Best Finance Network
Get the best connectivity about finance.

On January 14, you must have seen the skies filled with colorful kites soaring high up. Makar Sankranti falls on the day when the sun leaves the tropic of Cancer towards the tropic of Capricorn, which is called Makar in India.

In other parts of the country, this festival is referred to as Poush Sankranti, Pongal, and Uttarayan. Farmers celebrate this day as it marks the end of the winter and ushers in the harvesting season.

Significance of kite flying on Makar Sankranti

Sankranti means movement and kite flying represents the thankful attitude of humans for this movement. It also has a scientific significance. As the sun commences its journey towards the tropic of Capricorn, it emanates useful rays. When you fly kites on this day, you expose yourself to the beneficial sunrays that have medicinal advantages.

Although Makar Sankranti is over, it is essential that you know about several important lessons this auspicious festival teaches as these teachings may prove to be beneficial during financial planning. Listed below are six important lessons this festival teaches you.

1. Be ready for movement

When you undertake investment planning, you have to understand that it is not a static one-time procedure but requires constant movement. You need to continuously monitor the performance of your long-term investments and make modifications when necessary. Additionally, you need to review and analyze market conditions to identify good opportunities that offer economic advantages to your investment portfolio. When you consider different financial instruments, it is crucial you consider your investment objectives to make the right decisions. This customization of your investment portfolio is comparable to personalizing your kite that has the perfect string which allows it to soar high in the clear skies.

2. Keep your eyes on your portfolio

When you fly your kite on Makar Sankranti, it is important to keep your eyes on it at all times. You must always be aware of how your kite is flying and in which direction. Similarly, prudent financial planning requires that you keep an eye on the performance of your investment portfolio. The performance of the various financial instruments must be in line with your short, medium, and long-term goals.

3. Maintain flexibility

As you fly your kite, you need the string to be kept flexible. This allows your kite to continue soaring amidst gusts of strong winds. This is true even with your short-term and long-term investments. Their performance will not always be the same and there may be ups and downs. Furthermore, the investment environment is not always conducive because conditions are never perfect. There is a possibility that your portfolio may be in the red. You need to ride out the difficult times and remain patient. It is crucial you are flexible and willing to bear temporary losses in the short-term to reap long-term benefits. However, you must never lose sight of your investment objectives and make modifications that become necessary under changing environments.

4. Adequate safety

To ensure you do not injure yourself, you cover your fingers with tapes and bandages while flying a kite. Similarly, you need to ensure adequate security when investing in any financial product. You must protect your investments from significant market conditions.

5. Remain invested

When you fly your kite on Makar Sankranti, you stand the entire day to make gains. Similarly, when you invest in different financial instruments, it is important to remain invested for a longer period. It is said that time in the market is better than timing the market. Therefore, to maximize your gains through investments, it is recommended you hold these for a longer time.

6. Strike the right balance

During winters, days are short and nights are long and vice versa during the summers. However, on Makar Sankranti, the day and night are of an equal length. Just like that, when you invest, you must aim for the right balance between your risks and returns. You must choose financial products that suit your risk appetite while delivering decent returns on your investments.

Striking the right balance between risk and return requires adequate research and effective planning. You need to study the market conditions and understand the features of different financial instruments. This may not be an easy task especially if you are new to investing or have no experience in conducting such analyses.

Through the proprietary ARQ investment engine in Angel Wealth’s mobile application, you can achieve this balance. This engine uses algorithms and quants to analyze a billion data points and offers recommendations that suit your financial objectives and risk appetite. There is no human intervention in the entire procedure ensuring the recommendations are completely unbiased.

Download the Angel Wealth mobile app and apply the lessons learned from Makar Sankranti into practice.

The listing of a private company on the stock exchange is known as Initial Public Offering (IPO). It is at this point that investors are invited to bid for buying the shares of the company that was held privately thus far. Based on the past performance of the company, the offer price range is determined and once all bids are received, generally shares are allocated on a pro-rata basis.

The crazy chase to invest in IPO

IPO investments attract a lot of investors as it has the potential to give very high returns. It is believed that the investment made at the time of IPO give high returns at the time of listing. However, as with other types of equities, there is a high risk involved when you invest in an IPO.

The funds raised through an IPO are used for several purposes by the company. These include clearing off debts, expanding and improving their operations, or using it to meetworking capital needs.

Before you choose to invest in IPOs, you must remember that all IPOs are not open to general public. The underwriters choose the category of people for which the IPO is opened.

If you opt to invest in IPOs, you must be aware of the risks associated with these financial products. Here are four things you should keep in mind while investing in an IPO.

1. All offerings are not suitable for all kinds of investors. Consider your financial situation and goals before making a decision.

2. Read the draft red herring prospectus. This will help you understand how the funds will be utilized. The prospectus also provides information about the objectives and fundamentals of the company and its future growth prospects.

3. You must rely on facts and not fall prey to marketing strategies used by agencies to entice investors.

4. Analyze the promoters and their backgrounds. IPOs that have reputed institutions and government backing are safer.

Investing in an IPO must be a well-thought decision. It is important to ensure the risk level suits your personal financial situation and appetite. With IPO investments, you may make money or lose your capital; therefore, be cautious before you apply for one.

Investing in IPO through mutual funds

As mentioned before, if an IPO has institutional or government investments, the risks are significantly reduced. Until recently, mutual funds did not invest in IPOs because of the high risks. However, that is no longer the case. Mutual funds have recently begun investing in quality IPOs issued by small and medium enterprises (SMEs).

Here are three benefits of investing in IPOs through mutual funds.

1. Investing in mutual funds online for retail investors is easily available and provides greater flexibility. You are able to gain exposure to the stock market at an affordable entry price.

2. The schemes are managed by experienced professionals who analyze and study the IPOs and the overall market. This reduces your risks because the fund managers and their research teams do the homework for you. Moreover, you are able to diversify your portfolio further reducing your risks.

3. IPO allotment often happens on a pro-rata basis. Therefore, you may be allotted less than the applied number of shares. However, institutions have a preferential allotment, which is beneficial.

Equity-linked saving schemes, or ELSS, are essentially close ended mutual fund schemes that offer tax benefits under the section 80C of the Income Tax Act, which means that you can reduce your tax liability. Such funds do not have any restriction on number of shares issued. They are diversified thereby allocating capital in a variety of assets in a way that reduces exposure to risk thereby mitigating loss schemes offered through mutual funds.

The unique feature of this scheme is that one can avail a maximum deduction of Rs. 1.5 lakh invested into these funds from his/her income during a financial year. This in turn, would help in saving tax of up to Rs. 46,350/- (if one falls in the highest income slab) during a financial year. ELSS also offers greater liquidity as the lock in period in these funds is only 3 years in comparison to PPF which has lock in period of 15 years. Further, by choosing for the ‘Dividend Payout’ option in the ELSS, investors can receive tax free dividends from their investment prior to the maturity of the scheme. Thus, these funds are efficient tax saving investments with the least lock in period and a superior performance track record.

This is a hugely underappreciated advantage of investing in an equity-linked saving schemes. Many prefer instruments such as Public Provident Fund, life insurance policies that are comparatively long term instruments where the primary goal of investing is either safeguarding your loved ones after you are no more or in the case of PPF whereby the idea to save for retirement.

While one can look at ELSS purely from a tax saving perspective of saving taxes, they can also serve as investments towards long term goals. The equity element in ELSS allows investors to systematically create wealth in the long run.

When the main area of interest is associated with litigation funding, then there are various issues associated, which lawyers are still struggling. To minimize the problems, associated with contingency fees, the jurisdiction level has made a new law where the borrower or the client has to pay the money to a lawyer, appointed by him. In maximum instances, the loyalty is owned to someone from whom the money has been borrowed. On the other hand, the risk factor of the lawyer is mostly related with the contract made by clients. When the main area of interest is related with lawsuit lawyers, then he holds the major power to decide whether to take advantage of litigation cost or not, if it is not worth it.

Previous cases are not same

In former times, it can be seen that lawyers used to charge a particular fee to their clients, who are associated with lawsuit cases. The client can either pay the amount entirely or can wait for the monthly fees scheme. However, this practice kept on changing, after checking the profitable level of the attorneys. On the other hand, during previous cases, the payment created confusion between the attorney and his clients. It is an inevitable truth that the lawyer needs to be paid his exact fees, no matter what is the outcome of any lawsuit case. Even if a person loses the settlement case, still he is liable to pay a stipulated amount to the attorney. Moreover, in other cases the lawyers can even charge for an hourly rate, as per his sweet will.

Focusing more towards litigation fees

It has been found out that the litigation fees have already shifted the risk and cost factor associated with litigation services. In this respect, the lawyers just need to bear the risk associated with financing cost, which will be higher than the estimated amount. In this respect, the lawyers can work on the golden opportunity to keep the incentive for lower costing level. On the other hand, it has also been found out that the lawyer’s incentives can be aligned with the notification of the clients. This is the result due to share in the field of increased recovery financial services, which come with extra investment policies.

Other measures to have taken

There is another measure, which mingle the relationship between lawsuit funding and attorneys. When the cost shifting procedure is revolving around the client and lawyers, then the clients can easily take help of third party, to bear the financial services on someone else. This case might involve the workings of insurance companies; where else the corporations are going to pay for the employees and their officers. On the other hand, parents can also take an active part in this segment, by focusing more towards payment for their children or spouse.

No ethical problems arises

There are different kinds of lawsuit funding solutions, which are provided to the interested candidates and other lawyers, associated with the lawsuit funding field. However, it has also been found out that there is no moral problem associated if the lawyers look for new funding forms, for defending case. Moreover, it has also been found out that, from recent times, lawyers were given the liability to take help from banks for running their cases. They can even take help of non-recourse funding option, which is another significant part to lay focus.

Choosing the right lender

In case of banks fail to help the attorney with financial support, they can easily take help of lawsuit lenders. However, it is the duty of an individual to check the background of the lenders before opting for attorney lawsuit lending services.

John Sigmon is a world class name with special emphasize of various forms of lawsuit funding solutions. He is also known for offering monetary services to various lawsuit attorneys, related with alternative litigation funding areas.

You work hard for the money you earn, so saving money might not be a priority. However, it is important that you have an emergency fund in case the unexpected should occur. My mentor and first boss at my management training program taught me these five reasons you should have emergency savings.

1. You lose your job: With the struggling economy, companies are being forced to lay off employees. Just because you are an outstanding employee does not mean you are not susceptible to unemployment. In addition, you could be the victim of health issues, so you cannot work. Whatever the reason, having an emergency fund will help pay the bills while you are not working.

2. Medical Bills: You never know when you will encounter a major medical condition. You could be diagnosed with a disease, or you could be in an accident that could result in serious injuries. Your medical insurance will only last for so long before you are required to pay the bill. A savings fund will help you pay the mortgage and other bills, so you can avoid foreclosure.

3. Your car decides to quit: You are driving down the road, and you hear a loud clanging noise. You take your car to the mechanic, and the news is not good. You must have a car to get to work or to the store. You will then decide if it will be cheaper to get the car repaired or just buy a new one. Your emergency savings account will prevent you from going into debt.

4. A family member dies: If a loved one dies and you need to get to the funeral, you can dip into your emergency savings to purchase a plane ticket. If you drive, gas is expensive, so you will need extra money to cover the cost. You might also need to help cover funeral and burial expenses.

5. Home Repairs: Your air conditioning goes out in the middle of the summer, or your roof starts leaking during a flood. Your refrigerator might decide to quit working. In addition, you never know when your home insurance might suddenly increase. By having emergency savings, you will be able to pay the bill without putting it on your credit card or taking out a loan.

Emergency savings can prevent you from having serious debt problems or from selling off your assets. If you have invested in gold for instance then that’s something you want to be able to hold on to. You can use the money from your savings account rather than going deeper into debt. Saving money is important to prevent financial problems.