How to Exercise While Sitting at Your Computer

Sitting at the computer all day is not exactly good for the body. If you have to be at a desk all day long, doing some simple things can improve your posture and health.

Steps

1. Sit properly in a good chair designed for desk work. Your back should be straight, and your head should be looking directly into your monitor. If you have to look down or up, you need to adjust the height of either the screen or your chair. If you keep leaning forward, first get your eyesight checked. If your eyesight is fine use a loose belt or string to tie yourself to the chair. After a while your posture will improve and you'll no longer need this restraint.
2. Maintain an ergonomic body posture while typing. Keep your legs bent at the knees so that the knees are only slightly higher than your hips. Feet should be flat on the floor or on a step stool of some sort.
3. Stand up every half hour. Walk around a few steps, stretch your legs, and give your eyes a break from focusing on your computer screen. This will also help prevent blood clots from developing in your legs. Blood clots are very common among middle age people, who generally use the computer a lot.
4. Roll your head around your neck periodically, but avoid rolling your head all the way back. Do the motion slowly clockwise for 1-3 iterations and then repeat in the opposite direction.
5. Roll your wrists regularly (this will help prevent carpal tunnel syndrome if you spend a lot of time typing).
6. Recognize that people tend to hunch in front of the keyboard. To counter that, perform the following exercise: open your arms wide as if you are going to hug someone, rotate your wrists externally (thumbs going up and back) and pull your shoulders back. You will feel a stretch in the scapula area.
7. Contract your abdominal and gluteal muscles, hold them there for a few seconds, then release. Do this all day long while you are in your chair.
8. Stretch your arms, legs, neck and torso while sitting. This will help prevent you from feeling stiff.
9. Take advantage of the downtime created by rebooting or large file downloads to get up and try something more ambitious such as doing a few push-ups, sit-ups, and/or jumping jacks. Beware of your snickering co-workers though.
10. Acquire a hand gripper. They are cheap, small and light. When you have to read something either on the screen or on paper, you probably won't be using your hands very often so squeeze your gripper. It is an excellent forearm workout.
11. Acquire an elastic band (also cheap, small and light) and use it to do the actions mentioned in step 8 (i.e., when stretching your arms, do it by pulling apart the elastic band). You will not only stretch but it will also work the muscles slightly.
12. Take a few deep breaths. If possible, get some fresh air in your lungs.
13. Invest in a large size stability ball or stability ball style desk chair, and sit on it with back straight and abs firm. The actual stability ball is more effective, however the chair is a more viable option for use in an office environment. Sit, bounce or do basic toning exercises while watching TV or talking on the phone as well. Use the actual ball form in moderation when typing, as this is probably not the most supportive seating to prevent carpal tunnel and tendinitis.
14. While sitting, lift up your legs on the balls of your feet and set them down. Repeat these until your legs are comfortably tired. Then repeat it again about 10 minutes later. Do this whole routine for about an hour or so. This will exercise your calves.

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Find these useful insurance covers

The Rangma tribe in Nagaland celebrates Ngadah festival after the harvest in November-end every year. On the last day of the eight-day festival, they perform three rites to protect themselves from natural calamities.

Making peace with fire is the first ritual they perform, in the hope that it would secure them and their belongings from this mighty force. With the festival of lights round the corner, we have a lesson to learn from the Rangmas.

Even after being extra careful about handling crackers and diyas, we can never completely eliminate the risk of fire. This is where insurance covers help. Though there are no festival-specific insurance policies in India, some of these can bail you out from the risks that festivals entail.

Cost of Protection
The risks	Price (Rs)1
Fire	50
Burglary	150
Jewellery	1,000
Mobile equipment	1,000
Health insurance	1,300
Motor insurance	3% of vehicle value
1For every Rs 1 lakh of cover

The threat of indoor damage extends from the furniture and upholstery to the Hussain painting on your wall or the antique vase on the shelf. All of these can be covered under the householder's policy. This policy covers 10 different risks, including fire, burglary and breakdown of domestic appliances. You can get a cover worth Rs 100,000 for your property against fire at a cost of Rs 50.

Though fire hazard is high during this season, it is not the only threat. Risks such as burglary, damage and loss are heightened during this period. In order to mitigate these other risks, you can pick and choose from the various options available under a comprehensive householder's policy.

Experts say that you should insure your property against fire and burglary and the belongings you insure should include jewellery and mobile equipment like TV and camera. A household cover worth Rs 100,000 will have a premium of around Rs 2,210.

Risks like breakage of windowpanes and breakdown of electrical appliances are all comprehensively covered under this policy. Those who step out of their homes to celebrate with friends and extended family can opt for robbery cover for their homes at Rs 150 for every lakh of insured value.

Jewellery is at a lot of risk during the festive season, with revellers wearing it liberally while attending ceremonies and parties. But jewellery can be insured too. Says Rahul Aggarwal, director, Optima Risk Management Services, "A policyholder will be reimbursed the value of the jewellery if it is lost or damaged."

Cover is usually available at a premium of Rs 10 for jewellery worth Rs 1,000. The cover can be extended to electronic gadgets. Cameras and handycams that are busy recording the festivities can also be insured.

Comprehensive motor insurance takes care of damages to your vehicle. If your car catches fire due to a rocket fired by your neighbour, the repairing expenses can be covered through a cashless form of motor insurance. On an average, insurance charges will be 3 per cent or Rs 9,000 for a car valued at Rs 300,000.

Then, there is the possibility that you might hurt yourself. You can get a health cover, which will take care of all your hospitalisation expenses for Rs 1,300 per Rs 100,000 of cover.

Whether the risks against which you are buying cover are serious enough to justify the cost of the policy is a subjective question. However, there is no denying the fact that the covers act as a protective shield against risks which you could be exposing yourself to amidst the festivities.

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Identify your financial goals after reading this

For individuals, the first step in their financial planning exercise is to set their goals/objectives. By setting your goals you know exactly what you want and can accordingly redouble your efforts to realise your objectives.

For individuals, making investments has different purposes. For some it may be simply for saving money as and when required for future needs, while for others it may be towards a specific goal/objective.

An individual's life is full of events. While some events are unpredictable such as accident or sickness, many of them are basic, yet important life stage events like child's education, marriage, planning to buy a property, retirement planning.

A common link between both predictable and unpredictable events is that it can put tremendous strain on your finances, so if you are well prepared for the same, it may not be as burdensome.

This is where the importance of setting goals/objectives becomes palpable. When you make aimless investments without any objective you may face some difficulties:

1. You have saved some money, but you do not have a specific objective in mind. If need be, you can employ it for something as critical as buying a house/property. At the same time you have no qualms about buying a car with that money or even going for a vacation. Coincidentally, finances for your child's education are also expected to be met from that investment, ditto your daughter's marriage. So you have a half a dozen needs and just one fund. This is a perfect recipe for a financial disaster.

2. Expectedly, you are not aware when and for what purpose you will require money in an emergency. However, you could have at least planned for a contingency fund/reserve, but didn't. In such a scenario when you meet with an emergency situation, you find yourself in a lurch since you have nothing to fall back upon. If you have set aside another fund for a critical objective like child's education, you may be tempted to dip into that fund to handle the emergency, which is a regressive step as far as your child's future is concerned.

3. If you do not have funds when you need them (like in an emergency) you may be tempted to take a loan (increase your liabilities) or ask a favour from your friend (which can be an embarrassment if it happens often). Either ways, this is not the best way to counter a financial emergency and can impact your finances significantly.

The above-mentioned problems can be countered through a straightforward solution -- identify your objectives well in advance. This has some strong indisputable benefits:

1. When you set objectives upfront, you know the purpose of the money as also the timing (when you will require the money).

2. Your facing a financial crunch is highly unlikely as you are aware about the quantum of money required for an event that is planned for well in advance, and thus you have made your investments accordingly. Even if it's an emergency, you are well prepared for it through a contingency fund.

3. Once your planning is in place, you are self-sufficient and are in no need to ask favours from any source.

Since your financial planning exercise is heavily dependent on your ability to set clear objectives, it should be very comprehensive, and should make provision for predictable as well as unpredictable events.

While there are several important objectives an individual must plan for, we have taken one that is critical for most parents -- child's education. The cost of education in today's age can be prohibitive. However, if you have planned for it, the cost may not prove all that burdensome. Let's see how this can be made possible.

Assume that at present an MBA programme of 2 years in a leading business school costs Rs 500,000. The age of your child is 5 years today and he/she will pursue the course at the age of 20 years. The time available to plan for your child's education is 15 years. Assuming that the cost of an MBA degree appreciates at 10% per annum, the degree after 15 years would cost Rs 2,088,624. Now this seems to be a bit too much, doesn't it? But not when you plan for it.

Planning for the future

Amount you wish to accumulate (Rs)	2,088,624
Tenure (years)	15
Assumed return (CAGR)	12%
Amount to be invested annually (Rs)	56,026
Amount to be invested monthly (Rs)	4,430

(Returns are indicative in nature)

If you have your objectives and investment plans in place, this amount may not be that difficult to achieve. Now that you are aware of the amount required for your child's education, the next step is to make the investments to achieve that target. Let us assume that over a 15-year period, you make investments in well-managed diversified equity funds which yield a cumulative return of 12% CAGR (compounded annualised growth rate). This would entail investing around Rs 4,430 per month. Suddenly the Rs 20 lakh (Rs 2 million) education fees do not appear so daunting.

Imagine, what would be the consequence if you have not planned for this astronomical sum in advance. Paying for your child's education at that stage would prove to be a mammoth task for you.

The above strategy of planning well in advance holds good for other objectives as well such as buying a property or your child's marriage among others.

The key to successful investing lies in regularly setting tangible, realistic goals and working towards achieving them. Individuals should have multiple portfolios, each of them catering to a earmarked objective. While setting objectives could be an easy task, the challenge is to get the right asset allocation.

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Create wealth in this successful way

If someone were to ask me what is the best investment to do, my perpetual answer is and always will be, 'Invest in You'. That's right, you are your greatest asset and you are responsible for everything you do whether you create or destroy wealth.

The number of people who create wealth is much lower to people who destroy wealth. That is to say that amongst us there are more individuals who are more wealth destroyers than creators. There are 3 reasons for that:

• Majority of the people don't understand 'risk' and the inherent wealth creation within a calculated risk, hence they let their money stay in banks and bonds.
• The ones who understand the real concept of 'risk' start on the right track but often do not succeed because they simply lack the conviction in their own self.
• Most people have a fear, the fear of failure i.e. to say that people are not risk averse but loss averse. To explain further, if one could have a certainty of returns from a risky investment, one would have no problems to deploy money in that investment.

But in all the above situations, wealth is not created and this is more due to lack of knowledge and this lack of knowledge has its roots in investing in yourself, that's as simple as it is.

So what does 'Investing in you' mean? It means trusting your own conviction. Here is a diagram that will help you understand better.

How do you understand the correct concept of risk?

Risk means volatility and volatility is inherent to risky investments. You would be more worried if your capital fluctuates but you would not be so perturbed if your profits fluctuate. Having said this, you must first allow for profits to get created, which require time and patience. Then if profits fluctuate it is better than your capital fluctuating.

Risk of capital erosion diminishes as profits build up with time. Capital will fluctuate in the beginning but over time, say a couple of years then it's only the profit. You can still take home 14 per cent to 16 per cent average returns each year totally tax-free. Now tell me where is the risk here?

Gaining more conviction, how?

It is very important to come to your own conclusion. To give you an example if you did analysis of say some FMCG (fast moving consumer goods) company and came to the conclusion that this company has a great strategy and will continue to grow at 15 per cent for the next decade - in my view that is the safest, brilliant and a highly rewarding investment avenue that you have discovered.

So then why fear putting more than 50 per cent of your money? But this comes out of knowledge and research, which comes by investing in your own self, that is, investing in learning and building investment skills.

What is the greatest fear?

Not trusting your own self. Your greatest enemy is you, yourself and not the stock market. Don't sell when you see a good investment is down by 20 or 30 per cent. Don't be timid and act in panic.

Understand it is momentary and not perpetual. Taking the same example above, if you see prices down it's time to buy and not to fear and eject out of the investment. If you want more proof just rewind to May of 2006, the stock markets fell by 30 per cent or so and by now, much of that fall has been retraced. If you sold our earlier, you are probably still waiting to re-enter. Having fear is understandable but irrational behaviour happens due to lack of knowledge.

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Art of investing and living

What is common between the art of living and the art of investing? Well, both require concentration and self-control and both give happiness, spiritual and material, respectively.

Or should we describe these two arts as bhaktiyog and karmayog, both delivering satisfaction of some kind. And this could be the description of Amruth Rao, vice president, CanBank Mutual Fund.

Rao, who has been in the mutual fund sector since 1992, manages the short-term debt schemes of CanBank Mutual Fund, viz. Canliquid and CanFloating Rate, and is an ardent follower of the Vedic principles as taught in the Art of Living of Sri Sri Ravi Shankar.

Canliquid has delivered returns of 6.49 per cent over the past one year and CanFloating Rate scheme has clocked returns of 6.77 per cent, being the second-best and the best returns respectively as per Value Research, in the categories of short-term debt and floating rate schemes.

The average returns in the above categories have been 6.26 per cent (institutional segment) and 6.13 per cent, respectively.

In short-term debt schemes, the main task is to manage liquidity and give good returns. Rao says, "The success of this task depends upon various factors. Our rapport with the corporates plays a significant role, along with our view on short-term interest rates. Deciding the duration of the paper that we buy is also important."

He adds that events like the budget or the credit policy and issues like advance tax payments, which depend upon the corporate performances, are other factors that determine the investing approach that is adopted.

"The liquidity position is the single most important factor in managing short-term debt funds. This in turn is based on the inflows and outflows from our schemes. At times, unforeseen circumstances lead to sudden withdrawals by corporates. Apart from that, daily monitoring of interest rates is crucial. It is your view on the rates that determines success or failure. The Mibor (Mumbai Inter-bank offered rate) has increased from 6.10 to 6.85, which indicates tightness in liquidity," observes Rao.

He proudly displays the best scheme in the category award received by Canliquid in 2004 and 2005 from Icra (leading credit rating agency). Canliquid and CanFloating Rate schemes, launched in January 2002 and February 2005, are the flagship schemes of the fund house in the debt category.
At present they have a corpus of about Rs 1400 crore (Rs 14 billion) and Rs 750 crore (Rs 7.5 billion), respectively.

Investments into short-term debt schemes, where the average maturity is less than one year, come irrespective of the conditions in equity markets or the long-term interest rate trends, according to Rao.

The cash surpluses of corporates continue to find their way into such schemes. It is the medium to long-term debt schemes and gilt schemes, which are affected by a rising interest rate scenario. "These schemes will under-perform if rates keep rising, especially if they have a higher modified duration," adds Rao.

Earlier, the Fed increased rates and Indian interest rates followed suit. Rao points out, "Last time, Fed has not increased their rates and going forward there is an indication of a stable or falling Fed rates. But in India, interest rates are likely to move northward in the short-term in light of the liquidity situation. Thus, at present flows into debt schemes are primarily coming to short-term/liquid or floating rate schemes. Going forward, fund managers will wait for the credit policy."

Out of the top 10 mutual funds worldwide, eight are bank-sponsored. Rao sees the brand of Canara Bank and its wide network, as the major plus points for his fund house.

He also expects further consolidation in the mutual fund sector. "Growth is also expected from the potential that exists in the semi-urban and rural areas. We have 22 branches across India and we concentrate on good performance, good service and investor education," says an optimistic Rao.

"A person should have a basket of investments depending upon his liquidity needs, his expectations from the markets and his timing. One good aspect about liquid and floating rate schemes is that they give returns of over 6 per cent per annum even in a single day, better than bank deposits. Internationally, the mutual fund industry is bigger than bank deposits," adds Rao, giving his scoop on investment philosophy.

Citing the example of a 30-year old salaried person, he feels that after investing in public provident fund and insurance, the rest of the investible surplus should ideally be invested in various kinds of mutual funds, with 50-55 per cent in equity schemes, 25 per cent in balanced schemes and the rest in debt schemes.

A science graduate, along with a law degree, Rao has also cleared CAIIB exams and done a correspondence management program from Newport University. Before heading the short-term debt portfolio, he was managing the balanced scheme - CanPremium - for 7-8 years from 1992. Prior to that he was working with Canara Bank.

At times, his playground shifts from the debt markets to the billiards table and during this spare time Rao also likes to swim. He was the football captain in college and also played table tennis and was into athletics.

Apart from spending time with his family, Rao is also involved with the Art of Living programs of Sri Sri Ravi Shankar in Borivli in Mumbai. Beyond his art of investing, his art of living also includes 30 minutes per day of Sudarshan Kriya or Pranayam (which is the science of breath control as described to novices).

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Easily buy a bunglow in Malaysia

Malaysia Tourism's inward investment promotion scheme -- 'Malaysia - my second home' -- is gaining momentum among Indian investors.

The programme, which was launched in 2004 in India, for attracting Indian investors to own bungalows and private resorts in Malaysia's tourism zones, has witnessed a substantial jump in 2006.

So far 490 Indians have bought bungalows and private resorts in Malaysia for about Rs 200 crore (Rs 2 billion).

The Malaysia tourism board, however, expects the number of investors to go up to 1000 by 2007. Most Indians, who have bought bungalows, are below the age group of 50 years.

Under the programme, the properties on offer in Malaysia vary from apartments and condominiums, terrace houses, bungalows in tourism zones such as beaches, near jungles and theme parks, recreational places and city centres.

The criteria to stay is a social visit pass with a multiple entry visa initially valid for a period of ten years and then renewable.

"Malaysia's stable economy, low cost of living, warm and balmy weather and political stability works in its favour. Also, Malaysia is an education destination with international schools and universities," said Manoharan, director, Malaysia Tourism.

Though initially, the 'Malaysia-my second home' campaign received lukewarm response from Indian investors, he added, "The scheme picked up steam only in later half of 2005 when the government relaxed investment rules and it became easy for people to invest money," said Manoharan.

At present, Indians below 50 years of age, who wanted to invest in Malaysian properties, are required to open a fixed deposit account of Rs 37 lakh.  After a period of one year, the participant can draw up to Rs 29 lakh.

However, Indians aged above 50 years, the rule is relaxed to a fixed deposit of only Rs 18 lakh with a local bank for a minimum period of one year.

As per the Malaysian tourism scheme, each participant is allowed to purchase two units of residential properties at a minimum price of Rs 18 lakh each depending on the location of the property.

However, participants are not allowed to own a business and work in Malaysia under this programme.

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Invest in these stocks after Diwali

The markets seemed to have post-Diwali blues on October 23! The first day after the start of Samvat 2063, and the markets traveled down and ended lower in the grip of profit booking. The Sensex closed at 12,623.28 down 113.54 points and the Nifty was down 12.5 points to close at 3558.5.

So where should one book profits or make fresh investments now? Experts give their picks.

Sajiv Dhawan of JV Capital Services believes after Q2 results, the whole midcap tech space is getting re-rated. His picks there include Aptech, which had a good run-up. He maintains a hold and even suggests a 'buy' on dips on it. Polaris too, still looks attractive to him at the current level, after its Q2 results.

"You are not going to see these stocks run away as fast considering they had good run-up over the last one-two months. So get into stocks selectively on dips or have at least three-six months timeframe. Then you can even start nibbling at a couple of stocks I mentioned even at current prices," he suggests.  

Giving his views on IFCI, he says, "From Rs 17 down to Rs 10, there is always a 'buy' on it. But I have very rarely seen investors make consistent profit on it," he says. So Dhawan says that he would preferably stay away from this stock because it has not given investors any real joy over the last few years.

Dhawan has a neutral stand on HP and BP currently and is initiating some buys maybe around Rs 305 - 310. He is not overly bullish on this sector for short term because, according to him, it is difficult to predict with volatile oil prices. But he does believe the results will be very good this quarter. "But it is a very difficult sector to play for the medium or longer term. So, this is a sector I prefer to stay away from," he says.

Discussing Tech Mahindra, he says, 'If you are looking for a substantial price appreciation in the short term, then from that perspective, you can get out of a Tech Mahindra and get into one of the other midcap Tech stocks, which are likely to give you better returns."

"But if you are very happy with the performance of your company and are patient, then by all means, hold on to the stock. I can see higher levels, which means at least a Rs 1000 plus, maybe not immediately, but definitely in three-six months time," he adds. So for a low-risk investor, who likes quality stocks, Tech Mahindra is definitely a hold.

Rajesh Agarwal of CD Equisearch too gives his picks. In the sugar space, he likes Triveni and Balrampur, along with Bajaj Hindustan, which, according to him, is a very good company for the long-term investor.

In the midcap IT space, he recommends Prithvi and Tulip IT. 'For Prithvi, I been pushing since Rs 300 levels,' he says.

In the metal pack, Tata Steel looks good to him. But he tries to explain, if the Corus deal goes through, the debt will be very high in the books, and servicing that debt will be quite a problem. "That is the only concern otherwise it is going to be very good in the long-term, Tata Steel is a good buy," he says.

In the midcap metal sector, he likes JSW Steel, which has given very good numbers. 'It has a very small capital base and can give excellent returns in the longer-term with capacity expansion,' he says.

Though the textile sector hasn't performed, Agarwal believes there are some very good picks like Nahar Spinning and Alok Textile there for the long-term. In fact, Nahar Spinning is better of the lot, according to him.

In the auto space, he finds Bajaj Auto looking good because of the kind of investments they have in their book and their products, which have been taken well by the markets. "In the short-term, they have seen a lot of correction because of the 100 CC bike. But going forward, I think Bajaj Auto would be a better bet than Hero Honda and TVS," he says.

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All about Systematic Investment Plans

SIP is a method of investing a fixed sum, regularly, in a mutual fund. It is very similar to regular saving schemes like a recurring deposit.

An SIP allows you to buy units on a given date each month, so that you can implement an investment / saving plan for yourself. Once you have decided on the amount you want to invest every month and the mutual fund scheme in which you want to invest, you can either give post-dated cheques or ECS instruction, and the investment will be made regularly. SIPs generally start at minimum amounts of Rs 1,000 per month and the upper limit for using an ECS is Rs 25000 per instruction. Therefore, if you wish to invest Rs 100,000 per month, you may need to do it on 4 different dates.

As is customary, I started with describing the concept of an SIP.

Let us break some myths on SIP now.

Investment in equity mutual funds or unit linked insurance should always be done in SIP mode: I remember in 1999 when Templeton Mutual fund would talk about SIP � the market looked at it skeptically. And it took a lot of convincing for customers to accept it. Now, life has come a full circle. Everybody wants to (always) invest using an SIP. If you have the maturity and calmness to realize that equities are for the long term and are willing to give your funds about 10 years, and you have a lump sum, you can afford to give the SIP route a pass. However, if your horizon is less than five years, you must do an SIP.

I do rupee cost averaging in a single equity � that is a kind of SIP is it not? This is a question I face every day. No, a rupee cost averaging in a single scrip cannot be equated to an SIP. When the market brings down the price of a single scrip, it is giving you information. You need to react to that.

Let us take two examples - Lupin Laboratories - has moved from a high of Rs 700 to Rs 100 and back to Rs 700. The question to ask here is not whether an SIP would have worked. The question to ask is whether you would have had the stomach to continue the SIP through this period.

Silverline Technologies moved from Rs 30 to Rs 1300 to Rs 7! In this case, if you had started an SIP at a price of Rs 1300, today you would be licking your wounds. SIP works in a portfolio, not in a single scrip.

You cannot invest a lump sum in the same account in which you are doing an SIP:  Many people assume that if they are doing an SIP in a particular fund, and suddenly they have a surplus, they cannot put that lump sum in that account. Fact is, in case you are doing an SIP of Rs 10,000 per month in an equity fund, and suddenly you have a surplus of Rs 100,000 and clearly you have a 10-year view on the same, then you can just push it into your SIP account. SIP is just a payment mode, not a scheme!

If I miss investing for a particular month, will they prosecute me? Now, this is the fear of EMI that people have. In an SIP you are buying an investment every month (or quarter), there is no question of prosecuting you for missing one investment. As a matter of discipline, you should not miss any month; however, missing one month's investment is not a crime!

When you have a surplus (accumulation stage of your life) you should do an SIP and during retirement you should do a SWP: No. You should ideally keep your withdrawals only from an income fund or a bank fixed deposit. You should sell an equity fund on some other basis, say deciding to sell 20 per cent of your portfolio in a year so that the return is 4 times the 30 year historic return. SWP, by definition cannot work in an equity fund! (Also read - 7 good reasons to invest in SIPs

SIP works for everybody, but does not work for me: Another myth. SIP works in a well-diversified equity fund in the long run. When people put forth arguments that it does not work for them, they have either not chosen a good fund or are looking at a 12 month horizon.

SIP is only for small investors: Nothing can be farther from the truth. I have a client who has invested Rs 32.66 lakhs using SIP, starting from January 1998 till date. Obviously, he has invested much more in later years as his income went up and the funds together are worth Rs 97 lakhs (Rs 9.7 million), substantially higher than his provident fund.

Market is at very high level to start an SIP: I have heard this when the index was 3000 also. I have no clue where the market is headed, but I know SIP works!

All fund houses are now charging a full load on the SIP, so now SIP will not work Why not time the market? Introducing an entry load was expected to happen and it has happened. What actually hurts the retail investor is the asset management charges � 2.5% in most cases is a bigger threat to compounding!

If I do an SIP in a tax plan, can I withdraw all the money on completion of 3 years? Another regular question almost! Every installment has to be with the fund house for 3 years. The lock-in comes from the Income tax rules, which say that a tax saving scheme should have a 3-year lock-in. You cannot escape that by doing an SIP!

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RBI Governor Reddy on the share market

In its April monetary policy, Reserve Bank of India Governor Y V Reddy surprised the market by not hiking the interest rates. Two months later, in June, he raised its policy rates hours after the European Central Bank hiked its key rate by a quarter percentage point to a three-year high of 2.75 per cent.

The central banks in Thailand, Korea, Turkey and South Africa also hiked their key rates around the same time, while the Bank of Canada and the Reserve Bank of Australia raised their key rates between late April and early May.

The RBI move, once again, surprised and shocked the market since there was no apparent reason for such a hike with the inflation rate being well within the RBI target. In fact, there were instances earlier when there were concerns on the domestic front but the Indian central bank refrained from any rate hike.

For instance, in August 2003, WPI inflation shot up to 8.7 per cent. Despite this, the RBI preferred to wait till its mid-year review of the monetary policy in October to hike the reverse repo rate - the rate at which the RBI sucks out excess liquidity from the financial system - by a quarter percentage point to 4.75 per cent.

By that time, the inflation rate had dropped to about 7 per cent. In September 2005 too, when the government hiked oil prices, the RBI did not act and waited till its mid-year review of the monetary policy in October to raise the reverse repo rate by a quarter percentage point to 5.25 per cent. It showed no urgency to combat the rising inflationary expectations in the aftermath of the oil price hike.

These instances point to a critical shift in the RBI's monetary policy stance: In its scheme of things, the external developments now have a larger say than the events on the domestic turf.

In fact, while announcing the April monetary policy, Reddy had said: "In a situation of generalised tightening of monetary policy, India cannot afford to stay out of step. It is necessary, therefore, to [not only] keep in view the dominance of domestic factors as in the past, but [also] to assign more weight to global factors than before, while formulating the policy stance."

If he sticks to this stance, one can expect maintenance of status quo when the central bank announces its mid-year review of the monetary policy next week.

This is because the US policy rate has peaked and some of the members of the Federal Open Market Committee, the policy-making body of the US Federal Reserve, have started talking about reduction in rates to pep up the economy, which has been showing signs of a slowdown.

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ONGC topples RIL from top slot in market cap

State-run energy giant ONGC has toppled corporate behemoth Reliance Industries from the top position in terms of market capitalisation after a more than one per cent dip in RIL's share price.

Reliance Industries' fell to the second position in the 30-share BSE Sensex, as its shares plunged 1.6 per cent at the close of the trading on Thursday, taking its market capitalisation to Rs 1.63 lakh crore.

RIL's shares were impacted by the news of a fire at one of its facilities at the Jamnagar refinery on Wednesday.

ONGC's shares ended in the green with a gain of 0.43 per cent that helped push its market cap to Rs 1.64 lakh crore.

IT major Infosys, which replaced PSU power major NTPC as the country's third largest corporate entity recently, maintained its position with a market capitalisation of over Rs 1.15 lakh crore.

Infosys' shares gained 1.46 per cent today to settle at Rs 2072.42 on the BSE today.

Another IT major, TCS was also seen trading with a modest gain and a market cap of over Rs 1.05 lakh crore, placing it at fourth position among India's listed entities.

PSU major NTPC, now the fifth largest in terms of market-capitalisation, was trading with a gain of about 1.5 per cent. Its market cap stood at about Rs 1.04 lakh crore.

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DCB, Global Vectra list on BSE

Development Credit Bank (DCB) and Global Vectra Helicorp Ltd on Friday got listed on the Bombay Stock Exchange at Rs 35.35 and Rs 175 respectively.
Shares of DCB got listed at Rs 35.35 with a premium of 36 per cent over its issue price of Rs 26 and the scrips of Global Vectra Helicorp were listed at Rs 175 with a discount of 5.40 per cent over its issue price of Rs 185.
Development Credit Bank (DCB) had fixed a price of Rs 26 per share for its initial public offer of 715 lakh equity shares amounting to Rs 186 crore.
The issue, opened for subscription on September 29 and closed on October 6 and was over-subscribed 35.68 times. The qualified institutional buyers' portion was over-subscribed 38 times, High net worth individual portion by 84 times and the retail portion 15 times.
The Global Vectra Helicorp entered the capital market with its Initial Public Offer of 35 lakh equity share of Rs 10 each at a price band of Rs 175 and Rs 200.
The issue was oversubscribed 3.59 times and constituted 25 per cent of the fully diluted post issue equity capital. In the retail category more than 13 lakh applications were received while QIBs applied for more than one crore shares.
The company, which is a part of UK-based $400 million Vectra group, is planning to add 15 choppers to its fleet in the next three years.

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Can Shanghai take on BSE now?

Till Thursday, China’s chief attraction to the outside world lay in its manufacturing sector which drew hordes of foreign investment. But its capital market — with its low trading volumes and hardly any foreign investment — was no match to the roaring stock exchange in India.
But a day later, things have changed. Friday’s listing of Industrial and Commercial Bank of China (ICBC) — which pulled off the world’s largest initial public offering (IPO) — promises to turn Shanghai into a strong competitor for Bombay Stock Exchange.
The IPO attracted $21.9 billion in Hong Kong and Shanghai markets. Though a major part of the offers were made in Hong Kong, Shanghai’s share exceeded a impressive $5 billion. Immediately on listing, ICBC’s share gave a huge boost to Shanghai’s market capitalisation and accounted for 20% of its index.
The boost that Shanghai recieved is not without official design. This is the first time that a major Chinese company has gone for simultaneous listing in Hong Kong and Shanghai, indicating the official desire to allow Shanghai get a piece of the action along with the Hong Kong market.
The simultanous listing is a major “experiment” by the Chinese government that paid off, industry sources said. The move assumes significance due to the fact that a host of IPOs by major Chinese firms are expected to take place in the coming months.
Market sources said the listing of ICBC would help the Shanghai exchange emerge stronger and attract larger foreign investment in the coming months. This will also help increase foreign investment in equities from the present level of $8.25 billion to $20 billion.
Although foreign investors played a minor role in Shanghai with ICBC IPO, they are expected to move in in a big way in the secondary market.
The Chinese government recently completed a major market reforms programme of converting a vast quantity of non-tradable shares into tradable equities. This reform helped expand and deepen the stock markets in Shanghai and Shenzhen by bringing about a fresh flow of new shares of state-run firms that had hitherto remained untradable.
Shanghai investors went into a frenzy booking orders for ICBC shares. The high level of demand led to expectations that the stock would post an impressive rise on its debut. But it rose a mere 5.1% in Shanghai, indicating that the market had accepted the official line of not allowing the share to get volatile.

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