Through the Looking Glass

The Economic Times Choosing a financial advisor is like choosing your family physician. Once you are associated with him, it is difficult to restart with another. You have decided to do long term planning for yourself, but a big question remains: how does one choose a financial advisor? Here are a list of attributes that an advisor should have. Credentials Finance is a matter of trust. The most important element in your relationship with your financial advisors is the trust that he can build with you. To gauge his ability to win your trust, you should check his experience, client references, educational background and affiliation with national and international professional networks. A lack of experience may be compensated by references from clients who are satisfied. Many advisors insist that they cannot share the names of their clients to protect their confidentiality. However, there is no better endorsement than a satisfied customer. Becoming a financial advisor does not ...

DNA One needs to understand how big the retirement corpus needs to be to lead a comfortable life in the golden years Aman Jain, 27, is an MBA from a top-rated business school with a great job with a major retail chain. He has recently married his batchmate, Namita (also 27), who has a similar work-profile. Both live in a rented apartment in central Mumbai. Their parents have settled in their respective home towns and are well provided for. Both have good jobs which pay them Rs 35,000 each every month. They have now started thinking about their retirement. They need to understand how big their retirement corpus needs to be so that they can lead a comfortable life in their golden years. They both expect to retire at the age of 58. Let us understand a few concepts before determining their pre-retirement corpus requirement: 1. Life expectancy: With increasing medical progress, life expectancy is increasing. The average life expectancy in India is around 63 years. Urban and afflu...

DNA "Where do I park my money for the best returns?" is a standard investor query. The standard answer might well be, "put it in equities and forget it for 5-7 years." But, while there is no denying the power of equities to deliver phenomenal returns over the long term, some tactical moves can help you enhance the returns on your portfolio in the short run. Investment in debt mutual funds, for one, allows you to take a bet on the changes in interest rates and credit quality that can help you get some extra returns. What is a debt mutual fund? A debt mutual fund invests in fixed income securities. In India, the government is the largest issuer of these securities (due to its need to finance its expenses and investments), followed by banks (which issue fixed deposits) and corporates (which issue commercial paper). These funds also invest in securitised papers. The securities issued by a borrower can mature anywhere between 15 days to 30 years. A debt mutual ...

Swapnil Pawar and I wrote two articles in the India Infrastructure Review in 2004 while we were second-year students of the Post Graduate Diploma in Business Management (PGDBM) at Indian Institute of Management, Ahmedabad (IIM-A). You can read the articles here: Book (from page 270 of the printed book; page 298 of the pdf) A Faster Road on the Periphery of a City Sprawl Can Have Immense Value Swapnil Pawar and Akhilesh Tilotia Roads as Commercial Assets 270 • The Basic Model 270 • Changes Due to the Fast Road from Periphery 271 • Calculation of Value Addition 271 • Application to Real Life Case of a City 272 • Conclusions 272 Traffic Risk Management—Derivatives in the Transport Sector 273 Akhilesh Tilotia and Swapnil Pawar The Problem 273 • Alternative 1: Intra-private Players’ Risk 274 • Alternative 2: Financial Intermediary 274 • The Derivatives Market 275 • Expected Players and the Potential 276 • Issues 277