Thursday, August 30, 2007

The birth of the Mutual Fund with no distributors

Quantum Mutual Fund uses the internet and word of mouth to bring more business.
The story behind Quantum Mutual goes back to late 2005, when
after getting permission from Sebi to start his own AMC, Ajit Dayal met several distributors to create awareness about his funds. But he was shocked to see them put forth ‘a pricing sheet’. For 6% commission, you’ll get Rs 6,000 crore, for 5%, Rs 500 crore and so on, distributors told him.
“Without bothering to check whether a product is suitable for
investors, they came up with a sliding fee structure,” reminisces Mr Dayal, who is one of the first stock analysts and investment managers of the post 1991 era. “But who is going to pay for all this?” he asked them. The last straw came when Mr Dayal went to a senior broker and asked him to recommend his funds to investors, but refused to pay him the hefty commission that he demanded. “We make elephants in the industry dance to our tune, you are just an ant,” thundered the broker. The decision was made.
Read the full story on the ethical Mutual Fund in Economic Times
India's first online weekly on personal finance

Wednesday, August 29, 2007

Hefty Losses of the past in Indian stock markets

So what comes down, goes up again and vice versa!
Date Close Prv Cls Chg % Chg
18-May-06 11391.43 12217.81 -826.38 -6.76

16-Aug-07 14358.21 15000.91 -642.70 -4.28
02-Apr-06 12455.37 13072.10 -616.73 -4.72
01-Aug-07 14935.77 15550.99 -615.22 -3.96
27-Jul-07 15776.31 15234.57 -541.74 -3.43
28-Feb-07 12938.09 13478.83 -540.74 -4.01
05-Mar-07 12415.04 12886.13 -471.09 -3.66

Source: Business Standard

India's first online weekly on personal finance

Friday, August 24, 2007

Take responsibility for your MF decisions and pay the commission to yourself

SEBI has mooted a proposal on waiver of load for direct applications in Mutual Fund schemes.

Interested people may send in their comments on this issue to . Obviously distributors and agents will be up in arms against this proposal.

But I feel that such rules should be there for people who can/are ready to take responsibility for their investment decisions. Even for insurance! Is IRDA listening?
India's first online weekly on personal finance

Wednesday, August 22, 2007

Buying opportunities within the turmoil

Among the nervousness of the markets, Dhirendra Kumar of ValueResearchOnline makes a valid point when he says,
"I don't think there's anything much wrong with this as long as the real economy is fine. Companies are making more products and selling them. People are earning more money and spending it. The growth is real and deep. If the stock markets hang around for a while without going anywhere much, then that's that much more of a buying opportunity for those who have faith and are interested in the long-term.

This means that even though the impact of the so-called subprime mess could turn out to be important for a certain period of time, its eventual impact is less important than many other things that you'll read in newspapers."
India's first online weekly on personal finance

Monday, August 20, 2007

How a newbie can design a website?

Ten months ago I did not know what a blog was! Stuck at home due to a back injury, I was chatting with a geeky friend about websites when he suggested that why didn't I start with a blog. Blog? What's that, I said and my friend sent me the blogger link!!

And I have been amazed at the helping hand provided in forums, blogs, bloggers and comments who encouraged me on this journey. It's another kind of life!!

I wanted to organize all the information I had and wanted to share. Mainly because I felt that we have a long way to go before we reach some satisfactory levels of financial awareness. The blog had it's limitations and armed with the knowledge that geeky guys are always ready to help the newbies like me, I started asking more and more questions on forums and fellow bloggers.

And I reached Dreamhost! I shot off a mail to their support staff about my ideas of a website and how I did not know anything. Got a quick response about how to go about it and it mentioned something about Joomla, a CMS. That was in April, 2007 and I went to Joomla's site for the first time!

Dreamhost provides One-Click Software Installs including WordPress, phpBB, Advanced Poll, ZenCart, MediaWiki, Joomla, Gallery, WebCalendar. [ This means that with just ONE-CLICK - even a newbie can install a WordPress blog on ther server/website - they can also do that if they need a CMS or if they need an E-Commerce website - just one click to lift-off!!

I have installed Joomla on India's first online weekly on personal finance and wordpress on the site's blog. And did I mention free domain and subdomains!

In case any one ofyou have some website ideas, why don't you check them out. They have some great discounts and you might get some by mentioning this promo code too:SRV7

India's first online weekly on personal finance

What is the anatomy of distress selling?

© Bank for International Settlements ("BIS") has a working paper(No.229) on Distress selling and asset market feedback by Ilhyock Shim and Goetz von Peter.

This paper examines the process of distress selling and asset market feedback. It splits this process into several stages, in order to analyse what triggers distress selling, why asset prices fall, and how falling prices generate additional rounds of selling. This framework enables us to understand and compare models relevant to distress selling from diverse literatures.

The paper also considers what policy options are available at each stage to mitigate the adverse economic consequences of distress selling and asset market feedback

India's first online weekly on personal finance

Friday, August 17, 2007

When are you celebrating your Money Day?

>This was posted on India's first online weekly on personal finance on 14th August, 2007

JD Roth started writing his thoughts on personal finance which summarized all that he had learned from several months of reading financial self-help books. Now that journal has grown into a very useful and popular blog on personal finance, titled Get Rich Slowly, personal finance that makes cents! (Dollars, I would say)

In the following article, JDR shares his idea of a Money Day where you can focus on all personal finance matters in a day. Even though there are some issues which are US specific, the idea of a Money Day is universal.

Read on...

I opened my first checking account on the day I entered college. During registration, local banks set up tables at one end of the room. They all seemed the same to me. I chose the bank that gave me a free Frisbee. I did business with that bank for seventeen miserable years. I loathed that bank. They were constantly finding new and interesting ways to charge me money. If I hated it so much, why didn’t I change? Because I never felt like I had the time. Besides, I had no idea where else to go.

Eventually the bank went too far. Because of some obscure procedural policy, I was charged three $30 overdraft fees in a single day. This kicked my ass into gear. I took an afternoon off from work, closed my account, and started fresh at a local credit union.

It was one of the best financial decisions I’ve ever made.If I could solve one financial problem in a few hours, just imagine what I could do with an entire day. If you, too, have grand financial plans that you never seem to have time to fulfill, consider taking a personal Money Day.

Choose a normal weekday (when banks and business are open), take time off work, and get things done. Don’t worry that you’re using a vacation day for “nothing” — this vacation day will repay you many times over, not just now but for years to come.Before you begin, remove any barriers — mental and physical — that might prevent you from accomplishing your goals.

Gather all the account information you can find. Eliminate distractions. Commit to spending the entire day taking control of your personal finances. It’s time to do all the things you’ve been putting off!

Here are some tasks you might consider for your Money Day. These may sound dull, but the money you’ll save by taking the time to do these can be very exciting:

Read the full article
India's first online weekly on personal finance

Wednesday, August 15, 2007

Happy 60th Independence Day; Am I Financially Free?

India celebrates it's 60th Independence Day today. It's that time of the year when we take stock of our progress as a nation. Eminent writers will attempt to articulate whether we have made progress and what is the road map ahead.

To my mind, we have made a lot of progress and considering the set of conditions we operate in (democracy, Indian philosophy and work culture), I am not unhappy with what we have done till now. And I'm sanguine about the road ahead.

It is also a time when we should take a look at the financial sector reforms and progress we have made.

Also at an individual level, our personal finance decisions can result in financial freedom or a bondage with debt. The most conspicuous example is credit cards. They promise freedom from carrying money and encourage spending. But they don't tell you whether it is within your means to do the spending. The interests can trap you in a vicious circle.

So while we enjoy the freedom we have as a nation, are you as an individual, financially free? To me financial freedom means the right to do what I want to do. I still have some ground to cover when I achieve that situation.

India's first online weekly on personal finance

Does being more intelligent means more money for you?

The answer is No. Read this story which says,

Being more intelligent does not confer any advantage along two of the three key dimensions of financial success (income, net worth and financial distress).

Got the link from BusinessPundit Blog

India's first online weekly on personal finance

Sunday, August 12, 2007

How to find the best financial products in India

I have been looking around for a price comparison portal for personal finance products and I found Ecompare

The site looks very promising and Clayton Scott, Director, Ecompare, was very prompt with the answers I was looking for. Yes, its about time the Indian consumer had a quality service that can help them find the right product

1. What is ECompare?

Ecompare is a price comparison service that helps users easily find the best finance products available in the market. We aim to deliver simple to use service to assist our users quickly find the most relevant products.

2. Where did the idea come from? What is the research you have done on the business model?

Ecompare is based upon the success of the price comparison concept in other countries where it has grown over the last few years. We believe that its about time the Indian consumer had a quality service that can help them find the right product. We truly believe there is great potential for our product based upon our own research.

3. Are you planning to add Insurance products and Mutual Fund products?

We will certainly be adding insurance products to our service. However our priority at this stage is to launch mobile tariff comparisons first.

4. Tell us about your team.

We are a small team of 5 based in Hyderabad. We will be expanding over the coming months as we develop a sales team.

5. How has been the response? Can you give some idea about the traffic?

We have recieved a lot of very positive feedback on the concept. One user stated-

"This service is very helpful, it saves a lot of a consumer’s time and
effort. Its one of those services that one can really use and not one
of those that looks good sounds good but does nothing. "

We only launched 4 days ago with no large marketing push. Despite this traffic statistics are very encouraging for us at this very early stage. We are here for the long haul and our business model requires steady traffic growth so that is the key for us at this stage.

6. What are your goals with ECompare? I mean the number of page views daily and the revenue targets.

The goal for ecompare is to develop into the premier price comparison site in India. We truly want to deliver a service that helps our users save time and money and becomes a powerful tool for them in their search for the best financial products.

We believe that if we keep developing a quality information resource with expanding services our traffic and revenue targets will be achieved.

7. How do you market ECI?

SEO will be a major focus for us at this early point. As we expand the concept we will look to use wider marketing campaigns both online and offline.

All the best, Mr. Scott.
India's first online weekly on personal finance

Saturday, August 11, 2007

Win Prizes by answering this!

Tell me
a) who's sleeping,
b) who's woke up,
c) who is happy,
d) who's sick &
e) who's drunk

This was a mail forward from Violin Fernandez.
India's first online weekly on personal finance

Wednesday, August 8, 2007

Weekly Update No.I

The following are the important events and decisions made during the first week of August’07 which has an impact on our personal finances.

* On 31st July, RBI Governor announced the review of its monetary policy and increased the cash reserve ratio (the deposits that banks keep with RBI) from 6.5% to 7%. RBI also lifted the daily cap of Rs 3000 crore which the RBI had kept on absorption of excess liquidity. The CRR move will lead to absorbing around Rs 15-16000 crore of excess liquidity from the system.

* The RBI has the unenviable task of reducing inflation, keeping the interest rates benign and also keeping the Rupee appreciating beyond Rs 40 a dollar. The three are linked but not exactly friendly with each other. To keep the Rupee from appreciating, RBI is buying Dollars. And that injects extra liquidity in the system which can lead to inflation.

* Facing the wrath of the sub-prime woes in the US markets, the Indian indices plunged sharply on August 1 and this resulted in them ending lower for yet another time on the bourses. The week was witness to one of the biggest intraday declines ever. Coming on the back of a huge sell off across the globe, especially in the US markets, Sensex edged lower by more than 600 points on Wednesday and Nifty too, declined by more than 180 points.

* The markets are nervous and the volatility index, maintained by the Chicago Board Options Exchange, has doubled in recent weeks. Swaminathan S Anklesaria Aiyer, in his weekly column in TOI asks us to hope for the best but be prepared for the worst. Mr Aiyer has visualized three scenarios. One, nothing to worry, things will become normal soon. Two, there is a cyclical down trend waiting to happen. Three, there’s a disaster coming! He remembers the Asian crisis ten years back.

* In Mutual Funds, the total Asset under Management (AUM) reached Rs 4,86,513 crore at the end of July, a jump of 21.5% over Rs 4,00,333 crore at the end of June. That too when the PAN has become compulsory from July 1, 2007 and the MFs were cribbing about it being unfair that the Insurance companies were not subjected to the same regulation.

* UTI Mutual Fund latest offer of Lifestyle Fund takes into accounts the changing demographics. This scheme has an investment objective to provide long term capital appreciation and/or income distribution from a diversified portfolio of equity and equity related instruments of companies that are expected to benefit from changing Indian demographics, Indian lifestyles and rising consumption pattern. There are 242 companies identified for investment and I’m told that the last three year return of these companies is 52% and for the last one year, it’s a whopping 72%!

* ICICI Prudential Life Insurance Company will be focussing on health insurance in a major way. The company has announced the launch of “Crisis Cover”, a policy covering 35 critical illnesses, total and permanent disability and also death. Crisis Cover will be sold through the company’s 680 branches. ICICI Prudential is working on revamping its features of Diabetes Care, a plan launched in November last year. The policy encourages a monitoring regime as per the Diabetic Association of India with policyholders required to undergo three mandatory tests

India's first online weekly on personal finance

Tuesday, August 7, 2007

First Update for India's Online Weekly on personal finance

India’s first online weekly on personal finance had it’s first update today.

To begin with we had this week’s roundup. The roundup featured the monetary policy review by RBI Governor on July 31, the sentiments of the stock market, a review of the fund launched by UTI MF, a health insurance product from the ICICI Pru Life Insurance Company, etc.

Ajay Shah was kind enough to allow me to publish a very useful article on Derivatives on Nifty Junior and CNX-100. And we had three articles on Insurance, Stocks and Financial literacy.

And we also linked to an article by IndiaKnowledge @ Wharton titled Currency Conundrum: Is the strong rupee good or bad for India?

Go Take a look. And tell me how it is, please.

India's first online weekly on personal finance

Monday, August 6, 2007

Social News Reading Site:

NEooWS is a Social NEWS reading site, where people can read news, make friends and share with them what's happening around the world. NEooWS looks to me a blend of a RSS Reader (I use Google Reader), Digg and!! Interesting I think this is unique. They have all the major features like, Tagging, Commenting, Recommending, Emailing, Saving, etc. which other similar sites have. They plan to announce some unique features soon. The key point is NEooWS gets better as you use it every day, so why don't you check it out.

I wrote to Rahul Sapkal, the founder CEO and he has given greater details of his venture. Read on...

What is NEooWS?
NEooWS is an online RSS aggregator and reader with all the features of a conventional desktop reader and more. The idea behind NEooWS is to build communities around news. Users can add comments and vote for popularity of stories from various sources, tag stories, and create groups. It also allows to compare news stories from different sources.

Why'd you name it that?
Its NEWS with a pair of eyes in the middle. NEooWS .

Where did the idea come from? What is the research you have done on the business model?
The idea actually evolved from our experiments with RSS. We found RSS as a very powerful concept to build a feature-rich consolidation website. Before we knew it, we were consolidating news and stories from various popular sites in one place, making a very powerful platform to read news and share insights. NEooWS evolved organically
from an experiment to a social networking website around news.

How did you actually build NEooWS(how much did it cost, where do you host, what CMS, coding, finding people, etc)?
NEooWS was built by two friends over six months of effort. The user interface went through different looks before we arrived at the current look. Rahul Sapkal is the primary architect with backend and logistics support from a friend in California.

We have a long term relationship with our hosting provider Lunarpages ( We host NEooWS from Lunarpages's San Diego datacenter.

We are very much in public beta right now, and we are seeing some aggressive growth in the number of people visiting the website daily. We have quite a few repeat visitors with over 1000 registered members. Typically, guests visiting the website have grown manifold since we launched, and the average time being spent on the site by users has been steadily increasing. We are monitoring these statistics on a daily basis and are working on translating the large number of guest users into daily visitors.

What are your goals with NEooWS ? I mean the number of page views daily and the revenue targets.
Our goal with NEooWS is to make it the single best choice to read news on the Internet. We have a solid plan which we plan to implement over the next 6-8 months, which will allow users to read news online,offline and while they are mobile. Our customization features are on target to be the best offered by any news site, and are aimed at providing unparalleled flexibility to users of NEooWS on how they wish to consume the content.

We wish to start monetizing NEooWS with targeted advertisements and value added features (coming soon) when we have our NEooWS story near completion (see above). The target is to gain momentum in converting users and kick-start revenues by the end of year 2007.

How do you market NEooWS?
Currently, we rely on reviews and interviews related to NEooWS to market the site. Our main marketing tool is word of mouth. This works well during a beta stage since we are getting our feet wet with a large number of users, and interviews such as this help in driving more users to the site. We are mostly testing most of the features to make sure they are absolutely solid for use by our valued audience at this time, and the limited marketing keeps traffic to a manageable level for us to work with and improve.

Once we reach our target feature set, we will be more direct in marketing NEooWS with inviting blog reviewers directly, targeted advertising using google, yahoo etc. to drive users to the site.

Is there a USP for NEooWS that you are working on?
Absolutely. I won’t elaborate, but suffice it to say that we are working on features that will target every consumer of news stories (online or offline) with value added features that will target everybody.

What would you say to a person who wants to do something entrepreneurial?
We say, keep at it. If you find an idea interesting because it solves a problem you are facing, chances are, there is an audience for you. How big the idea is depends on how many such target users you will eventually have. Niche ideas generally do much better in garnering an audience if the right marketing is put in the mix.

If you are engineers like us, get professional help to market your site.

Q. What importance do you give to finding the funds vis a vis the idea?
It actually depends on the idea. Some ideas can be implemented on a shoestring (such as NEooWS). Others need funding. In case of the latter, we believe it is mandatory to go through the step of finding funding since that puts you through a trial of fire. If you capture funding from VCs, your idea probably has merit and it is a matter of
good execution to succeed.

In case of NEooWS, it is privately funded (mainly time and hosting
costs), which enables us to control the agenda and features we would
like to provide. However we would like to hear from people interested in NEooWS or have a proposal to work with us, write to us at

India's first online weekly on personal finance

Saturday, August 4, 2007

Foreword for India's first online weekly on personal finance

You readers have helped me and my small & young blog (not even one year old) to dream of constructing India's first online weekly on personal finance. When you check it out, you'll see a forum, an advisor's directory, a blog and sections on Mutual Funds, Stocks, ETF, Insurance, etc.

And a section for Foreword too. I want you to contribute to that. I'll be the happiest person to post your thoughts in that section.

I want you to give your personal finances a thought and check whether you are on the right track. Or are there things you would try to improve? What is the importance of money to you? Is it evil or a necessity? What is your expectation from the site?

These thoughts can form part of your foreword.

India's first online weekly on personal finance

Friday, August 3, 2007

India's first online weekly on personal finance

I'm excited about this website which is India's first online weekly on personal finance. The design and contents of the site has been on my mind since a year and I'm proud that despite knowing nothing of coding, I have been able to come up with this site with a cost next to nothing.

Along the way I have been helped by many helpful coders, developers and encouraging words and I can't thank them enough.

Take a test drive, please and let me know what you feel.

India's first online weekly on personal finance