Finatter

  Pandemic has changed the world in an unprecedented way. It has affected, disrupted, and changed our lives once for all. If the world as a whole gets shattered is the real estate spared?? Old Model of Real Estate : In earlier days real estate followed this five-staged value creation model from  1 Change in original usage of land from agriculture to residential or commercial 2 Physical structure put up from residential or commercial drives other new venture driving up the price of the land  3 Improvement in commercial value as the locality populates more due to facilities made available results in increasing the demand. 4 Periodic booms and busts  5 Impact of the economic development and Inflation When the utility of the land changes it results in a price rise so is when the commercial value increases or demand due to an increase in population.  The price rise of real estate is also catalyzed by the easy availability of credit due to repo rate cuts or economic development leading to a

  The Indian banking system has seen a tectonic shift with the introduction of digital payments. The RBI has stated that there has been a phenomenal increase in digital payments with a CAGR of 19% in value and 66% in volume for digital payments in India between 2014-2019, despite this exceptional growth 70-80% of transactions in India are still in cash this only shows the scope of further growth in this sector. Let us discuss how digital payments can generate profits despite their thin margins, direct government control of regulators on pricing with customers who prefer no cost for the services rendered with minimum customer loyalty. Digital payment Apps can create revenues from the following verticals 1 Bank: The watertight compartment between banking roles and payment apps has been blurred. Payment apps generate income by partnering with banks and cross-sell bank products to their existing customers like insurance, stock brokerage, etc on a revenue-sharing basis. 2 Wallets: As per th

  We believe that we are rational decision-makers but little do we realize that it is also influenced by our biases. The human brain quickly categorizes new information with the experiences of the past, Once grouped it responds to the same ways it does with other things in the category-leading to bias. finance unlike physical sciences it is affected by one's behavior and gives different results to different people according to their temperament be it wealth creation or financial debacles. To overcome financial debacles we should see things as they are without our biased lens. To let go of our biases we should constantly challenge our beliefs by engaging in debates and discussions who have a contrarian view( just to hear the other side) but confirm with the facts available. Here is the list of biases researchers have warned that we may fall for. Anchoring Bias: Over-reliant on the first piece of information. Availability Bias: Overestimate the importance of the information available

  The margin of safety (MOS) has been extrapolated from bonds to equity it can be defined as the " Difference between the price paid for an equity share and the least price available in the range of intrinsic value of the share ". The best MOS is available when there is blood on the street and good quality are sold in fear and panic  It is also noteworthy to mention that as inflation rise MOS will continue to rise. For MOS company should be large-cap and have a track record of more than 10 years, MOS may not help to not lose money but will help minimize risk.  Loses usually occur when stocks are bought at high prices when markets are optimistic at the turn of economic tide these companies may lose significant market share. So, money can be lost even in quality companies when bought at a high price. PS: This is an excerpt from  the book  " Ordinary Stocks Extra Ordinary Profits" by Anand Srinivasan

  For all gold enthusiasts here is the answer  Gold has a special place in Indian households and is blindly trusted by Indians and let's delve deeper into how gold has earned such a special place. let's weigh-in. Gold as investmen t vs currency vs insurance vs ornaments  Let's desegregate into different clubs which gold belongs to  Investment : Anything which puts money into your pocket can be called an investment just because you hoard gold nobody gives you a penny unlike stocks or bank deposits which earn dividends and interest for just hoarding it, so gold will only have capital appreciation without yearly yield making a bad investment. On the flip side, it has an added benefit of easy transfer of wealth unlike any other investment known to man with less or no paperwork. Currency : Gold is a perfect currency as its supply is constant, it is either present under the earth or above the earth and with no scope for manipulation.   Gold does not dissipate into the atmosphere

I wish I had known earlier  Timeless lessons of life are known to us much later and we do regret not knowing them earlier in life, knowing which might have altered the due course for the better. Here are some which have to be internalized to make our lives much better     Expectations : The perils of expecting have been discussed in great lengths by all wise men and instruct us to be mindful of the quality of our work, Work with love and care remembering that our happiness depends on it. Resolve to be mindful of the approach towards work and work as an offering to god, expecting no reward, seeking no favors, and avoiding no challenges. Power of compounding : Habits compound and make little difference in short periods but makes an enormous impact on years or decadal time frame be it how you perceive risk, taking good care of your health, building wealth, or even quieting your mind. As it is said success is repeating few good habits every day. Self-learning : Self-directed learning to