Investment Options

1. Open-ended schemes Open-ended or open mutual funds are much more common than closed-ended funds and meet the true definition of a mutual fund — a financial intermediary that allows a group of investors to pool their money together to meet an investment objective— to make money! An individual or team of professional money managers manage the pooled assets and choose investments, which create the fund’s portfolio. They are established by a fund sponsor, usually a mutual fund company, and valued by the fund company or an outside agent. This means that the fund’s portfolio is valued at “fair market” value, which is the closing market value for listed public securities. An open-ended fund can be freely sold and repurchased by investors. Buying and Selling: Open funds sell and redeem shares at any time directly to shareholders. To make an investment, you purchase a number of shares through a representative,Continue reading

Commodity exchanges in Indian are still at a nascent stage, and there are numerous bottlenecks in the growth of the commodity futures market. The challenges facing the Indian Commodity markets are very serious in nature and cannot be ignored as they can paralyze the agricultural futures markets, much against the objective of agricultural liberalization. The main problem is that the commodity markets are under the control of Government. Towards the growth of any market, the trading conditions or the terms and conditions of contracts play a crucial role. The contracts should be market friendly in terms of attracting both the big and small traders alike. In majority of the contract specifications, it was found that the size is too big for small traders and producers to trade. Unless such finer aspects are dealt with proper attention at the regulatory level and the exchange level, attracting small traders and farmers intoContinue reading

In the wake of consistent rise of rate of inflation during the first quarter of calendar year 2007 and responding to the concerns expressed at various forums, Parliamentary Standing Committee of the Ministry of Consumer Affairs Food and Public Distribution, appointed an Expert Committee under the Chairmanship of Prof. Abhijit Sen, Member of Planning Commission, to examine whether and to what extent futures trading has contributed to price rise in agricultural commodities. The objectives of the committee were: 1. To study the extent of impact, if any, of futures trading on wholesale and retail prices of agricultural commodities 2. Depending on this impact, to suggest ways to minimize such an impact 3. Make such other recommendations as the Committee may consider appropriate regarding increased association of farmers in the futures market/trading so that farmers are able to get the benefit of price discovery through Commodity Exchanges. In order to examineContinue reading

The Indian commodity futures market has grown exponentially in the recent times. With the increase in trade volume at the Commodity Exchanges; the need to have a vibrant and efficient settlement system was felt. This led to the concept of dematerialization of warehouse receipts. Demat of warehouse receipt eliminates the difficulties arising out of the use of physical warehouse receipts. Dematerialization refers to the process of conversion of the physical paper (i.e. share certificates, warehouse receipts, etc.) into the electronic balances. In this process the physical paper is destroyed and electronic balance is credited in the demat account owner of the physical document. The concept of demat has been in vogue in the securities market from the year 1996 with the setting up of the first depository i.e. National Securities Depository Limited (NSDL) to remove the difficulties arising out of the use of physical (paper) certificates for settlement of tradesContinue reading