Here are events that shook world in 2013

In the beginning of the year, the safest asset – gold, after having a decade long bull run, saw weakness but in April gold prices (in Indian Rupees) came down more than 20 percent from their peak.

Read more at http://www.moneycontrol.com/news/investing/hereevents-that-shook-world2013_1008775.html

Do you foresee risks properly in your decisions?

An ideal approach is to rebalance the portfolio to a pre-decided asset allocation. This means, one would have booked profit in an asset class where the prices appreciated and added more to the one that had underperformed.

Read more at: http://www.moneycontrol.com/news/mf-experts/do-you-foresee-risks-properly-your-decisions-_978276.html?utm_source=ref_article

Coming soon: An equity market rally that everyone missed

Almost 18 percent return over a five-year period is not bad at all. Can such a performance qualify to be called a bull market? If that is the case, did we all miss this rally?, asks Amit Trivedi of Karmayog Knowledge Academy.



http://www.moneycontrol.com/news/mf-experts/coming-soonequity-market-rally-that-everyone-missed_973327.html#discontent_div

Here's how you can be a good investor

Amit Trivedi of Karmayog Knowledge Academy lists out effective ways one can be a good investor in any economic scenario. He elaborates on how to go about in times when the rupee has depreciated to new lows. ...
http://www.moneycontrol.com/news/investing/heres-how-you-can-begood-investor_940116.html

Carnage in Liquid Funds Explained

Liquid fund NAVs do not drop, since their primary source of return is accrued interest. What happened on July 16^th? 

Read on ...

Blog post on www.ciel.co.in - jointly written with Dr. Uma Shashikant

Looking to invest abroad? Here are few investment options

One can make the most of the depreciating rupee by investing in securities that invests in global market. Read this space to know various international investment options available in the market and what are the terms attached to it.

To read further, click on the link below ...

http://www.moneycontrol.com/news/mf-experts/looking-to-invest-aboardhere-few-investment-options_904275.html

Market ups and downs: an opportunity to meet your clients

Markets ups and downs: an opportunity to meet your clients

Rupee at 58 to a dollar, what should you do?

Rupee at its low against dollar! But how does this impact your investments? Financial expert Amit Trivedi analysis the impact of deprecating rupee on four essentials of the personal finances: assets, liabilities, income and expenses and advices investors on what steps should be taken in current scenario. 

Click on the link below to read more ...

http://www.moneycontrol.com/news/mf-experts/rupee-at-58-todollarshould-you-do_900893.html

Two Important Questions Prior to Setting up a Business

The other day, in one of the TiE sessions, Devita Saraf of Vu Technologies gave a brilliant piece of advice. When someone asked her how an entrepreneur can decide whether to start a particular business, she said, “Ask yourself two questions: (1) is there a gap in the market? and (2) is there enough market in the gap?”

Brilliant insight.

An entrepreneur faces various questions at different phases in the business.

·      A start-up needs to decide which business to get into

·      A business may need to diversify into related or unrelated lines

·      A business might need to decide whether to expand the product line or enter a new geographical market

On all these occasions, the entrepreneur must take a decision since the resources available may be limited. Or, there could be another opportunity to deploy the same resources.

Let us understand how the two questions help take a good decision. What would be the consequences of the decisions taken?

Is there a gap in the market?

If the answer is negative, you will need to wrestle your share from competition. This will be cutthroat. There could be blood bath.

In the cutthroat competition, you lose pricing power and there will always be pressure on the profit margins. Making profits, even after being able to sell you good, would be very tough. In fact, selling your goods itself would be extremely tough in such a situation.

If the answer to the question is positive, you may have pricing power.

At the same time, you now need to consider the next question if there is a gap in the market that you have identified.

Is there enough market in the gap?

If the answer in this case is negative, you do not have a large enough market to service. You cannot grow in size.

You may decide to find a niche and be happy with a small market. Sometimes that also could be a good decision.

If you set up a business, you may want to scale up. However, in certain activities – professions like accountancy, medicine, or architecture – which are skill and knowledge based, one may want to set up a niche practice.

Consider these two questions to understand whether you have pricing power and whether you can grow into a large business. The “gap in the market” is critical for margins; “the market in the gap” is critical for growth.

Set up a large business and make it profitable.

-        Amit Trivedi

The author runs Karmayog Knowledge Academy. The views expressed are his personal views. He can be reached at amit@karmayog-knowledge.com.

This article first appeared on the website of FT Foundation

Why investment goal is important to build a good portfolio

Investor often make mistake of investing blankly without setting appropriate goal. This later leads to investors been dissatisfied with returns on his investment. Financial expert Amit Trivedi tells us why setting investment goals becomes important to build a good portfolio. 

Read on ... http://www.moneycontrol.com/news/mf-experts/why-investment-goal-is-important-to-build-good-portfolio_871561.html

So Gold prices have crashed

So Gold prices have crashed. What would you tell your investors now?

This is probably the question that must be bothering most investment advisors. If you are an investment advisor, there is not a week that passed in last five years when some investor (your client or your prospect) came to you asking to invest in Gold. The yellow metal has always fascinated the world in general and Indians in particular.

Read on ...


http://www.nextadvisors.in/articles/so-gold-prices-have-crashed.html

Understanding calculated risk and its impact on investments

 Very often, one comes across certain clichéd terms, one wonders whether the user understood the meaning of what was said. The other day, I was having a discussion with someone who was concerned about the loss in an equity mutual fund account. He had been investing in this account through SIP for almost three years now. The moment I indicated that equity investments are always subject to a higher risk that this gentleman uttered a very commonly used phrase that he understood the risk and he always took “calculated risk”.

Read on ...

http://www.moneycontrol.com/news/mf-experts/understanding-calculated-riskits-impactinvestments_846028.html

Is the Union Budget unnecessarily hyped - article on www.moneycontrol.com

People tend to spend more time and efforts in analyzing Union Budget. While there are some points that would impact common man but other than that Budget mostly should be a non event. According to financial advisor Amit Trivedi, it is important to spend more time on one’s household budget than the Union Budget.

Read on ...

http://www.moneycontrol.com/news/mf-experts/isunion-budget-unnecessarily-hyped_838271.html

What is Important, Runs Scored or Runs Conceded?

The other day, I was having an interesting discussion with my son, who is crazy about cricket. He told me that when he grows up, he would score lots of runs and win the matches.

This discussion happened just around the time when Australia and South Africa were playing test match and Australia got out for one of their lowest scores to lose the match. I remembered the record breaking ODI between these two countries few years back. Australia had piled up a massive score of 434 runs in 50 overs and one felt they would win the match with a huge margin. South Africa had different thoughts. Australia still lost the match. 434 runs in 50 overs was a world record, but it remained a record only for the next 3 hours.

And how can we forget the classic 1983 cricket world cup final that India won defending only 183 runs?

It is not about the runs scored alone, it is also about runs conceded.

As experts would remind us, cricket matches are never won by conceding lots of runs. In the end, the team wins has to score and save more runs than the other.

In business too, not just the revenue, the costs are also equally important. A business makes profits only if it is able to keep the costs lower than the revenue. As Management Guru Peter Drucker would put it; “profits are never in the management’s control, it’s only the costs.” Or as Benjamin Franklin would put it, “A small leak sinks the boat.” So often, the focus is entirely on revenue. The costs sometimes get out of hand. It is ok in good times, but costs are the business’ enemy in lean times. Many costs are not visible immediately and sometimes immeasurable, especially things like wastage of material and time.

A businessperson also must understand that some costs are inevitable to run the business, whereas some are avoidable. It is the discretion of the top management that helps a business incur the relevant costs and avoid the unnecessary ones. In good times, the costs get out of control and in lean times, one has seen the pendulum swing to the other extreme. Costs are cut without due thought. It is the number of items where costs are cut rather than the actual cost cutting – that becomes important.

There is also a difference between costs and investments. The investments would not yield immediate results, but should result in long-term benefits for the business. Very often, the management tends to cut down on the long-term investments in the name of cost cutting. This results into immediate cost saving, but over time, it hurts business growth.

Be careful. Cost cutting is essential, not as a reaction to lean times, but as a culture.

Wish you all Merry Christmas.

-        Amit Trivedi

The author runs Karmayog Knowledge Academy. The views expressed are his personal views. He can be reached at amit@karmayog-knowledge.com.

This was published on the website of FT Foundation 

Santa Claus Rally - Pessimists are on a vacation - article on www.moneycontrol.com

When a 'Santa Claus Rally' occurs financial experts tries to analyse the reason behind it. It is important to analyse what happened and why, but it is equally important to ensure the analysis passes the test of soundness. Financial expert Amit Trividi advices investors to remain careful about such short cut analysis and do a proper study.

http://www.moneycontrol.com/news/mf-experts/santa-claus-rally-pessimistsonvacation_801557.html