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Personal Financial Investment
Girish Sawant
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Disclosure
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What is mean By Investment
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Investment
Stock Market
Charity
Mutual fund
Real Estate
Study
Physical
exercise
LifeInsurance
Job
Performance
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Definition
Investing is a actions to reap the benefit in
future.
Financial
Intellectual
Mythological
.so on
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Entering in Financialinstrument to reap thebenefits in the future
February 7,
2007
Financial Investments
Saving is not investment if it is not
with above intention, it is liquid asset
available for investment
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Behavioral Finance
is the study of how emotions and cognitiveapproach affects decision in financial
affairs
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Why to Invest - ERODING of Capital
Future Cost
Future Value100
105
118
130
145
160
178
200
10 0
110115
12 5
13 3
16 0
17 0
18 0
90
110
130
150
170
190
210
2001 2002 2003 2004 2005 2006 2007 2008
Prchasing Power Future Value
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Dont let it happen!!!!!!!!!!!!!!
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Comfort Levels / Savings Commitments
Resources / Incomes
Investment
Allocation Process Delays
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Success in investing doesntcorrelate with IQ once you
are above the level of 25.
Once you have ordinary
intelligence, what you need
is the temperament to
control the urges that get
other people in to trouble in
investing.
- Warren Buffet
What do you need to be successful Investor
It means intelligence is not directly proportional to successful investor
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." Sir Isaac Newton, one of the world's mostrenowned physicists, in 1720, after he lost in
stock market when the South Sea Trading
Company, in which he was an investor,
tanked.
Many of the investors in that company werewiped out. Newton had foreseen a stock
market crash and sold his shares early, for a
profit of 7,000 pounds.
Afterwards, however, Newton watched as
the bubble kept inflating and he bought more
shares. Unfortunately, he lost more than
20,000 pounds, which was a huge amount in
those days.
Wanna Challenge ???????????????
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Method of Investments
Intellectual
Physical
Emotional
Informed
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Liquidity
Term/ Time
Horizon
Type of
Returns
Risk
Open/Closed
Ended
Investment Instruments
Moveable /
ImmoveableType
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Investment is a Individual plan
Investment is a Individual plan which will vary dependingupon
Age
Liabilities
Capacity to earn/ lose
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Different Vehicle for Different Plan
Tractor & Truck
Distance - 800 K.m.
Load 8 T
Priority Medium
Cost of Transportation
Truck Rs.15/ KM
Tractor- Rs.8/ KM
Preferred Truck
Tractor & Truck
Distance - 80 K.m.
Load 12 T
Priority LOW
Cost of Transportation
Truck Rs.15/ KM
Tractor- Rs.8/ KM
Preferred Tractor
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Strategy Of Investments
Long
If one were to buy an investment product and ahold it.
Short - If one were to sell an investment product and thenbuy it
Trading - - If one buys & then sell an investment product
SpeculationInvesting in expectation sporadic
rise/decline in near future.
Hedging
Investing using the method of buying andselling different instruments at same time to ensure
profit.
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Prospect Theory
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Mental accounting
Prospect Theory
Loss aversion/Sunk Cost
Decision Paralysis
Endowment effect
Informed
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Challenging the Myths
I know the proper /exact value
I do not want to take risk hence I kept in savingaccount.
I am reasonably insured
Equity Exposure should be ( 100- age ) %
NFO means Cheap purchase
Dividend plans are better than growth
SIP is suitable for all
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Plan of actions
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Thank You
Happy
Investing