The Lazy Investor

Equity Markets are volatile. They have been volatile in the past and they will remain volatile in the future. This means that that there would be days that markets are up and days when markets would be down. No one knows whether the markets would be down or up the next day. But it is much easier to predict the long term trends. No matter markets follow upward trend over long period of time. Warren Buffet , the richest guy in world and Investment guru who started investing at age of 11, says "It's impossible to lose money in Stock Market if your investment span is over long period of time" In my opinion common investors should do the following to create long term wealth for themselves. 1.) Invest in Equities through Mutual Funds . If you are not an expert then leave the job to one. There is no point in wasting your time and money on Tips, half bake knowledge 2.) Invest systematically into equity mutual funds through SIPs . 3.) Inv

Money market mutual fund is a low risk mutual fund. Investors can invest in money market for short run cash needs. Money market fund only invests in highly liquid cash and cash equivalent securities, which have high ratings. The primary purpose of a money market mutual fund is to provide investors a safe medium through which they can invest easily using smaller investment amounts. Money market funds invest primarily in debt-based securities having short term of maturity of less than 13 months and offer high liquidity with very low level of risk. Money market fund issues units/shares to investors at the time of purchase. It is mandatory to follow the instructions or the guidelines, which are drafted by the local regulator, like the Security and Exchange Commission. Extra income can come in the form of interest received on the portfolio. Money market funds in Pakistan performance Year-19 so far. Convention Money Market Funds  (Annualized Return)

Let's simplify things here for a beginner who doesn’t have time to read through multiple books , nor has the capacity to make sense of of those.  I would suggest some basic rules that will help you become better at investing right away  and make some easy suggestions to evolve from there. Let's start: Know how NOT to lose money : Most investors fall at this level. Knowing the difference between investing and gambling is the first step. Here is a golden rule. Take a look at the benchmark risk free govt bond of your country. Banks will offer about 1% more than that in term deposits (relatively risk free). So anything with a “guaranteed return” of more than that number is a lie.  In any major economy of the world, anyone who promises more than 10% guaranteed return is very simply… “ a Fraud”. There is nothing called a “good” risk free return : We all love risk free returns. However the closest to risk free return(well almost) is the govt bonds of that country. Anything ab

No, it’s not too late. And you’re still young enough to take advantage of compounding. This strategy that has probably made more people rich than all other strategies combined. Here’s how it works… you invest a sum of money that generates a steady return. But instead of taking that return and spending it, you reinvest it by buying more of the original investment. The next year both the original investment and the reinvested interest will earn interest, which you again reinvest. With compounding, your original investment is growing in size due to repeated reinvestment, and every year you are getting a larger and larger sum of interest. It’s like a snowball rolling downhill, growing bigger in size as it picks up more snow on the way. Let’s say an investor puts 10,000 in a deposit paying 5% interest annually. At the end of the first year, he is paid 500 interest. But instead of taking this interest out of his account, the investor reinvests the 500 on the same terms. At th

It is never too early to start saving, no matter what anyone tells you. There is a general perception that saving is something only an older age group needs to do. However, this is not true. Saving money is one of the best ways to ensure long term as well as short term financial stability and the earlier you start, the better it is. Young professionals especially must plan financially and take into consideration that life will throw curve balls. Here are five reasons why you should start saving in your 20’s: Takes Care of Your Expenditures:  Tired of hearing your parents tell you that you’re wasting their hard earned money on a vacation, the new iPhone or a car? Earning your own money but lose track of how it is exhausted in a flurry of eating out, shopping trips and weekend plans? This is exactly why you need to save and invest. Doing so will allow you to take care of all your miscellaneous expenses without you getting an earful from the folks or your conscience. Disciplines Yo