Gift fi­nan­cial knowl­edge on Fa­thers’ Day

DNA (Daily News & Analysis) Mumbai Edition - - FRONT PAGE - Hitesh Cho­talia

Our fa­thers with pro­gress­ing age have at­tained ma­tu­rity and acu­ity in de­ci­sion mak­ing and they are ca­pa­ble of tak­ing tough de­ci­sions, main­tain­ing a ra­tio­nal bal­ance. But our fa­thers have also faced ex­haus­tion and stress due to long work­ing hours and ex­pe­ri­enced agere­lated health prob­lems, in the ef­fort of pro­vid­ing a bet­ter life­style to us. As the cost of liv­ing is in­creas­ing at ex­po­nen­tial rates, it is also very im­por­tant to main­tain in­come av­enues post-re­tire­ment and utilise their free time and saved cap­i­tal in a more con­struc­tive man­ner.

Many face dif­fi­culty in keep­ing them­selves oc­cu­pied and also earn­ing in­come si­mul­ta­ne­ously in a more re­laxed and com­fort­able rou­tine. Stock trad­ing pro­vides an op­por­tu­nity to the re­tired fa­thers to start their own ven­ture from the com­fort of their home. Ma­jor­ity of them avoid risk, while mak­ing in­vest­ment de­ci­sions with tra­di­tional in­vest­ment tools which are not in sync with cur­rent de­mands. It may be nec­es­sary for them to add eq­uity to their port­fo­lio.

There is now an op­por­tu­nity for one to gift trad­ing knowl­edge to their fa­thers, who have spent their en­tire life toil­ing and work­ing hard to ful­fil the needs of their fam­i­lies. It will help him re­tain or in­crease his fi­nan­cial ca­pa­bil­ity even post-re­tire­ment. One can start by en­quir­ing and en­rolling his/ her fa­ther to one of the rep­utable trad­ing in­sti­tutes that of­fers hands-on ex­pe­ri­ence of live mar­kets and the skills to trade in­di­vid­u­ally and with less stress.

Many in­sti­tutes of­fer free work­shops, psy­chol­ogy trad­ing work­shops and sim­u­la­tor-based trad­ing for be­gin­ners to learn the ba­sic concepts with no risk.

Trad­ing is a skill-based busi­ness ac­tiv­ity, which re­quires time and pa­tience to learn the nui­sances of the stock mar­ket and it has also proved to of­fer bet­ter re­turns than tra­di­tional sav­ing in­stru­ments such as fixed de­posits, NSE cer­tifi­cates etc.

Trad­ing pro­vides dif­fer­ent av­enues de­pend­ing upon the in­di­vid­ual’s risk ap­petite, time availabili­ty and knowl­edge, for ex­am­ple, day trad­ing, swing trad­ing or po­si­tional trad­ing. It pro­vides the op­tion to be self-di­rected and man­age one’s own cap­i­tal. Let us un­der­stand these concepts in brief:

Day trad­ing

As the name sug­gests, day trad­ing in­volves the ac­tiv­ity of buying and sell­ing stocks in a sin­gle day, or even mul­ti­ple times through­out the day. This type of trad­ing re­quires high alert­ness and a well thought out strat­egy be­fore go­ing ahead. One should be up­dated with cur­rent mar­ket news and events that can affect the stock mar­ket on a real-time ba­sis.

Swing trad­ing

Swing trad­ing in­volves hold­ing a trad­ing po­si­tion for a week’s time and try­ing to cap­ture 3-5% price move­ment in stocks. If the profit tar­gets are achieved in a day or two, the per­son can take profit home. It is ad­vis­able to do swing trad­ing in Nifty 50 stocks which give good in­tra week move­ments. Here, trad­ing is con­ducted on short term trends and also the in­tra week volatil­ity.

Po­si­tional trad­ing

In this, the hold­ing pe­riod is longer. It can be any­where from one to three months. Its al­ways ad­vis­able to do po­si­tional trad­ing in fundamenta­lly sound stocks.

The writer is head of ed­u­ca­tion at Fin­learn Academy

Goal­wise starts di­rect MFS

Shift­ing the busi­ness strat­egy into higher gear, Goal­wise, a goal­based mu­tual fund in­vest­ing plat­form, has an­nounced its foray into di­rect mu­tual fund plans. With this ini­tia­tive, the start-up be­comes the only in­vest­ment ad­vi­sory plat­form in the coun­try to of­fer goal-base in­vest­ing in di­rect mu­tual funds free of cost. Ear­lier, the plat­form’s of­fer­ings were only lim­ited to reg­u­lar plans. Now, it has made in­vest­ing com­pletely com­mis­sion-free while re­tain­ing the orig­i­nal prod­uct of­fer­ings. The ab­sence of com­mis­sion means that in­vestors get to reap more ben­e­fits from di­rect mu­tual fund than its reg­u­lar coun­ter­part. For one, di­rect mu­tual funds have a lower ex­pense ra­tio. Se­condly, they fetch higher re­turns due to the com­pound­ing of money that would oth­er­wise be paid as com­mis­sion in reg­u­lar plans.

Re­liance Fixed Hori­zon Fund

It is a close-ended scheme. The pri­mary in­vest­ment ob­jec­tive of the scheme is to seek to gen­er­ate re­turns and growth of cap­i­tal by in­vest­ing in a di­ver­si­fied port­fo­lio of the fol­low­ing se­cu­ri­ties ma­tur­ing on or be­fore the date of ma­tu­rity of the scheme with the ob­jec­tive of lim­it­ing in­ter­est rate volatil­ity, Cen­tral and State Gov­ern­ment se­cu­ri­ties and other fixed in­come/ debt se­cu­ri­ties. How­ever, there can be no as­sur­ance that the in­vest­ment ob­jec­tive of the scheme will be achieved. Min­i­mum subscripti­on amount is Rs 5,000 and in mul­ti­ple of Re 1 there­after, and of­fer closes on June 12.


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