Wise Investing

Why gold price move It is said that gold is an Inflation hedge. Whenever Inflation goes up, Gold prices go up. But if you look at the historical data points, Gold has not really been able to live upto the expectations. (Q1) What really moves gold prices? It’s not just inflation but a combination of Inflation & Interest Rates that moves Gold prices. Real Rate of Return like we call it moves the gold prices. (Q2) What is a real rate of return? Real Rate of Return in simple language is, Interest Rate – Inflation. If bank FD is paying you 5% & inflation is 6%, your real return is 5% - 6% = -1% & if inflation is 3%, your real return is 5% - 3% = 2% (Q3) What’s the relationship between real rates & gold prices? (a) Negative Real Rates (-1% in the above example) is supportive of gold prices (b) Positive Real Rates (2% in the above example) works against gold prices (Q4) Why? (a) Gold is a non interest-baring instrument i.e. does not pay any fixed interest.  (b) Hence, when...

 Six investment myths/mistakes you should ignore    When you are a new investor, you must ensure to avoid falling into the trap of investment myths that swirl all around us. Let us find out what those myths are    As a new investor, when you ask about good market strategies, the experts may give you several ‘truisms’, which may not actually be true. So, you should be quite careful as you begin your investment journey. In fact, what perhaps you believed to be the key tenets of the investment may turn out to be investment myths.    Let us shed light on the six investment myths that you must ignore:    1. Waiting for the market to fall before investing: It is often believed that investors should buy the stocks at the right time when they are trading lower. Although this is an ideal thing to do, sadly no one knows the right time. So, if the stock you want to buy is available at the right price, you may buy it. If you wait too long, you may not ge...

 What is US dollar index? The US dollar index is used to measure the value of US dollar against a basket of six major worth currencies of the US’ significant trading partners. These currencies are Euro, Swiss Franc, Japanese Yen, Canadian dollar, British pound, and Swedish Krona. The value of the index an indication of the dollar’s value in global markets. A higher reading means a stronger dollar.  The dollar index was established in 1973 after the Bretton Woods Agreement dissolved with a base of 100.  The Euro makes almost 57.6 percent of the basket and is the largest component of the index followed by Japanese Yen with 13.6 percent. GB Pound has 11.9 percent weightage, Canadian dollar 9.1 percent, Swedish Krona 4.2 percent and Swiss Franc has 3.6 percent weightage. How does it affect Indian markets? The Indian rupee (INR) is not included in the basket of currencies in the dollar index However, any change in the index has an impact on the rupee as well. The appreciation ...

Hello everyone let us understand impact of crude oil on Indian Markets  The Impact of Crude Oil Prices on Indian Stock Markets understand the impact of oil prices. A rise or fall in crude oil prices affects the prices of various commodities. An impact on the prices of commodities affects companies. The recent decline in the crude oil prices has helped improve investor sentiments in Indian markets. Here are a few points that explain the impact of crude oil prices on the Indian stock markets: Current Account Deficit (CAD) and Rupee depreciation: Every U$10/bbl increase in oil price leads to a 0.55% or 55 bps increase in the current account deficit. Crude oil is one of the most important commodities in recent time. India is one of the largest importers of oil in the world. It imports more than three-fourths of its oil needs. Therefore, a fall in the price of crude oil will have a positive impact on India’s current account deficit situation. Lower CAD will mean reduced stress on foreig...

 Hello friends let us understand this  How changes in MSCI index impact Indian stocks MSCI has announced the results of their Semi-Annual Index Review. The effective date for the index rebalancing is November 26. In India, there are 78 changes, which cover not just additions and deletions, but also weight changes due to various factors. MSCI has added eight stocks and deleted four from its Global Standard Index. The additions included Berger Paints, Colgate, DLF, HDFC AMC, ICICI Prudential Life, SBI Life, and Siemens. Meanwhile, the deletions from their global index include Glenmark, Indiabulls Housing, Vodafone Idea, and Yes Bank. In their India Domestic Index, MSCI has added 8 stocks while removed 6, while they have added 13 and deleted 21 stocks from the MSCI Global small-cap index.

 Hello everyone Much awaited IPO  The bourse is likely to be valued at over ₹2-lakh crore The much-awaited initial public offering of the National Stock Exchange (NSE) could be rolled out in the next few weeks since market regulator SEBI is all set to allow the bourse to re-file its prospectus for the share sale. NSE will launch India’s biggest IPO post-SEBI nod as it is likely to be valued at over ₹2 lakh crore. In the unlisted market, NSE’s shares are currently quoting in the broad range of ₹3,000- 4,000 apiece. IPO plan The NSE had first filed for its IPO with SEBI in December 2016, two months before incumbent SEBI chairman Ajay Tyagi took charge. Then, Tyagi ordered the exchange to withdraw its offer documents since it got embroiled in the algo trading scandal. A SEBI investigation was ordered into the alleged data theft and preferential access scam at NSE co-location servers. In May 2019, SEBI framed charges against senior NSE officials and ordered the exchange to pay ove...

 Hello everyone  Simply put, NFTs (Non-Fungible Tokens) are a way to prove digital ownership. Here are the top 3 things we think you should know about them, so you can use them safely and easily as an artist or art collector. They are built on blockchains. These are distributed public ledgers that record transactions. Each NFT is stored on the blockchain with an identification code and metadata that makes it as unique as a fingerprint. In this context, “metadata” means “data about data” and is simply a bit of extra information that describes the NFT and is stored alongside it. They’re an excellent way to mark digital assets and control their supply. Whether you’ve created a piece of music, a digital artwork or video, “minting” it as an NFT means that you can prove ownership over it (as each NFT is distinct and traceable). Previously, digital assets were fairly easy to steal. This is huge as it means artists can’t be cheated out of royalties anymore and collectors don’t have to...