriented funds can charge their investors a maximum of 2.5% per annum on a recurring basis for all their expenses; any expense above the prescribed limit is borne by the fund house and not the investors.
Similarly funds also charge their investors entry and exit loads (in most cases, either is applicable). Entry loads are charged at the timing of making an investment while the exit load is charged at the time of sale.
Insurance companies have a free hand in levying expenses on their ULIP products with no upper limits being prescribed by the regulator, i.e. the Insurance Regulatory and Development Authority. This explains the complex and at times ‘unwieldy’ expense structures on ULIP offerings. The only restraint placed is that insurers are required to notify the regulator of all the expenses that will be charged on their ULIP offerings.
Expenses can have far-reaching consequences on investors since higher expenses translate into lower amounts being invested and a smaller corpus being accumulated. ULIP-related expenses have been dealt with in detail in the article “Understanding ULIP expenses”.
3. Portfolio disclosure
Mutual fund houses are required to statutorily declare their portfolios on a quarterly basis, albeit most fund houses do so on a monthly basis. Investors get the opportunity to see where their monies are being invested and how they have been managed by studying the portfolio.
There is lack of consensus on whether ULIPs are required to disclose their portfolios. During our interactions with leading insurers we came across divergent views on this issue.
While one school of thought believes that disclosing portfolios on a quarterly basis is mandatory, the other believes that there is no legal obligation to do so and that insurers are required to disclose their portfolios only on demand.
Some insurance companies do declare their portfolios on a monthly/quarterly basis. However the lack of transparency in ULIP investments could be a cause for concern considering that the amount invested in insurance policies is essentially meant to provide for contingencies and for long-term needs like retirement; regular portfolio disclosures on the other hand can enable investors to make timely investment decisions.
4. Flexibility in altering the asset allocation
As was stated earlier, offerings in both the mutual funds segment and ULIPs segment are largely comparable. For example plans that invest their entire corpus in equities (diversified equity funds), a 60:40 allotment in equity and debt instruments (balanced funds) and those investing only in debt instruments (debt funds) can be found in both ULIPs and mutual funds.
If a mutual fund investor in a diversified equity fund wishes to shift his corpus into a debt from the same fund house, he could have to bear an exit load and/or entry load.
On the other hand most insurance companies permit their ULIP inventors to shift investments across various plans/asset classes either at a nominal or no cost (usually, a couple of switches are allowed free of charge every year and a cost has to be borne for additional switches).
Effectively the ULIP investor is given the option to invest across asset classes as per his convenience in a cost-effective manner.
This can prove to be very useful for investors, for example in a bull market when the ULIP investor’s equity component has appreciated, he can book profits by simply transferring the requisite amount to a debt-oriented plan.
5. Tax benefits
ULIP investments qualify for deductions under Section 80C of the Income Tax Act. This holds good, irrespective of the nature of the plan chosen by the investor. On the other hand in the mutual funds domain, only investments in tax-saving funds (also referred to as equity-linked savings schemes) are eligible for Section 80C benefits.
Maturity proceeds from ULIPs are tax free. In case of equity-oriented funds (for example diversified equity funds, balanced funds), if the investments are held for a period over 12 months, the gains are tax free; conversely investments sold within a 12-month period attract short-term capital gains tax @ 10%.
Similarly, debt-oriented funds attract a long-term capital gains tax @ 10%, while a short-term capital gain is taxed at the investor’s marginal tax rate.
Despite the seemingly similar structures evidently both mutual funds and ULIPs have their unique set of advantages to offer. As always, it is vital for investors to be aware of the nuances in both offerings and make informed decisions.
Similarly ULIP investors have the option of investing across various schemes similar to the ones found in the mutual funds domain, i.e. diversified equity funds, balanced funds and debt funds to name a few. Generally speaking, ULIPs can be termed as mutual fund schemes with an insurance component.
However it should not be construed that barring the insurance element there is nothing differentiating mutual funds from ULIPs.
How ULIPs can make you RICH!
Despite the seemingly comparable structures there are various factors wherein the two differ.
In this article we evaluate the two avenues on certain common parameters and find out how they measure up.
1. Mode of investment/ investment amounts
Mutual fund investors have the option of either making lump sum investments or investing using the systematic investment plan (SIP) route which entails commitments over longer time horizons. The minimum investment amounts are laid out by the fund house.
ULIP investors also have the choice of investing in a lump sum (single premium) or using the conventional route, i.e. making premium payments on an annual, half-yearly, quarterly or monthly basis. In ULIPs, determining the premium paid is often the starting point for the investment activity.
This is in stark contrast to conventional insurance plans where the sum assured is the starting point and premiums to be paid are determined thereafter.
ULIP investors also have the flexibility to alter the premium amounts during the policy’s tenure. For example an individual with access to surplus funds can enhance the contribution thereby ensuring that his surplus funds are gainfully invested; conversely an individual faced with a liquidity crunch has the option of paying a lower amount (the difference being adjusted in the accumulated value of his ULIP). The freedom to modify premium payments at one’s convenience clearly gives ULIP investors an edge over their mutual fund counterparts.
2. Expenses
In mutual fund investments, expenses charged for various activities like fund management, sales and marketing, administration among others are subject to pre-determined upper limits as prescribed by the Securities and Exchange Board of India.
For example equity-oriented funds can charge their investors a maximum of 2.5% per annum on a recurring basis for all their expenses; any expense above the prescribed limit is borne by the fund house and not the investors.
Similarly funds also charge their investors entry and exit loads (in most cases, either is applicable). Entry loads are charged at the timing of making an investment while the exit load is charged at the time of sale.
Insurance companies have a free hand in levying expenses on their ULIP products with no upper limits being prescribed by the regulator, i.e. the Insurance Regulatory and Development Authority. This explains the complex and at times ‘unwieldy’ expense structures on ULIP offerings. The only restraint placed is that insurers are required to notify the regulator of all the expenses that will be charged on their ULIP offerings.
Expenses can have far-reaching consequences on investors since higher expenses translate into lower amounts being invested and a smaller corpus being accumulated. ULIP-related expenses have been dealt with in detail in the article “Understanding ULIP expenses”.
3. Portfolio disclosure
Mutual fund houses are required to statutorily declare their portfolios on a quarterly basis, albeit most fund houses do so on a monthly basis. Investors get the opportunity to see where their monies are being invested and how they have been managed by studying the portfolio.
There is lack of consensus on whether ULIPs are required to disclose their portfolios. During our interactions with leading insurers we came across divergent views on this issue.
While one school of thought believes that disclosing portfolios on a quarterly basis is mandatory, the other believes that there is no legal obligation to do so and that insurers are required to disclose their portfolios only on demand.
Some insurance companies do declare their portfolios on a monthly/quarterly basis. However the lack of transparency in ULIP investments could be a cause for concern considering that the amount invested in insurance policies is essentially meant to provide for contingencies and for long-term needs like retirement; regular portfolio disclosures on the other hand can enable investors to make timely investment decisions.
4. Flexibility in altering the asset allocation
As was stated earlier, offerings in both the mutual funds segment and ULIPs segment are largely comparable. For example plans that invest their entire corpus in equities (diversified equity funds), a 60:40 allotment in equity and debt instruments (balanced funds) and those investing only in debt instruments (debt funds) can be found in both ULIPs and mutual funds.
If a mutual fund investor in a diversified equity fund wishes to shift his corpus into a debt from the same fund house, he could have to bear an exit load and/or entry load.
On the other hand most insurance companies permit their ULIP inventors to shift investments across various plans/asset classes either at a nominal or no cost (usually, a couple of switches are allowed free of charge every year and a cost has to be borne for additional switches).
Effectively the ULIP investor is given the option to invest across asset classes as per his convenience in a cost-effective manner.
This can prove to be very useful for investors, for example in a bull market when the ULIP investor’s equity component has appreciated, he can book profits by simply transferring the requisite amount to a debt-oriented plan.
5. Tax benefits
ULIP investments qualify for deductions under Section 80C of the Income Tax Act. This holds good, irrespective of the nature of the plan chosen by the investor. On the other hand in the mutual funds domain, only investments in tax-saving funds (also referred to as equity-linked savings schemes) are eligible for Section 80C benefits.
Maturity proceeds from ULIPs are tax free. In case of equity-oriented funds (for example diversified equity funds, balanced funds), if the investments are held for a period over 12 months, the gains are tax free; conversely investments sold within a 12-month period attract short-term capital gains tax @ 10%.
Similarly, debt-oriented funds attract a long-term capital gains tax @ 10%, while a short-term capital gain is taxed at the investor’s marginal tax rate.
Despite the seemingly similar structures evidently both mutual funds and ULIPs have their unique set of advantages to offer. As always, it is vital for investors to be aware of the nuances in both offerings and make informed decisions.
50 रु. में बोलने वाला कुत्ता लेंगे
एक आदमी ने नया-नया कुत्ता ख़रीदा था, लेकिन चार-छह दिनों बाद ही वह कुत्ता लेकर अपने पड़ोसी के पास पहुंच गया और उससे उसे ख़रीदने के लिए चिरौरी करने लगा। उसने कहा, ‘यह बोलने वाला कुत्ता है।’ पड़ोसी को बिल्कुल भी विश्वास नहीं हुआ। वह आदमी बोला, ‘और आप इसे सिर्फ़ पचास रुपए में ख़रीद सकते हैं।’ अब तो पड़ोसी को पक्का यक़ीन हो गया कि वह उससे मÊाक़ कर रहा है। उसने कहा, ‘मÊाक़ करने के लिए क्या मैं ही मिला था?
दुनिया में कोई भी कुत्ता भौंकने के अलावा और कुछ नहीं बोल सकता।’ पड़ोसी का इतना कहना था कि कुत्ते ने आंखों में आंसू भरकर गिड़गिड़ाते हुए बोलना शुरू कर दिया, ‘प्लीÊा, मुझे ख़रीद लीजिए सर! मेरा मालिक तो पूरा कसाई है। यह न तो मुझे ढंग से खाने को देता है, न ही बाहर निकलने देता है। यह मुझे नहलाता-धुलाता तक नहीं है।’ अपने कुत्ते की ये बातें सुनकर उसके मालिक का ग़ुस्सा सातवें आसमान पर पहुंच गया। उसने कहा, ‘देखा आपने, इसीलिए मैं इसे बेचना चाहता हूं।’
मालिक की प्रतिक्रिया से बेपरवाह, कुत्ते ने बोलना जारी रखा, ‘और सर, मेरी यह दुर्गति तब है, जबकि मैं दुनिया का सबसे शानदार कुत्ता हूं। इससे पहले मैं बिल गेट्स और मुकेश अंबानी जैसे मालिकों के साथ उनके बेडरूम में सोता था। मेरी सेवा-चाकरी के लिए दसियों नौकर-चाकर लगे रहते थे। और आज..आज इस आदमी ने मेरी यह दुर्गति कर दी है।’
बोलते कुत्ते की कहानी से हैरान पड़ोसी उसके मालिक को लताड़ने के अंदाÊा में बोला, ‘सचमुच! यह तो बोलने वाला कुत्ता है। बेचारा। आपने इतने शानदार कुत्ते की यह गत बना दी है!’ पड़ोसी की बात पर मालिक ने अपने पालतू को खा जाने वाली निगाहों से देखा और दांत पीसते हुए बोला, ‘इसी कारण..इसी कारण मैं इस स्साले कुत्ते को पचास रुपए में बेच रहा हूं। मैं इस झुठल्ले की ऐसी ही मनगढ़ंत बातों से तंग आ चुका हूं।’
सबक़ : झूठ बोलने वाले, लंबी-लंबी फेंकने वाले की क़ीमत दो कौड़ी की भी नहीं रह जाती, चाहे कुत्ता हो या इंसान। व्यक्ति के झूठ के कारण उसकी अच्छे से अच्छी प्रतिभा पर भी पानी फिर जाता है
दुनिया में कोई भी कुत्ता भौंकने के अलावा और कुछ नहीं बोल सकता।’ पड़ोसी का इतना कहना था कि कुत्ते ने आंखों में आंसू भरकर गिड़गिड़ाते हुए बोलना शुरू कर दिया, ‘प्लीÊा, मुझे ख़रीद लीजिए सर! मेरा मालिक तो पूरा कसाई है। यह न तो मुझे ढंग से खाने को देता है, न ही बाहर निकलने देता है। यह मुझे नहलाता-धुलाता तक नहीं है।’ अपने कुत्ते की ये बातें सुनकर उसके मालिक का ग़ुस्सा सातवें आसमान पर पहुंच गया। उसने कहा, ‘देखा आपने, इसीलिए मैं इसे बेचना चाहता हूं।’
मालिक की प्रतिक्रिया से बेपरवाह, कुत्ते ने बोलना जारी रखा, ‘और सर, मेरी यह दुर्गति तब है, जबकि मैं दुनिया का सबसे शानदार कुत्ता हूं। इससे पहले मैं बिल गेट्स और मुकेश अंबानी जैसे मालिकों के साथ उनके बेडरूम में सोता था। मेरी सेवा-चाकरी के लिए दसियों नौकर-चाकर लगे रहते थे। और आज..आज इस आदमी ने मेरी यह दुर्गति कर दी है।’
बोलते कुत्ते की कहानी से हैरान पड़ोसी उसके मालिक को लताड़ने के अंदाÊा में बोला, ‘सचमुच! यह तो बोलने वाला कुत्ता है। बेचारा। आपने इतने शानदार कुत्ते की यह गत बना दी है!’ पड़ोसी की बात पर मालिक ने अपने पालतू को खा जाने वाली निगाहों से देखा और दांत पीसते हुए बोला, ‘इसी कारण..इसी कारण मैं इस स्साले कुत्ते को पचास रुपए में बेच रहा हूं। मैं इस झुठल्ले की ऐसी ही मनगढ़ंत बातों से तंग आ चुका हूं।’
सबक़ : झूठ बोलने वाले, लंबी-लंबी फेंकने वाले की क़ीमत दो कौड़ी की भी नहीं रह जाती, चाहे कुत्ता हो या इंसान। व्यक्ति के झूठ के कारण उसकी अच्छे से अच्छी प्रतिभा पर भी पानी फिर जाता है
एक और नई शुरुआत करें
अमरीका के थॉमस अल्वा एडिसन इतिहास के सबसे प्रतिभाशाली वैज्ञानिकों में शुमार होते हैं, जिनके बनाए बिजली के बल्ब ने पूरी दुनिया को नई रोशनी दी। एडिसन के नाम अकेले अमरीका में ही 1,093 आविष्कारों के पेटेंट हैं।
यह 1914 के दिसंबर महीने की बात है। एडिसन की फैक्टरीनुमा प्रयोगशाला में आग लग गई और वह लगभग पूरी तरह से तबाह हो गई। एडिसन के 24 वर्षीय बेटे चाल्र्स को ध्यान आया कि उसके पिता कहीं नजर नहीं आ रहे हैं। वह धुएं और उड़ती राख़ के बीच उन्हें पागलों की तरह तलाश रहा था।
आख़िर उसने उन्हें, अपने पिता थॉमस अल्वा एडिसन को खोज निकाला। लपटों की रोशनी में उनका चेहरा चमक रहा था। वे तब 67 साल के थे। जवानी उनसे बहुत दूर जा चुकी थी। और हर चीÊा आग की भेंट चढ़ चुकी थी।
चाल्र्स को देखते ही एडिसन चिल्लाए, ‘चाल्र्स तुम्हारी मां कहां हैं?’
चाल्र्स ने जब बताया कि उसे नहीं मालूम, तो उन्होंने कहा, ‘उन्हें ढूंढ़ कर यहां ले आओ। तुम्हारी मां ने अपने पूरे जीवन में ऐसा नÊारा नहीं देखा होगा!’
अगली सुबह तक आग की लपटें ठंडी हो गईं, पर उससे पहले सबकुछ बर्बाद कर गई थीं। फैक्टरी की खंडहर हो चुकी इमारत को देखते हुए एडिसन बोले, ‘ऐसी तबाही का भी बहुत महत्व है। हमारी सारी ग़लतियां जलकर खाक हो जाती हैं। भगवान का शुक्र है कि अब हम नई शुरुआत कर सकते हैं।’
और इस भीषण अग्निकांड के महज तीन ह़फ्ते बाद ही एडिसन ने फोनोग्राफ का आविष्कार कर दिखाया।
जो बीत गया, चला गया, उसका दुख मनाने से क्या फ़ायदा? हर दिन एक नया दिन होता है और किसी भी दिन, किसी भी आयु में, किसी भी परिस्थिति में जीवन की नई शुरुआत हो सकती है
यह 1914 के दिसंबर महीने की बात है। एडिसन की फैक्टरीनुमा प्रयोगशाला में आग लग गई और वह लगभग पूरी तरह से तबाह हो गई। एडिसन के 24 वर्षीय बेटे चाल्र्स को ध्यान आया कि उसके पिता कहीं नजर नहीं आ रहे हैं। वह धुएं और उड़ती राख़ के बीच उन्हें पागलों की तरह तलाश रहा था।
आख़िर उसने उन्हें, अपने पिता थॉमस अल्वा एडिसन को खोज निकाला। लपटों की रोशनी में उनका चेहरा चमक रहा था। वे तब 67 साल के थे। जवानी उनसे बहुत दूर जा चुकी थी। और हर चीÊा आग की भेंट चढ़ चुकी थी।
चाल्र्स को देखते ही एडिसन चिल्लाए, ‘चाल्र्स तुम्हारी मां कहां हैं?’
चाल्र्स ने जब बताया कि उसे नहीं मालूम, तो उन्होंने कहा, ‘उन्हें ढूंढ़ कर यहां ले आओ। तुम्हारी मां ने अपने पूरे जीवन में ऐसा नÊारा नहीं देखा होगा!’
अगली सुबह तक आग की लपटें ठंडी हो गईं, पर उससे पहले सबकुछ बर्बाद कर गई थीं। फैक्टरी की खंडहर हो चुकी इमारत को देखते हुए एडिसन बोले, ‘ऐसी तबाही का भी बहुत महत्व है। हमारी सारी ग़लतियां जलकर खाक हो जाती हैं। भगवान का शुक्र है कि अब हम नई शुरुआत कर सकते हैं।’
और इस भीषण अग्निकांड के महज तीन ह़फ्ते बाद ही एडिसन ने फोनोग्राफ का आविष्कार कर दिखाया।
जो बीत गया, चला गया, उसका दुख मनाने से क्या फ़ायदा? हर दिन एक नया दिन होता है और किसी भी दिन, किसी भी आयु में, किसी भी परिस्थिति में जीवन की नई शुरुआत हो सकती है
सबसे क़ीमती क्या पिता के लिए?
एक धनी पिता-पुत्र को चित्रकला से बहुत लगाव था। वे सारी दुनिया में घूमते और हर जगह के जाने-माने चित्रकारों की कृतियां ख़रीदकर घर ले आते। एक बार पुत्र को मातृभूमि की रक्षा की ख़ातिर मोर्चे पर जाना पड़ा, लेकिन वहां से वह वापस नहीं लौटा, उसकी मौत की ख़बर ही आई। पिता अब इस दुनिया में अकेला था। उसके लिए सारा कला-संग्रह बेमानी हो गया था। एक दिन उसके बेटे के दोस्त ने दरवाजे पर दस्तक दी।
वह पिता के लिए उसके बेटे का पोर्ट्रेट उपहार में लाया था, जिसे उसने ख़ुद बनाया था। पेंटिंग देखकर पिता को लगा कि उसका पुत्र वापस आ गया है। लेकिन उसके जीवन का अकेलापन कम न हुआ। कुछ दिनों बाद पिता की मौत हो गई। और कुछ दिनों बाद उसकी वसीयत के अनुसार उसके संग्रह के तमाम चित्रों की नीलामी हो रही थी। लोग महान चित्रकारों की कृतियां ख़रीदने को उत्सुक थे।
लेकिन नीलामीकर्ता ने बोली शुरू की बेटे के पोर्ट्रेट से, जिसे ख़रीदने को कोई उत्सुक न था। लोग तो पिकासो, वान गॉग, मॉने वग़ैरह की कृतियां लेना चाहते थे। शोर-शराबा बढ़ गया। आख़िर पिता के एक दोस्त ने सिर्फ़ 500 रुपए में वह पोर्ट्रेट ख़रीद लिया।
अब लोग सतर्क हो गए। सबको लगा कि अब प्रसिद्ध कृतियों की नीलामी होगी, नीलामी समाप्त होने की घोषणा से उन्हें बड़ा आश्चर्य हुआ। जब वे आपत्ति करने लगे, तो नीलामीकर्ता ने बताया कि पिता की वसीयत के अनुसार, जो व्यक्ति उसके पुत्र के चित्र को ख़रीदेगा, उसे शेष सारी कृतियां मु़फ्त में दे दी जाएंगी। और किसी भी क़ीमत पर उन कृतियों को ख़रीदने के लिए खड़े लोग यह जानकर हैरत में पड़ गए। जाहिर है, किसी भी पिता के लिए उसका पुत्र सबसे क़ीमती होता है।
पिता के लिए सबसे अहम, सबसे क़ीमती होती है संतान। संतान की बेहतरी के लिए पिता सबकुछ कुर्बान कर सकता है, उसकी रक्षा के लिए कुछ भी कर सकता है
वह पिता के लिए उसके बेटे का पोर्ट्रेट उपहार में लाया था, जिसे उसने ख़ुद बनाया था। पेंटिंग देखकर पिता को लगा कि उसका पुत्र वापस आ गया है। लेकिन उसके जीवन का अकेलापन कम न हुआ। कुछ दिनों बाद पिता की मौत हो गई। और कुछ दिनों बाद उसकी वसीयत के अनुसार उसके संग्रह के तमाम चित्रों की नीलामी हो रही थी। लोग महान चित्रकारों की कृतियां ख़रीदने को उत्सुक थे।
लेकिन नीलामीकर्ता ने बोली शुरू की बेटे के पोर्ट्रेट से, जिसे ख़रीदने को कोई उत्सुक न था। लोग तो पिकासो, वान गॉग, मॉने वग़ैरह की कृतियां लेना चाहते थे। शोर-शराबा बढ़ गया। आख़िर पिता के एक दोस्त ने सिर्फ़ 500 रुपए में वह पोर्ट्रेट ख़रीद लिया।
अब लोग सतर्क हो गए। सबको लगा कि अब प्रसिद्ध कृतियों की नीलामी होगी, नीलामी समाप्त होने की घोषणा से उन्हें बड़ा आश्चर्य हुआ। जब वे आपत्ति करने लगे, तो नीलामीकर्ता ने बताया कि पिता की वसीयत के अनुसार, जो व्यक्ति उसके पुत्र के चित्र को ख़रीदेगा, उसे शेष सारी कृतियां मु़फ्त में दे दी जाएंगी। और किसी भी क़ीमत पर उन कृतियों को ख़रीदने के लिए खड़े लोग यह जानकर हैरत में पड़ गए। जाहिर है, किसी भी पिता के लिए उसका पुत्र सबसे क़ीमती होता है।
पिता के लिए सबसे अहम, सबसे क़ीमती होती है संतान। संतान की बेहतरी के लिए पिता सबकुछ कुर्बान कर सकता है, उसकी रक्षा के लिए कुछ भी कर सकता है
Monday, June 21, 2010
Trading Tips for Beginner
Start with Paper Trade. You must be thinking what is Paper Trade or Paper trading. Actually it is Simulated trading that investors use to practice mimicking trades (buys and sells) without actually entering into any monetary transactions. Paper trading is a good way to learn the ropes without risking any money. You can do it simply by pretending to buy and sell stock, bonds, commodities and mutual funds and keeping notes of paper profits or losses. Or you can open an account with an online market simulator.
Sunday, June 20, 2010
BILL GATES' SPEECH TO MT. WHITNEY HIGH SCHOOL in Visalia, California.
Whether you like Bill Gates or not...this is pretty
cool. Here's some advice Bill Gates recently dished out
at a high school speech about 11 things they did not
learn in school. He talks about how feel-good,
politically correct teaching has created a full
generation of kids with no concept of reality and how
this concept sets them up for failure in the real
world.
RULE 1
Life is not fair - get used to it.
RULE 2
The world won't care about your self-esteem. The world
will expect you to accomplish something BEFORE you feel
good about yourself.
RULE 3
You will NOT make 40 thousand dollars a year right out
of high school. You won't be a vice president with
car phone, until you earn both.
RULE 4
If you think your teacher is tough, wait till you get a
boss. He doesn't have tenure.
RULE 5
Flipping burgers is not beneath your dignity. Your
grandparents had a different word for burger flipping
they
called it Opportunity.
RULE 6
If you mess up,it's not your parents' fault, so don't
whine about your mistakes, learn from them.
RULE 7
Before you were born, your parents weren't as boring as
they are now. They got that way from paying your bills,
cleaning your clothes and listening to you talk about
how cool you are. So before you save the rain forest
from the parasites of your parent's generation, try
delousing the closet in your own room.
RULE 8
Your school may have done away with winners and losers,
but life has not. In some schools they have abolished
failing grades and they'll give you as many times as
you want to get the right answer. This doesn't bear the
slightest resemblance to ANYTHING in real life.
RULE 9
Life is not divided into semesters. You don't get
summers off and very few employers are interested in
helping you find yourself. Do that on your own time.
RULE 10
Television is NOT real life. In real life people
actually have to leave the coffee shop and go to jobs.
RULE 11
Be nice to nerds. Chances are you'll end up working for
one.
cool. Here's some advice Bill Gates recently dished out
at a high school speech about 11 things they did not
learn in school. He talks about how feel-good,
politically correct teaching has created a full
generation of kids with no concept of reality and how
this concept sets them up for failure in the real
world.
RULE 1
Life is not fair - get used to it.
RULE 2
The world won't care about your self-esteem. The world
will expect you to accomplish something BEFORE you feel
good about yourself.
RULE 3
You will NOT make 40 thousand dollars a year right out
of high school. You won't be a vice president with
car phone, until you earn both.
RULE 4
If you think your teacher is tough, wait till you get a
boss. He doesn't have tenure.
RULE 5
Flipping burgers is not beneath your dignity. Your
grandparents had a different word for burger flipping
they
called it Opportunity.
RULE 6
If you mess up,it's not your parents' fault, so don't
whine about your mistakes, learn from them.
RULE 7
Before you were born, your parents weren't as boring as
they are now. They got that way from paying your bills,
cleaning your clothes and listening to you talk about
how cool you are. So before you save the rain forest
from the parasites of your parent's generation, try
delousing the closet in your own room.
RULE 8
Your school may have done away with winners and losers,
but life has not. In some schools they have abolished
failing grades and they'll give you as many times as
you want to get the right answer. This doesn't bear the
slightest resemblance to ANYTHING in real life.
RULE 9
Life is not divided into semesters. You don't get
summers off and very few employers are interested in
helping you find yourself. Do that on your own time.
RULE 10
Television is NOT real life. In real life people
actually have to leave the coffee shop and go to jobs.
RULE 11
Be nice to nerds. Chances are you'll end up working for
one.
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