BC GENERICLEARNINGS
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Personal Finance 101 – My learning’s about investing

This topic is for everyone, whether you manage your money yourself or through your advisor, it will go a long way in managing your finances.

Do re-tweet & help us educate retail investors (1/n)

 Subscribe to our YouTube for some interesting educational content around Personal Finance - https://t.co/jvgNEDWiAZ

And you can also join our Telegram channel for regular updates – https://t.co/Ekz6I8pDGt (2/n)
(1) Lets start with Life Insurance

Term Insurance is the best way to take an insurance cover & probably the only product to buy in life insurance. Make sure u disclose all the necessary information before taking the insurance. Smoking, Alcohol, any pre-existing deceases etc(3/n)
Have atleast 10-15 times of your annual income as insurance cover

But there are variants of term insurance that you should avoid (4/n)
(A) Term plan with return of premium

For a non-smoker born on the 1st Jan 1985 & policy term 39 years (till age 75), the regular premium for a 1-cr term insurance is 22,157 (inclusive of GST) but with returns of premium is 42670 (inclusive of GST). An increase of 20,513 (5/n)
Return of premium means, if nothing happens to you in the 39 years term, the premiums you paid (minus of taxes) will be paid back to you. If something happens, both the policies (regular term & return of premium) pay you the same, 1 cr. (6/n)
Lets do some basic calculation,

(i) Without GST premium = 42670/118% = 36161
(ii) Premium returned at policy end if nothing happens = 36161*39 = 14,10,280 (7/n)
(iii) vs that, if u invest the difference in premium 20,513 every yr for 39 years @ 6% post tax, future value will b 23,54,112 vs 14,10,280 paid by the policy
(iv) In other terms, the policy is only paying u 2.77% on the additional premium u r paying over the regular premium(8/n)
(B) Term insurance with limited pay is another trick.

They will advertise it saying instead of paying 22,157 for 39 years (total 8,64,123), pay 48,830 for 10 years (Total 4,88,300 and save 43% premium, but, the trick here is time value of money. (9/n)
Lets do some basic calculation,
(i) If u calculate the present value of both stream of cash flows @ same rate of 6%, Present Value of regular pay (39 years) is 3,51,100 & 4 limited pay (10 years) is 3,80,957. In today’s term, u r paying 29,857 more in limited premium plans(10/n)
(ii) One more big difference is recovery of premium. In first 10 years, in limited pay, insurance company has recovered 10 out of 10 premiums vs. 10 out of 39 premiums in regular pay. So, in case the claim gets triggered in 11th year, limited pay option is at disadvantage. (11/n)
(iii) In limited pay option, insurance companies offer options from single pay to 5 years to 10 years. The lesser the payment term, the bigger will be the set back. (12/n)
(C) Third variant is Term Insurance with life cover upto 99 years, which is also a similar story. Read our blog for the data points - https://t.co/sr86RDqq0N (13/n)
(D) Mixing insurance & investment, is the biggest mistake. Insurance should be used for risk management & not investment management (14/n)
(i) Buying traditional Life Insurance (Endowment, Money Back, whole life etc) does nt give u adequate insurance cover. Insurance is generally 10 times of the premium. So if u r contributing 3L a year as premium, you are covered for roughly 30Lakhs, which may not be enough (15/n)
Avoid most traditional plans as neither do they cover u 4 insurance & nor r the returns worth investing 4. Don’t get carried away by the maturity figure & tax-free status. If u ever calculate the actual return in % terms, you will know the return is half of your inflation (16/n)
(ii) ULIP in most cases is an avoid. There are a few ULIPs with Zero premium allocation charge, Zero Policy admin charge which can be consider, specially for the tax free status upto 2,50,000 annual premium, But a big draw back is you compulsorily need to buy insurance. (17/n)
- Imagine paying 2,50,000 as premium but the entire amount not getting invested. If you are 30 years of age without any term insurance, this is okay. Out of 2,50,000, some premium will be allocated to term insurance giving you 25L cover and the remaining will be invested (18/n)
- But if you are 50 years old, a high mortality charge (term insurance premium) will be deducted towards insurance and hence the net investment will be much lower. (19/n)
- Or you already have insurance; this might not make sense because you will pay towards your term insurance in the ULIP when you might not need it, reducing your returns

Which is why, in most cases you can ignore ULIP’s as well. (20/n)
(2) Lets discuss, Health Insurance now. A must to have!

- Make sure you mention all the necessary information while applying for the cover and not hide any material fact. Smoking, Alcohol, Pre-existing deceases etc. This is a major reason why most claims get rejected. (21/n)
- Don’t only rely on the employer 4 cover, u might need more
- In case of a claim, Mediclaim will nt settle 100% of the bill amount; there may be items, which the insurance is nt covering, & the same needs 2b paid by u. Have some medical fund in place 4 such contingencies (22/n)
(3) Contingency Planning

- Make sure you have atleast 6-12 months of your monthly expenses, including you EMIs, kept aside in an liquid fund for any unforeseen eventuality (23/n)
(4) Goals
- Always have a goal in mind and define it in money terms, only then you can plan for it. Ex. Buying a house worth 2cr. in March 2030.
- Having a goal also brings in discipline in your investing (24/n)
- While planning for the goal, keep in mind inflation. The value you may require for your goal may be much higher than the value of the same goal today.
- Keep you goals realistic (25/n)
(5) Start investing as early as possible
-If u want to accumulate 5 cr. at retirement at 60, below is the SIP u will have 2do depending on when u start, assuming 10% returns
-Starting 10 years later will require u to do 40,000 instead of 14,500 to reach the same goal (26/n)
(6) Investing thoughts
-Investing golden rule 30:30:30:10. Maximum 30% of ur income as EMI, 30% household expense, 30% Savings & 10% liquid
-Always maintain an Asset Allocation. Don’t invest most of what u have in 1 asset (27/n)
-Avoid investing in instruments you don’t understand and/or are complex.
-There is no get rich over night investing strategy. You will have to give it time
-Avoid looking at your portfolio value daily
-Save more (28/n)
(7) Equity Investing

- If you don’t understand stock picking, stick to MFs
- Equity is a long-term asset, invest for long term
- Avoid F&O if you don’t understand it
- Investing creates wealth not trading (29/n)
(8) Fixed Income Investing

-Debt mutual funds are better over FD’s if you can avoid looking at the daily NAV and give it the 3-5 years you normally give your FDs
-Higher the interest rate offered, higher is the risk
-Fixed income is risk free is a misconception (30/n)
-Detailed insight on Fixed Income investing - https://t.co/osjZqVDNEA (31/n)
(9) Real Estate

-Don’t consider the real estate u stay in as a portfolio investment, u will rarely b able 2 use it 2 convert 2 cash when u want it
-RE investments r extremely illiquid
-Rent you receive on housing RE investment is 2% vs 6-7% on commercial real estate (32/n)
-Therotically, renting is a better option over buying a residential RE
-Interesting way to invest in RE - https://t.co/7doPyKWe7D (33/n)
(10) Gold
-Don’t consider the Gold jewellery at home as investment if you are not going to sell it when the price increases. Its your emergency fund
-Investments in gold should be in bars and not jewellery. Why spend on making charges? (34/n)
-Best case, avoid physical gold and save yourself from GST, Fraud & Theft.
-Best way to invest in Gold is through Gold ETFs & SGB
-More about gold investing - https://t.co/HubxI58OMZ (35/n)
(11) Tax Planning –

- Always try and utilize your 80C limits to the fullest. If you are in the 30% tax bracket, you directly save 1,50,000 * 30% = 45,000 of tax.
- 80C is no reason to invest in Insurance & 5 years bank FDs.
PPF, ELSS are much better options (36/n)
- Do tax planning & nt tax avoidance
- Cash that u generate by avoiding tax gets spent & does nt help u grow ur wealth. Its better 2 pay tax & invest the rest. Calculations show that in 3 years of investing, u recover the tax u paid & the investment can then keep growing(37/n)
- You can surely consider NPS. Have written about it in the past - https://t.co/KAhkC1WAqR (38/n)
(12) Debt Management
- It’s a blessing to be debt free
- Home loan, working capital loan kind of loans are okay but strictly avoid personal & credit card loans
- Don’t take loans & invest

& finally, have a will! (39/n)
Read our detailed blog by @stepbystep888 on this topic for some very insightful learnings.

Link - https://t.co/sr86RDqq0N (40/n)
We have written multiple threads earlier on
- Sector Analysis
- Macro Economics
- Debt Markets
- Real Estate
- Equity Markets etc.

You can find them all in the link below. Do hit the re-tweet & help us reach a larger audience

https://t.co/UrRt87xaU7 (**END**)

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Is US going to default on its debt?

This 🧵 will surely help you understand. Do ‘re-tweet’ & help us educated investors (1/13)


How does a country run?

Assume a country to be like a company, which has income & expenses. Income source can be tax collections & expense can be government employee salaries, defence sending’s, social security schemes etc. (2/13)

Generally, most economies are running a deficit; their income is less than expense. So if your income is 100 and expense is 105, where do you get the 5? You borrow!

Similarly US has been borrowing & the total debt today roughly stands at a whooping $28.5T. (3/13)

Deficit in the last 2 years has gone up significantly because of COVID + the government wants to spend more; a $3.5T spending package is what they are trying to get an approval for + older debt is coming up for maturity (4/13)


Okay, so I am saying they will raise more debt for the deficit of COVID, the new package & paying older debt off?

Ideally a yes but they are not allowed to borrow more! (5/13)
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After writing on Banking & Paints, this thread focuses on the 'Logistic Sector'. Idea is to give a small start to the retail investors looking at investing in this space from where they can build on.

This thread covers,
- Macro
- Business Model
- 3PL & 4PL
- Valuation (1/n)

Logistics business macro

-14% of India’s GDP is spent on Logistic
-Organized market is 42%
-Growing at 10-15%
-Employs 2.2 cr
-Achieved Infrastructure status
-FY 14-18 attracted 1,00,000 cr FDI (2/n)

What’s the business?

Logistic is traditionally seen as a warehousing & transportation business where goods, needs 2b transported 4m point A to B using Road, Rail, Ship or Air & can be stored at multiple warehouses before the consumer receives the product (3/n)

The business landscape is changing fast with newer competition and technology is challenging the older business models. 3PL (3rd party logistics) & 4PL is one such change in the business of logistics, will discuss about the same ahead. (4/n)

Listed companies involved in the business may or largely may not own the Trucks, Rails, Aircraft, Ships, Warehouses etc., but uses outsourced services of other vendors and the listed companies manage the logistics from point A to point B (5/n)
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Have been bullish on #gold since $1786, Gold at $1910 today.

#investing
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Does increase in Inflation & hence interest rates lead to a fall in equity? While theoretically yes, practically the last 20 years of data shows otherwise

Please ‘re-tweet’ 🧵& help us educate more retail investors

#Investing

Lets start with basic, y does inflation ⬆️?
Most feel bcoz of higher demand & lower supply but that’s nt the only factor. Imagine there is a shortage of laptops wrt the demand, but there is no liquidity in the market (people don’t have monies) will the price of laptop ⬆️? No

So, Inflation takes place because the demand supply situation is accompanied by high liquidity, people have the monies to spend and hence the price goes up. Inflation does not take place only because of the demand supply gap (3/n)

Its RBI’s job to keep inflation under check. What role does RBI play? RBI is comfortable keeping Inflation between 2-6% currently. So if Inflation is increasing, how can RBI control it? Can RBI do anything to demand & supply? Nothing (4/n)

So the only tool available with RBI to control inflation is controlling liquidity. If RBI is able to reduce liquidity in the market, less money will chase the goods and hence Inflation can be expected to stabilize. (5/n)
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@kirtan0810
In this #IPO frenzy market, lets talk (Thread) about some basics around
-Angle/VC/PE
-Allotment process
-IPO Funding
-Grey Market

Hit the ‘re-tweet’ & help us educated more investors (1/n)

Why do companies come out with an IPO?

(a) Funding needs
- Business expansion plans
- Debt payoff

(b) Non-Funding requirement
- Enhancing corporate stature
- Exit options to large investors like the VCs & PEs (2/n)

While most of us believe IPOs are for funding requirements, you deep dive and understand it’s more of an exit channel for large investors (VC/PE). Let me explain the same concept from a start-up's perspective (3/n)

If u r starting off ur entrepreneurial journey & need capital, how do u raise funds?
-Self Funding
-Friends & Relatives (F&R)
-Bank Loan
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Angel investors r the 1s who invest @ the idea stage & PE/VC who invest in the growth phase of the company.(4/n)

- Self funding can be the best option but everyone’s not prepared
- F&R I wish helped
- Bank loans need collateral and
- Angel investors invest only when they see scalability in the business and hence a belief that they will get their investments back. (5/n)
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A Thread 🧵on how bond yields impact stock market ?

Must read for beginners in #StockMarket.

(RT to maximize reach.)

#Bonds #BondYields #StockMarket #Investing


What is #bond ?

Bonds are issued by governments and corporations when they want to raise money. By buying a bond, investor is giving the issuer a loan, and issuer agrees to pay the investor back the face value of the loan on a specific date, and to pay periodic interest as well.

What is bond yield ?

Bond yield, on the other hand, is the return that an investor gets on that bond or on a particular government security.

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Relation between #InterestRates, #BondYield and #BondPrice :

A fall/rise in interest rates in an economy pushes up/pulls down bond prices. However, bond yields fall/rise in this situation.


Effect of Bond Yields on Economy & #StockMarket :

Rise in bond yields denotes higher interest rates in economy. This increases borrowing costs for companies & consumers. This ultimately reduces overall demand in economy & negatively impacts #StockMarket.
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A basic and compressed learning on Fibonacci Ratios
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What are the top 5 rules or 5 hacks of personal finance that you swear by and use in your daily life?

Curious to know how different sets of people approach personal finance
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Hardik
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5 RULES TO IDENTIFY A STRATEGY THAT WORKS:

There are plenty of trading systems available on the internet and there are many trading systems providers.

But how do you know which ones are going to be potentially profitable?

1/ PREMISE OF THE STRATEGY:

The most important factor in any trading system is the premise or philosophy or logic on which it is built.

The systems must be able to identify certain repetitive behaviors which are inherent to any market.

An example could be #trend or #momentum or #mean reversion etc.

The magnitude of these behaviors could vary over time but they are natural to any markets.

Better yet, you should have multiple systems that attack these behaviors...

This is what I call the Hybrid Approach !!!

2./ SIMPLER, THE BETTER:

Once you have understood the logic behind the system, make sure it's based on simple rules.

If there are more rules, it’s a red flag that the systems are probably over-optimized or curve fit to past data which is unlikely to work in the future.

Most of my strategies have no more than 5-6 rules.

That’s it.

Keep it Simple, Stupid!
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ᴀɴɪsʜ ᴍᴏᴏɴᴋᴀ...
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Pharma learnings 101:

Higher the difficulty to manufacture, Lower the competition, Higher the pricing power.

Higher the regulatory oversight, the Bigger is the moat for those who comply.

#PharmawithJST
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Sculpture of Bhagwan Shiva as the destroyer of the Asura Andhaka - Cave 29,Ellora caves

Asura Andhaka hangs on to a trishula held by 6-armed Shiva.

Once Parvathi & Shiva were relaxing in the pleasant gardens of Mount Mandhara.


Bhagwan Shiva sat down there to enjoy the happiness.Parvati closed the eyes of Shiva playfully & darkness covered the whole universe.Parvati was perplexed & her palms were wet with perspiration.A few drops of her sweat mixed with sweat from Shiva’s body& fell to the ground.

From this sweat,a fierce creature was born,it started to roar.Child was born blind as Shiva's eyes were closed so was named as Andaka.Andha means darkness&also ignorance.Around the same time Asura Hiranyaksha was performing rigorous tapas Shiva for a boon of powerful son.

Bhagwan Shiva was pleased by tapas of Hiranyaksha & blessed him with darshan.Hiranyaksha asked for a powerful son,Shiva told him that he cannot have his own son,but can adopt a blind child who would become very powerful later.Shiva gave child Andaka to Hiranyaksha.

Hiranyaksha returned to his kingdom with Andaka.Later after the vadh of Hiranyaksha, Andaka is said to have lived with his cousins.He was ridiculed,so dejected Andaka went to forest.He did severe tapas for over many years towards Brahma Dev. Brahma dev appeared before him.
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@HiteshAwasthi89
Varahi Amman, Madurai, Tamilnadu

Vaarahi is one of the Saivite Shakti deities with the group of goddesses known as SAPTAMATAS.
They are: Brahmi, Maheshwari, Kaumari, Vaishnavi, Vaarahi, Mahendri and Chamundi. 1/n


They are the Shakti (female) equivalents of their male counterparts. Vaarahi is the Shakti of Bhairavar who is one of the Amsam of Bhairavar.Created from the boar avatara of Vishnu, Vaarahi is often associated with Goddess Kamala (one of the Mahavidyas). 2/n


She is also called Dandini (Lady Commander of the forces of the Mother-Goddess, symbolizing the might of SriVidya). As Vaarahi ("hog-faced" or "the great consumer") she destroys evil forces that obstructs the devotees' progress, paralyses the enemies 3/n


and led the devotees ultimately to SriVidyas. She is also called Panchami). With Kurukalla, she is accorded the parental status to Sri-Chakra (Lalita Tripura-Sundari). While Kurukalla represents the full moon, Vaarahi represents the new-moon. 4/4

Jai Maa Varahi 🙏


Tag for 📷 credit
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THREAD: Meditations on marriage metaphors in Ruth

The book of Ruth is, of course, a story about a beautiful marriage. But even before the courtship and the wedding and the important genealogy at the end, we find interesting language that is strikingly reminiscent of Genesis 2:24


That important verse reads:

'Therefore a man shall leave [יַֽעֲזָב] his father and his mother and hold fast [וְדָבַ֣ק] to his wife, and they shall become one flesh.'

The verb עזב can be quite strong in force. For example, Joseph leaves behind [וַיַּעֲזֹ֤ב] his garment as he flees from Pharaoh's wife's sexual advances. Countless times, Israel is depicted abandoning the LORD, for example in Judg 2:12 [וַיַּעַזְב֞וּ], and going after other gods.

Likewise, the verb דבק is rather striking. Lot is mortified of disaster overtaking him [תִּדְבָּקַ֥נִי] as he flees from Sodom. Israel is commanded in Deut 10:20 to cling fast [תִדְבָּ֔ק] to the LORD and serve him and swear by his name.

Together they illustrate how radical God designed marriage to be. Marriage is a real severing of family relations in order to form a new, permanent bond with another human being.

Something very similar to this takes places in Ruth's life.
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Hindu Media Wiki
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Speech Delay is most common in children nowadays

In ancient times, our grandparents used to follow typical natural way of caring the needs of a child. All they used were more of natural products than chemical based for the growth of child.


One of major step followed was to feed Gurbach Jadd/ Vasa Kommu/ Acorus Calamus for initiating good speech ability in a child. This stem was needed to babies on Tuesdays and Sundays in mother's milk.

Vasa is feed to baby after the 1st bath on 12th day in week. Weekly only thrice it is fed and named as :

Budhwar - Budhi Vasa
Mangalwar - Vaak Vasa
Ravi Vaar - Aayush Vasa

This stem is burnt and rubbed against the grinding stone in mother's milk or warm water to get a paste


The procedure to make it is in the link

https://t.co/uo4sGp7mUm

It should not be given daily to the child. Other main benefits are

1. It clears the phlegm in child's throat caused due to continuous milk intake. It clears the tracts and breathing is effortless.
2. Digestion

For children who haven't got their speech and is delayed than usual should feed this vasa on these days in week atleast for 6months. Don't get carried away with this dialogue
"Some gain speech little late"
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Catch me if you can @Mitesh_Engr

Time for a🧵
Mitesh Sir's EXPIRY Option Selling 101:
• What to look for?
• Strike Selection & Ratios
• SL mgmt
• Avoiding freezes
• Monthy Expiry
• Event days
• How he would have traded last expiry?

In collaboration with @AdityaTodmal


Edward de Bono says intelligence is like a🚗 Automobile

“A powerful car may be driven badly. A less powerful car may be driven well. The skill of the car driver determines how the power of the car is used.”


What @Mitesh_Engr Sir looks at for Expiry Trading:

• Technicals of BNF
• Individual Heavyweight stocks of BNF
• Support/Resistance of BNF on weekly TF
• Also has Superb SL management
• When it comes to adjustments, he is always on toes


How to Select Strikes to Sell?

• You can't sell based on premium
• Follow only trend
• Price action is best to sell on expiry day
• Never wait for the options to go to zero


Using Ratios to Sell:

• If BNF is in a range then strangles
• If breakout/ breakdown from a range then directional
• Selling 70/30 or 80/20 ratios
• 2 examples on how he used ratios
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