bonds - Finance with Karthik

Top 5 psychological drawbacks that we face while investing through multi-asset investment strategy

Investing through a multi-asset strategy offers benefits like diversification, but it also brings psychological drawbacks that can affect decision-making. Recognizing and addressing these psychological drawbacks is key to making informed and effective investment decisions. In this blogpost, we’ll explore how these biases impact multi-asset investing and provide strategies to overcome them for better portfolio management. …

Investments Real Estate

How do investors lose money in real estate?

The idea that “real estate investment never leads to losses” is a popular belief among investors. There is a widespread belief that if you hang onto a property long enough, you will always make money. Let us try to figure out if it is true. How do investors calculate loss and gain? Investors calculate losses …

Shorts

How investors can enhance their returns from ‘Fixed Income’ instruments?

An individual’s portfolio creation is determined by their investing goals and risk tolerance. The information provided here is for cautious investors seeking for a little better yield than traditional fixed income products such as fixed deposits and recurring deposits. But please note that this is not any investment advice from me. The most fundamental and reliable …

Investments Real Estate Stocks

Should you invest in alternative assets?

First, let’s define alternative assets. An alternative investment is a financial asset that does not fit into any of the traditional investment divisions. Traditional asset types include equities, bonds, and cash. Simply said, these are not classified as standard financial assets like cash, fixed deposits, stocks, bonds, equity, or debt mutual funds. Alternative assets comprise assets …

Shorts

Gold is a good hedge against equity, but is it a good hedge against Bond as well?

If you’re thinking about investing in gold, there are certain points you should know. Gold is unquestionably a hedge—not only against inflation, but against the volatility of other asset classes such as equity and, at times, bonds. Historically, gold has been chosen during financial meltdowns when stocks fall and government and corporate bonds lose value. So, …

Crypto Investments

Non-Fungible Tokens – A risky bet?

What is a Non-Fungible Token (NFT)? If you’re unfamiliar with the word ‘non-fungible token’, then it’s necessary to firstly try to understand what ‘fungible’ means, what a ‘token’ is, and what features distinguish a token as ‘fungible’ or ‘non-fungible’. First let us see what a ‘token’ is: A ‘token’ can be anything that is used to symbolize value, …

Investments Mutual Funds

What should Mutual Fund investors do when markets are at all-time highs?

The rather simple answer to this question is “Do absolutely nothing”. The same is true whether stock prices are falling or the market is erratically moving. Of all, you’re a mutual fund investor, not a stock trader. You pay a partial sum of money to the fund company as costs, notably for managing your money. If you …

Shorts

What is ‘side pocket’ in mutual funds?

Bond funds can transfer corporate bonds to a separate account if the bonds they own fail to pay interest on schedule or are downgraded in credit. This separate account is known as the ‘side pocket’. We must exercise caution when an AMC sends a communication to the unit holders of one of its funds stating …

Shorts

Which one is better – Government Bonds or Bank Fixed Deposits?

We understand that bank fixed deposits (FDs) are vital for goal-driven investments since they assist in controlling reinvestment risk. Reinvestment risk is the chance that an investor won’t be able to invest back the cash flows from an investment—like interest or coupon payments—at a pace that matches their current rate of return on the investment. Investors …

Investments Mutual Funds

Portfolio diversification with US bonds exposure

Geopolitical upheavals, such as the current Israel-Gaza conflict or the Russian-Ukraine war, have focused attention on asset diversity, which aids in risk management of your investment portfolios. Historically, Indian investors have frequently limited their portfolios to domestic assets, restricting their diversification options. Accepting global markets can provide a great channel for increased diversification. Investing in international …