Money Today Archive December 2009 Issue

Edition: December 2009

Cover Story

Kapil Mehta

A mixed bag for insurance

For the life insurance industry in India, 2009 has been a year of transition.
  • Time to take on responsibility Many investor-friendly measures have been introduced in insurance, but they come with a rider. To enjoy the benefits, policyholders must be proactive.
  • Lessons from the financial meltdown By far the most contentious debate triggered by the crisis has been about the flaws in the regulatory architecture.
  • Staging a return to the basics The leitmotif of the banking story this year has been that there are no free lunches. The onus of protecting your interest lies squarely on you.
  • 'Asset allocation is crucial in downturns' In October 2008, nobody was willing to touch equities when they were available at great values. Now, with the markets returning to some normalcy, investors have come back.
  • Patience always pays The market volatility during the year underlined the importance of regular savings and diversification for the mutual fund investor.
  • Don't even try to time the market The year 2009 will be remembered as the year of revival. The Sensex, which had plunged to a low of 8,160 in March, bounced back and recouped most of the losses incurred after the fall from its all-time high of 21,200 in January 2008.
  • Learn to keep the faith The roller-coaster journey of the stock markets this year has taught the small investor never to give up on this asset class.
  • The Tier II and III real estate story In the current context, with limited capital available to real estate players, developers should focus on their core geographies.
  • Watch out for the real deal Customer was once again king as cash-strapped realtors tried to woo him, while speculators learnt the hard way the perils of leveraging.
  • Lessons from 2009 An abundance of financial lessons got compressed in the 12 months of 2009. We look at what investors ought to have learnt from the year of mega surprises.
  • Lessons re-learned in 2009 Always have an emergency fund. A stash of cash (or liquid investments) that will cover three to six months of expenses is absolutely essential, despite the low returns and tax inefficiency of cash holdings.
  • 'Brand loyalty remained high' According to Raghav Gupta, president, Technopak, the consumer was more cautious in 2009, but was unwilling to make too many compromises in his lifestyle and purchases.
  • Shopping for value, in style Inflation and zero increments meant less spending, but the consumer did not stay away entirely. He became a value hunter, a trait he must retain.
  • 'Employers have lower tolerance levels now' Kris Lakshmikanth, founder CEO & MD of The Head Hunters India, says that employees can expect more jobs in 2010 but the terms of employment are set to be strict.
  • The year of the employer Following the rulebook was the survival route for employees in 2009. Work discipline must now continue to ensure rewards and stability.
Tax
Babar Zaidi
The new tax scheduled to replace all indirect taxes next year would benefit the industry and boost the economy. Here’s how it will affect you.
Stocks
R. Sree Ram
The resurgence of economic activity is driving the demand for crude oil, which could translate to spillover benefits for the pipeline industry.
  • Less pain, less gain Though the bull call strategy helps minimise losses, it has a limited profit potential and high commission costs.
  • The sales impact Continuing the series on financial concepts, MONEY TODAY explains how the price to sales ratio can help an investor know if a stock is worth buying.
  • Winter weakness Let’s not get carried away by the euphoria in the markets because bad news could be just around the corner.
Insurance
Rakesh Rai
The Swarup Committee recommendations have given rise to debate and controversy, with insurance agents pitted directly against the panel.
Investment
Tanvi Varma/Money Today
Vikas Agnihotri, CEO, Religare Macquarie Wealth Management, talks about the strategies and avenues to invest in the current situation.
Travel
Tanvi Varma/Money Today
Lured by attractive pricing and the tag of exclusivity, more and more people are picking foreign locales and royal backdrops as wedding venues.
  • Green getaways Now you too can save the world, one eco-friendly holiday at a time. But to get your money’s worth, watch out for the faux green resorts.
Portfolio Doctor
Babar Zaid
With marriage on the cards, two couples want to know how it will change their financial planning and what they should do to achieve their goals.
Books
Kamya Jaiswal
Did you know the legendary ‘Hebrew talisman’, supposed to be the secret behind the Rothschild fortune, is actually the bond market?
  • In the write business With its simple style and realistic approach to dealing with the challenges of a start-up, the book is a mustread for aspiring entrepreneurs.
Query Corner
The compensation amount will be included in your total income under the head ‘Income from other sources’. It will be taxable as per the applicable tax rates based on your gross total income.
For The Record
Couched in excessive jargon and terminology, financial knowledge seems intimidating. However, good monetary management requires little more than common sense. Here’s how you can squeeze simple adages to derive economic ingenuity and explain financial rudiments.
Insight
The announcement of bonus shares shows that a company is confident of the future and, therefore, the stock price moves up.
Editors Note
By all accounts, this has been an eventful year. It hasn’t been bad enough for hacks to call it annus horribilis, but, to quote Queen Elizabeth, “It is not a year on which (we) shall look back with undiluted pleasure”.
Talk Back
Thank you for the critical input. Many readers have conveyed to us the difficulty they faced in navigating through three case studies.
Smart Spending
Sushmita Choudhury
In this series we review new products and services to help you sort the best buys from those that do not offer value for money.

December 2009

November, 2009

October 2009

September 2009

August 6, 2009

July 23, 2009

July 9, 2009

June 25, 2009

June 11, 2009

May 28, 2009

May 14, 2009

April 30, 2009

April 16, 2009

April 2, 2009

March 19, 2009

March 5, 2009

February 19, 2009

February 5, 2009

January 22, 2009

January 8, 2009