Two smart money-spinning strategies

By Kartik Jhaveri

Unconventional thinking is THE most powerful weapon in creating everlasting wealth. In other words, to become wealthy it is critical NOT to be satisfied. 

I am not saying that you must be dissatisfied with your life, so much so that you get stressed. Oh no! Instead, be ambitious. We take you through two smart investment startegies to help feed your monetary ambitions.

Strategy 1: Trade-offs
It's pretty simple. You replace one asset in favour of another,which has more potential to create wealth. For example, move your investment from a Fixed Deposit, to say, a Public Provident Fund. It's definitely a better treatment for your money. 

You could move your money from PPF to say a Monthly Income Plan (MIP) of a mutual fund. Then go from your MIP to a balanced fund, from a balanced to a diversified equity fund, and then from diversified equity to a sectoral equity fund. And so on and so forth.

Giving a better chance to your money, naturally, creates an opportunity to treat you with better returns. An extreme example would be to have all your money only in real estate or in equity shares. Even this is not wrong; it all depends on how much you want your wealth to multiply.

Even if you had all your money invested in direct equity shares (perceived to be very risky) is also fine given that you know how to manage your portfolio. If you need proof of this, talk to some seasoned investors, over 50 years of age, who are not 'traders' in the stock market.

They will probably tell you how they amassed 5,000 shares of say Reliance Industries or Infosys. They did not buy it like an FII, but over the years they got bonuses, rights and dividends etc, in the process.

Continued on page 2

Kartik Jhaveri, an expert at Financial Planning, is a Certified Financial Planner and a Chartered Wealth Manager. He may be reached at kartik.jhaveri@transcend-india.com.

Disclaimer:The contents of the above articles are the intellectual property and copyright of the author, Kartik Jhaveri. No part may be used or reproduced in any form or manner. If you choose to act upon the information contained in the above article it is at your own risk. This article is purely educative and you are strongly advised to consult an expert prior to taking any significant decision.