Vijaibabu's Blog - Personal Finance Guide for Financial Freedom

“Compound interest is the eight wonder of the world. He who understands it, earns it ... he who doesn't ... pays it.” ― Albert Einstein As time progresses some things just get better.. Red wine gets an enhanced taste while aged cheese is so much more tastier.Don’t you agree? Now what’s with Money?? It grows.. grows with time… And why?? Because it gets compounded. So what’s compound interest exactly? Its earning interest for interest already earned. In other words, your interest on savings also earns interest . Suppose you deposit some money in your account today, there will be an increase in the value of it after a year. And, that’s because it has earned interest. The journey to wealth can begin with even keeping aside the smallest amount each day. Don’t believe?? The picture below says a thousand words. Rs. 15000/- invested per month for 20 years will turn into more than Rs 1.13 crores. On the contrary, if you left it in a savings account, it would be worth...

Equities have out-performed other investment asset classes over the long-term in India as well as globally. With growing maturity, retail Investors in India have begun to realize this and also take into stride the short-term volatility of this asset class. Better regulatory environment and improved corporate governance have also helped bring more investors to Equities. Currently, retail equity investment in India is mostly channeled directly in stocks. I ndividual investors hold around 20% of the total equity market value, while mutual funds account for about 3%. This is almost the opposite of global trends where retail money is mostly professionally managed and mutual funds are the investment vehicle of choice for equities. Why should India be different? Does direct investing provide any benefit over investing in equity mutual funds? To answer this question, we conducted a study to compare the historical performance of Indian equity funds to that of the stock market over...