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View Poll Results: Where do you invest your surplus money?
Conventional (NSC/PPF/LIC/Fixed Deposit etc.) 82 48.52%
Share/Stock Market 64 37.87%
Mutual Funds 83 49.11%
Business (own/family/friends) 12 7.10%
Real Estate (land/flat/house) 69 40.83%
Others 8 4.73%
Multiple Choice Poll. Voters: 169. You may not vote on this poll

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Old 13th December 2018, 22:28   #76
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Default Re: Where do you invest your money?

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One question. How does a platform like this survive on no comission? It takes a lot of effort to create and maintain a trading portal. I am just trying to understand what is the catch. Are they being funded by the AMC? Or are they selling your information to make money? Because at the end of the day, nothing comes for free.
As the name suggests, their charges are 'zero' for pretty much everything. The idea is to get mutual fund customers who will eventually get into shares investing via Zerodha, which is free too. But a small percentage of such investors will eventually start trading, especially in derivatives. That's where zerodha makes money - from trading customers.

Zerodha is now the third largest broker in India in terms of number of clients
https://zerodha.com/z-connect/zerodh...roker-in-india

In FY15, they had revenues of Rs. 115 crores and profits of Rs. 65 crores - this was three years ago
https://economictimes.indiatimes.com...w/52711067.cms

More on Zerodha:
https://en.wikipedia.org/wiki/Zerodha

Last edited by SmartCat : 13th December 2018 at 22:29.
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Old 13th December 2018, 23:18   #77
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Default Re: Where do you invest your money?

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As the name suggests, their charges are 'zero' for pretty much everything.
In addition they are charging Rs. 20 for Buy and Rs. 20 for Sell in MIS. That's a huge revenue stream.
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Old 14th December 2018, 11:38   #78
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Default Re: Where do you invest your money?

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That loophole was plugged in 2014. Mutual fund houses deduct 29% of interest earned as Dividend Distribution Tax.
https://cafemutual.com/news/industry...p-from-april-1
I am aware of that part. The actual DDT is 28.84%. That's a good 1.16% saving on the tax you pay. Now calculate and you will realize that it is a tidy saving. On every 1 lakh rupee the guy at the highest bracket is saving 1160 rupees.

If you are on the verge of retirement or someone who has retired or even someone who likes to keep a good 5 lakhs (or more) in FD form to maintain liquidity you are saving a tax outgo of Rupees 5800 or more (depending on your liquid fund investment) in taxes. As I said, it may not be a fortune but it is "tax efficient" as compared to the growth option.
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Old 14th December 2018, 16:42   #79
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Default Where do you invest your money?

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I am aware of that part. The actual DDT is 28.84%. That's a good 1.16% saving on the tax you pay. Now calculate and you will realize that it is a tidy saving. On every 1 lakh rupee the guy at the highest bracket is saving 1160 rupees.



If you are on the verge of retirement or someone who has retired or even someone who likes to keep a good 5 lakhs (or more) in FD form to maintain liquidity you are saving a tax outgo of Rupees 5800 or more (depending on your liquid fund investment) in taxes. As I said, it may not be a fortune but it is "tax efficient" as compared to the growth option.

Is this calculation right? DDT will be on the dividend paid, not on entire corpus. Assuming you get 7% dividend in a year, you will get Rs 7000 for Rs 1 Lakh in the fund. Savings of 1.16% of that is a paltry 81 rupees, not 1160.

In the long run, Growth plans are any day better than Dividend plans, provided there is no need of steady inflow of money. Even if there is a need of money, you will only pay tax on the gains of actual redemptions. Once you have kept the fund intact for 3 years or more, you will start benefitting from indexation.

Last edited by SilentEngine : 14th December 2018 at 16:43.
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Old 14th December 2018, 18:45   #80
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Default Re: Where do you invest your money?

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Is this calculation right? DDT will be on the dividend paid, not on entire corpus. Assuming you get 7% dividend in a year, you will get Rs 7000 for Rs 1 Lakh in the fund. Savings of 1.16% of that is a paltry 81 rupees, not 1160.
No, the calculation is not right. I agree. The DDT is only on the portion of the dividend and not corpus. So that part was an oversight on my part.

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In the long run, Growth plans are any day better than Dividend plans, provided there is no need of steady inflow of money. Even if there is a need of money, you will only pay tax on the gains of actual redemptions. Once you have kept the fund intact for 3 years or more, you will start benefitting from indexation.
The point here is that the Liquid funds are not something where most people like to keep money on a very long term basis. So if you are not the type who intends to park a big portion of your fund for 3+ years in the liquid fund category then the dividend option is more tax efficient than the growth option.
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Old 9th July 2019, 20:16   #81
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Hope this is the right thread to post my query:-

There's a new 'Gold Vault' in Google Pay where they say we can buy and sell 24k gold from MMTC-PAMP. Can someone shed light on this as to how it works, what returns could one expect and how is it different from other traditional methods?
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Old 9th July 2019, 20:34   #82
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There's a new 'Gold Vault' in Google Pay where they say we can buy and sell 24k gold from MMTC-PAMP. Can someone shed light on this as to how it works, what returns could one expect and how is it different from other traditional methods?
You buy physical gold via Google Pay but actual storage in vaults and its insurance is taken care of by MMTC. Your returns will be closely match that of Gold. If you want to "trade" in Gold for the short term, this seems like a good idea.

But long term Gold investors should invest in RBI's sovereign gold bonds instead of physical Gold since you get extra 2.5% returns (in the form of interest paid by Govt).
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Old 10th July 2019, 11:43   #83
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But long term Gold investors should invest in RBI's sovereign gold bonds instead of physical Gold since you get extra 2.5% returns (in the form of interest paid by Govt).
But isn't it a better option to invest a part of the money on physical gold? In the event of a catastrophe - say riots, genocide, invasion etc, you can pick up the stuff and run. Once you find a safe haven it would come to use. The investments with the banks and other govt backed institutions could simply vaporize.

ps: Am not advocating having the whole investment as gold, but some for emergency use.
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Old 10th July 2019, 11:56   #84
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Default Re: Where do you invest your money?

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But isn't it a better option to invest a part of the money on physical gold? In the event of a catastrophe - say riots, genocide, invasion etc, you can pick up the stuff and run. Once you find a safe haven it would come to use. The investments with the banks and other govt backed institutions could simply vaporize.

ps: Am not advocating having the whole investment as gold, but some for emergency use.
Do you forsee riots, genocide, invasion etc happening in India in the near future? Even if the riots happen, it does not need one to get their Gold and run.

Just my 2 cents
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Old 10th July 2019, 12:06   #85
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But isn't it a better option to invest a part of the money on physical gold? In the event of a catastrophe - say riots, genocide, invasion etc, you can pick up the stuff and run. Once you find a safe haven it would come to use. The investments with the banks and other govt backed institutions could simply vaporize. ps: Am not advocating having the whole investment as gold, but some for emergency use.
Yeah, physical Gold is portable wealth and decent store of value. Cryptocurrencies too were supposed to be like Gold, but it is too volatile to replace Gold as store of value.

Armageddon (invasion, genocide, civil war etc) wrecking the lives of citizens is more likely in small African or Middle Eastern countries, not a country like India. Remember that we have RBI's liberalized remittance scheme where you can transfer up to $250,000 per year to a foreign country of your choice.
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Old 10th July 2019, 12:24   #86
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Default Re: Where do you invest your money?

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Do you forsee riots, genocide, invasion etc happening in India in the near future? Even if the riots happen, it does not need one to get their Gold and run.

Just my 2 cents
Changes happen quite fast, and I do see some possibility in the horizon, now that we have taken a path towards being a theocratic state. Afghanistan, Iran, Syria etc are examples. Strife, internal and external, leads to erosion of value (and hence wealth), and I think gold can hold on to its value better than currency.

There has been several ups and downs in gold prices, but not as much to cause worry. It may stagnate or even go down in the future, but there would still be some residual value left unlike currency which could depreciate to stink in case there is a strife.
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Old 10th July 2019, 12:31   #87
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Yeah, physical Gold is portable wealth and decent store of value.
Physical gold may be portable otherwise, but in case of riot, genocide etc, it only serves as a mob magnet and ergo endangers one further.
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Old 10th July 2019, 13:29   #88
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Default Re: Where do you invest your money?

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Do you forsee riots, genocide, invasion etc happening in India in the near future? Even if the riots happen, it does not need one to get their Gold and run.
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Yeah, physical Armageddon (invasion, genocide, civil war etc) wrecking the lives of citizens is more likely in small African or Middle Eastern countries, not a country like India.
Financial institutions crumbling and wiping out investors money and savings, is a bigger risk. FRDI bill, linking savings and PF a/cs to markets, banks going belly up, "industrialists" looting public money and thumbing nose once they move out of country etc. - all these do not really inspire confidence in general public.
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Old 30th July 2019, 17:03   #89
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Financial institutions crumbling and wiping out investors money and savings, is a bigger risk. FRDI bill, linking savings and PF a/cs to markets, banks going belly up, "industrialists" looting public money and thumbing nose once they move out of country etc. - all these do not really inspire confidence in general public.
^ This. Anyone who is observing closely the current state of affairs of state, would know things have been set in motion, that points to upcoming destabilisation & sh*t storm.

Perhaps, real estate investment could be a relatively reliable investment option, apart from gold; buy a good insurance for flat/house that covers social unrest etc. Keep a portion of BTC tucked away somewhere, regardless.
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