Sunday, October 28, 2007

Investment Options in India

Bank FDs
  • Very low risk and low liquidity.
  • Low returns, but assured. Depending on the tenure and bank, could be around 6-9%
  • Since returns are fully taxable, the post-tax returns will be still lower.
  • Good for very low risk investors and those in the nil or low tax brackets. As interest rate scenario seems to be peaking, one could consider investing in 3-5 year FDs.
FMPs
  • Low risk and low Liquidity.
  • No assured returns but depending on tenure and the MF, could be around 6-9%. (Ability to deliver the indicative returns).
  • MFs attract much lower taxation and hence give better post-tax returns vis-à-vis Bank FDs.
  • Good for low risk investors, but in high tax brackets. Good for investing the debt portion of one’s portfolio.
Floating Rate Funds
  • Low risk and high liquidity.
  • Market linked. Today could be around 5-7%.
  • Lower taxation of MFs makes Floating Rate funds attractive.
  • Good for investing short-term money where one needs higher liquidity.
Debt Funds
  • Low to Medium risk. High Liquidity.
  • Returns are market-linked. Today could be around 5-7%, but susceptible to interest rate risk.
  • Lower taxation of MFs makes such funds attractive.
  • Can be avoided in a rising interest rate scenario but is good in a falling interest rate scenario.
Post Office Schemes
  • Low risk and low Liquidity.
  • MIS scheme give 8% interest. Time deposit 6.25-7.5%.
  • Since returns are taxable, the post-tax returns will be still lower.
  • Good for very low risk investors and those in the nil or low tax brackets.
PPF
  • Low risk with very low liquidity (15-year lock-in period. Partial withdrawal allowed after 6 years).
  • 8% assured returns. Interest is tax-free. Also Sec 80C benefit. Hence a good scheme.
  • Good tax saving investment option. Good for investing the debt portion of one’s portfolio.
NSC
  • Low risk with low liquidity (6 years lock-in).
  • 8% assured returns.
  • Interest fully taxable. But eligible for Sec 80C benefit.
  • Not very attractive vis-à-vis other options like 5-year Bank FDs.
Equity
  • High risk and high liquidity.
  • Market linked returns. Good potential.
  • Attractive tax treatment. No Long Term (investment of more than 1 year) Capital Gain Tax and 10% Short Term Capital Gains Tax.
  • Needs high risk appetite. Ideal for those investors who have a good corpus, good knowledge and time to track the markets regularly. Care should be taken to invest in good profit making companies. Penny stocks should be avoided.
Equity Funds
  • High risk and high liquidity in open-ended funds.
  • Market linked returns. Good potential.
  • Attractive tax treatment. No Long Term Capital Gain Tax and 10% Short Term Capital Gains Tax.
  • Ideal for small and common investors, but with high risk appetite. SIP and a long term investment horizon can cut down risk and increase the probability of making good returns. Ideally, one should build a well-diversified portfolio with say 40-50% money in 5-7 diversified funds (large cap oriented), 20-30% money in 3-4 mid/small-cap funds, 10-15% in 3-4 sector funds and 10-20% in balanced funds.
ELSS Funds
  • High risk with low liquidity (3 years lock-in period).
  • Market linked returns. Good potential.
  • Attractive tax treatment. No Long Term Capital Gain Tax and 10% Short Term Capital Gains Tax. Also Sec 80C benefit.
  • Good tax saving investment option. Amounts beyond Rs.1 lakh limit could be invested in open-ended funds. SIP in ELSS would reduce the volatility risk.
Balanced Funds
  • Medium to High risk. High Liquidity.
  • Medium to high returns. Market linked.
  • Attractive tax treatment. No Long Term Capital Gain Tax and 10% Short Term Capital Gains Tax.
  • Though convenient as both debt and equity investment is covered under one fund, it may be better to invest separately in equity and debt funds for better control.
ULIPs
  • Low to High Risk depending on the investment option i.e. Pure Debt or Mixed or Pure Equity. Low Liquidity (3-5 years lock-in period).
  • Low to high depending on the investment option. Market linked returns.
  • Tax free returns.Allso Sec 80 C benefit available.
  • Not an attractive option due to high charges, low flexibility and low diversification. There are other better similar investment products like MFs with low charges, high flexibility and high diversification. As regards life cover, the same could be done through a term policy.
Endowment/Moneyback Plan
  • Low risk and very low liquidity
  • Low returns. Generally around 6-6.5%.
  • Tax free returns. Also Sec 80 C benefit available.
  • Not an attractive option due to low returns. There are other better similar investment products like PPF. As regards life cover, the same could be done through a term policy.
Real Estate
  • Variable risk and variable liquidity depending on the type and location of property.
  • Market linked returns. Good potential.
  • No tax advantages, except attractive tax benefits on the home loans.
  • High initial investment required which could make one’s portfolio lopsided; high transactions costs like title-search, registration brokerage etc.; and cannot be partly liquidated. Therefore, real-estate MFs (expected in the near future) may be a better alternative than direct property investment. If investing directly, it is important to assess the potential and clear title.
Commodities
  • High risk with high liquidity.
  • Market linked returns.
  • No tax advantages.
  • Highly cyclical.
Gold
  • Low long-term risk. But volatile in short term. High Liquidity.
  • Has traditionally been a hedge against inflation. So returns could be around inflation levels.
  • No tax advantages.
  • Not an attractive investment option. Can be used for portfolio diversification to partly hedge against inflation. Gold MFs are better than buying physical gold.


AdvertisementGet great discounts on Amazon.com Textbooks

Monday, October 8, 2007

JConfig

jConfig is an extremely helpful utility, arming the developer with a simple API for the management of properties. Parts of the implementation are based on the idea that Properties, from Java's perspective, are a good thing, but can be better. jConfig employs the use of XML files for storing and retrieving of property information. The information can be stuffed into nice categories, which makes management quite a bit simpler. The ability to load from a URL is also a nice feature. It allows for a central repository where multiple instances of jConfig can read a single file. The nifty ability to switch between XML and Properties files isn't fully exploited yet, but will be coming soon. That will mean that the developer would take their existing Properties files and export them to XML. That means less time to get up and get going with jConfig.

My team is planning to use JConfig in one of the upcoming projects. If you have a view on JConfig, plz share that experience. Or, if you are using some alternative, that would also be helpful.

Link: JConfig(1) JConfig(2)


AdvertisementGet great discounts on Amazon.com Textbooks

Tuesday, October 2, 2007

Monitor and diagnose performance in Java SE 6

Java™ Platform, Standard Edition 6 (Java SE) focuses on performance, with expanded tools for managing and monitoring applications as well as diagnosing common problems. This article outlines the basis of monitoring and management in the Java SE platform and provides detailed information about the relevant enhancements in Java SE 6.

Java SE 6 provides an in-depth focus on performance, offering expanded tools for managing and monitoring applications and for diagnosing common problems. The improvements include:

  • Monitoring and management API enhancements
  • Official support for an improved graphical monitoring tool called JConsole
  • Enhanced instrumentation of the Java virtual machine (JVM)

This article outlines the basis of monitoring and management in the Java SE platform and provides detailed information about the performance monitoring and management enhancements in the latest release. It also describes the diagnostic and troubleshooting tools available in the Java SE 6 platform.


Link: Monitor and diagnose performance in Java SE 6



AdvertisementGet great discounts on Amazon.com Textbooks

A

Popular Posts (Last 30 days)

This is a personal blog and I do not speak for my employer.