Why This Might be the Right Time to Invest in FDs and Debt Instruments

The Reserve Bank of India has been in the news for continuously raising interest rates - as much as 13 times in 19 months, trying hard to control inflation which seemed to be unaffected by  these interest hikes! People who had taken loans had to face a hike in their EMIs almost every 2 months & groaned at every instance of rate hike. High interest rates coupled with global uncertainties, put brakes on the high growth rates that India was exhibiting and all industries were up in arms against the rate hikes that RBI was bringing about. However last week RBI announced a cut in the CRR  which is a signal that RBI has now decided to soften its stand. Though it has left interest rates unchanged, the CRR cut would infuse more liquidity in to the economy which came as a welcome relief to the industries & the stock market.

But what does this mean for a retail investor?

Is this the January Effect?

At the close of 2011, most financial markets closed on a pessimistic note. The stock market had suffered during the year, and the rupee had tumbled over the last few months. Two weeks into the New Year, the mood and sentiment have changed for the better. Internationally, the markets have fared well. The S&P 500 is up 3% for the year, the Eurozone debt crisis has yet to make new headlines. Commodities have also performed well. Back home, the Sensex is up 4% this year, and the rupee is up by 3% against the dollar. 

The reason could be attributed to a well-documented phenomenon in financial markets is what is known as the January effect.(No, I'm not making this up!).

4 Facts your Broker or Adviser won't tell you

You and your broker (or financial consultant or insurance agent) have different interests. They have to sell things to make a living. The more they sell, and the more expensive the products, the better off they'll be. Irrespective of what they claim, like any other salesperson - for shoes, cameras, advertising or high-tech medical devices - moving products is their job. Your job, as a customer, is to look skeptically at those products, ask yourself if you need them, compare them with other options and consider the cost.

Here are 4 facts your broker/adviser will not tell you but you really need to know:

Choosing Between Dividend & Growth Option

When buying a Mutual Fund, the question which several investors are faced with is 'Should I take the dividend payout option or should I select the growth option?' There are varying views to this question with different mutual fund agents giving various arguments in favour of one of these depending on their fund house marketing objectives. Here is a look at which one would make sense for a retail investor looking at investing money in a mutual fund.