QUOTE OF THE WEEK:
"The consumers are always the weaker
parties in need of protection. Consumers need to be enabled to navigate the financial
markets to make choices beneficial to their needs" - Dr Deepali Pant Joshi,
Executive Director, RBI
YOUR FINANCE DEMYSTIFIED:
What is dematerialisation of securities?
As a share or debenture holder, it is
important for you to be aware of the procedures to manage your investment in securities
(the collective name for equity shares, debentures, bonds, mutual fund units etc.)
Managing your investment in securities is
simple and easy in electronic form (dematerialised form) and it has many advantages over
managing it in physical form (share / debenture certificates). Accordingly, this write-up
details dematerialisation of securities, its advantages and how to manage your investment
in demat mode.
Your investments in shares and debentures can be held in
electronic or dematerialised form in a depository. Depository is an entity which holds
securities (shares, debentures, bonds, government securities, mutual fund units etc.) of
investors in electronic form at the request of the investors... Read more
more about demat accounts
Are demat & trading account the same?
The demat account does not trade (buy or sell) for you at
the stock market. To invest in stocks you still need a trading account which will act as
an interface between your demat account and the stock market and allow you to buy and sell
Let's quickly examine the entire process to understand how
the entire transaction happens. Suppose you are interested in buying shares of a company
XYZ which are at Rs 50 a share. You determine that you want to buy around 100 shares of
XYZ, so you transfer Rs 5,000 from your savings account. Once this transfer happens, you
log into your trading account and using the money you just transferred, you buy 100 shares
of XYZ for Rs 50 which costs you Rs 5,000 and you pay Rs 25 extra as brokerage... Read more
Understanding the basics of demat account
DID YOU KNOW?
What is the clean price and dirty price while trading in
Bonds trade at clean price and dirty price in different
markets. Clean price is the price of the bonds which excludes accrued interest. The dirty
price includes clean price along with accrued interest.
In India, bonds trade at dirty price in the NSE (National
Stock Exchange) corporate segment. Dirty price is the price of a bond with accrued
interest. Thus, a bond trading in the NSE corporate segment has accrued interest included
in it. Accrued interest is the interest that has got accrued on a bond from last coupon
payment date. As a buyer of the bond, you are supposed to pay accrued interest to the
seller of bond.
TERM OF THE WEEK
A subsidy is the benefit given by the government to groups
or individuals usually in the form of a cash payment or tax reduction. The subsidy is
usually given to remove some type of burden and is often considered to be in the interest
of the public.
IN THE NEWS THIS WEEK
PFRDA lets investors switch scheme for better returns
MF investments in debt funds at 6.4mn in April-July: SEBI
FM launches IRDA's Insurance Repository System
IRDA tightens advertising rules for life insurers
FLAME (Financial Literacy Agenda for Mass Empowerment) is
an IIFL initiative to promote financial literacy amongst the masses in order to make them
an integral part of India’s spectacular growth story.
In an era of accelerating GDP and rising per capita growth,
financial literacy has become more critical than ever before such that we all reap the
tangible benefits of the nation’s economic prosperity. Financial inclusion has been
quite high on the governmental agenda, given its emphasis on widening the Banking &
Financial services network across the country. IIFL’s FLAME initiative stands
committed to complement this effort by helping common people gain financial growth and
security though better awareness and education on the variety of financial products while
avoiding the lure of and loss from unrealistic claims made by unscrupulous agents and
Our objective is to light a FLAME, as the name suggests,
which will set ablaze a chain of FLAMEs across the country. The new-found light of
knowledge will undoubtedly dispel the dark clouds of financial illiteracy and ensure the
bright sunshine of financial growth and prosperity.
This portal is but one of the various IIFL initiatives that
would be part of FLAME.