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Worldwide, there is a lot of hue and cry over high expense ratio that investment management firms charge for generating better than market return. Globally, funds are moving out of active strategies to low cost passive investing. The logic for these flows is often cited that value addition done by active mutual funds is small and uncertain vs the fees charged by them.
Talking in the Indian Context, The Securities and Exchange Board of India (SEBI) wants to review whether Indian mutual funds are overcharging their customers by imposing a high total expense ratio (TER).
Stock investing is all about the future, you invest today with the expectation of a return tomorrow. And when it comes to anything about the future, we are prone to believe in predictions and predictors. Our belief may range from mild interest to staunch conviction; so much so that we may not do anything significant without consulting the stars and the astrologer/forecaster. So, how do we differentiate anything said in stock investing as an act of prediction (a forecaster approach) or sound analysis (an Analyst approach)?
Fishermen depend on luck, and the Vegetable Farmer depends on tending to the investment continuously to bear some result. Both have short-term perspectives and require continuous engagement. But here’s the catch – It has been proved that the probability of earning returns in the short-term is more like tossing a coin with 50-50 chance of getting the positive result. This is more like a computer picking up a stock for you.
Markets have once again started correcting. This time it appears that correction is happening at much faster rate. This could be because there are real concerns on marco-economics side.Rising Crude Oil prices have always been a pain point for India as we are net importers (oil and Gold). This leads to pressure on dollar reserves and hence currency weakness. This increases cost of capital in the country and leads to fall in asset prices, in stocks and bonds.
A lot of people ask how is MoneyWorks4me Portfolio Advisory different than other players. And the unstated question is how do I know if it is right for me? To be able to appreciate the differences and also know if it is right for you, you need to understand the services/models of the different players in the industry. Read this article to know,What are the different types of ‘Advisory’ services available to Investors?