Sunday, 17 May 2015

Decoding Sensex - Do stock markets really help you make money?

Disclaimer: The post below is a result of personal work. The full version can be accessed at

The main purpose of the stock market is to make fools of as many men as possible.
Bernard Baruch

Indian stock markets have created a great interest among investors in India and world wide, yet again. While we aren't seeing the kind of euphoria that we saw in 2008, the interest is no less. Perhaps, the 2008 experience is still keeping a large number of retail investors at bay and thus, making it difficult for market makers to take the full advantage of the last 1 year's unprecedented bull rally. This rally definitely smells more sensible than the one we saw in 2005-2008 but the picture will only get clearer as we scroll further.

We all keep reading several articles and stories of how investing in stock markets has made people millionaires or billionaires. It appears such an easy thing to do. People keep saying how Rs 10000 invested in Infosys is worth some 2-3 crores today, how some x amount invested in mutual funds is 100x today and so on. All said, how certain can we be that the same will repeat over the next 10-15-20 years? To this, the market experts quote historical returns of stock markets and guide that this will be replicated in the future, although they add the disclaimer that past performance are not indicators of future returns. So, how do laymen decide whether or not to invest in equities or equity underlying instruments? A million dollar question.

Following are some numbers that give you interesting insights on performance of the stock markets in India from January 1991. For the purpose of ease and convenience, I have used data for Sensex (monthly data). All percentages are in absolute terms (unless stated otherwise)

Monthly performance
  • On a closing basis, in March 1992 saw a return of 42%, highest ever. In October 2008, the Sensex fell 24%, again the highest month over month decline.
  • Would you believe that in October 2008 (intra month), the Sensex fell 42%? The month high was 13203 while the month low was 7697.
  • The Sensex nearly doubled between Feb and Mar 1992. Lets say you are successful in buying at month's low and able to sell in the next month at the month's high, the highest gain you could make is 97% (March 1992 saw a high of 4318 and February 1992 saw a low of 2193).
  • Can you believe that you would never lose money if you bought at any of the month's low as the Sensex has always gone higher in the next month. In other words, in all the months, at least on one occasion, the Sensex has always gone higher than the previous month's low in the subsequent month.
  • On the other hand, lets say you bought at month's high and sold next month at the month's low, the worst possible case is that you would lose 49% and the best possible case is that you could gain 2%. It is even more unbelievable that you would make a gain only in 4 out of 291 months. (2.1%, 1.1%, 0.3%, 0.2%). You'd end losing money in the remaining 287 months.

3 month performance
  • The sensex has posted a 124% in the 3 month period ending March 1992. It declined 38% in 3 month period ending November 2008.
  • Assuming you picked the index at the lows of December 1991, you could have made a gain of 139% by March 1992. On the other hand, if you had picked up at the highs of July 2008, you could have lost 49% by October 2008.

Continue reading on Linkedin Pulse


Sunday, 26 April 2015

Donating to #NepalEarthquake, PMNRF clauses, and other points

Update: Its clear now that the PMNRF will help Indian citizens who have been affected by the earthquake.

Like many, I have been wondering if the Prime Minister's National Relief Fund can offer help to Nepal, especially because of the 3rd clause in the T&Cs of the donation as copied below.
  1. Contributions from Government/budgetary support or from the balance sheets of PSUs  are not accepted in PMNRF.
  2. Conditional contributions, where the donor specifically mentions that the amount is meant for a particular purpose, are  not accepted in the Fund.
  3. PMNRF provides relief only to the citizens of India. Hence contributions wherein the donor mention that the amount is meant for the foreign citizens/calamities abroad, are  not accepted in the Fund.   
However, it is interesting to note that the NDRF (National Disaster Response Force) is working in Nepal and its source of funding is definitely Indian Government. Next, whatever help India is offering to Nepal also is funded by some source in India only. So, we can not be sure yet about how they account for these transactions and expenses. So, I'd just go ahead and donate to PMNRF and let them take a call on what they do. In any case, I can be certain that my donation will be used for a right cause.

So, where are people donating now? And where should you donate if you plan to?

This tweet by PM Modi doesn't clarify where the donation was sent.

Several companies are pledging funds to the PMNRF now. So, what I'd do is simply go ahead and donate to the PMNRF. The amount will definitely be of help, in some way. Moreover, I am sure that my donation gets used for a good cause. 

Just take that step now and donate. No second thoughts. Donate wherever to whomever whatever you can but take care to ensure your funds are going to a correct organization. 

Unfortunately, the world has vultures and scavengers who are ready to take advantages of adversities too. 

Personally, I wouldn't donate to any NGOs, especially considering the kind of outcomes we are seeing these days and also their dubious claims. If I, personally, would have to choose among NGOs only, the I would choose Sewa International, solely because I have seen their work.

Donate now, and #PrayforNepal

Here are some points taken from the PMNRF and PMO India websites for further reading.
  • The PMO has 2 funds, namely the PM National Relief Fund and the National Defence Fund. 
  • The resources of the PMNRF are utilized primarily to render immediate relief to families of those killed in natural calamities like floods, cyclones and earthquakes, etc. and to the victims of the major accidents and riots. Assistance from PMNRF is also rendered, to partially defray the expenses for medical treatment like heart surgeries, kidney transplantation, cancer treatment, etc.
  • The fund consists entirely of public contributions and does not get any budgetary support. The corpus of the fund is invested with banks in fixed deposits. Disbursements are made with the approval of the Prime Minister. 
  • PMNRF has not been constituted by the Parliament. The fund is recognized as a Trust under the Income Tax Act and the same is managed by Prime Minister or multiple delegates for national causes. 
  • PMNRF operates from the Prime Minister’s Office, South Block, New Delhi-110011 and does not pays any license fee. PMNRF is exempt under Income Tax Act, 1961 under Section 10 and 139 for return purposes. 
  • Prime Minister is the Chairman of PMNRF and is assisted by Officers/ Staff on honorary basis. 
  • Permanent Account Number of PMNRF is AACTP4637Q.

Now, some important questions and answers that PMNRF offers.

What criterions have been fixed for disbursal of funds held under PMNRF?
  • The disbursement out of the fund is made at the discretion of the Prime Minister, and in accordance with the Prime Minister’s directions.

Are contributions towards the PMNRF exempted from Income Tax?
  • Yes, all contributions towards the PMNRF are exempted from Income Tax under Section 80(G).

Who are eligible to receive money from the Prime Minister’s National Relief Fund?
  • The Prime Minister’s National Relief Fund (PMNRF) is primarily utilized to render immediate relief to families of those affected by natural calamities like floods, cyclones and earthquakes etc. and to victims of the major accidents and riots. In addition to this, the PMNRF provides financial assistance to indigent patients for treatment of major diseases at Government/PMNRF empanelled hospitals to partially defray the expenses.

Now, the next big question is, Can a National Relief Fund be used to offer help outside India? 

  • The straight answer could be NO. However, there could be situations where the PM may use his discretion but again, that should in some way help Indian citizens.

So, what will happen to the funds that are donated to PMNRF for the purpose of #NepalEarthquake relief?
  • They could be used to help Indians stranded in Nepal or those who have unfortunately lost their lives due to the earthquake. There has been one situation that I have sighted below. Thus, we should await details on this.

Details of relief measures funded out of the PMNRF for purposes such as accidents, terrorist activities and communal conflagrations in recent years are as follows:-
S.N. Purpose Relief Measure
6. Bus accident in Nepal on 15-07-2012. Ex-gratia of Rs. 1 lakh each to the next of kin of the deceased persons has been sanctioned. Rs. 37 lakh has been released for 37 death cases.

Friday, 27 March 2015

Breakfast with #KelloggsWaleGuptaji

Written exclusively for Kellogg's India

Verma: Hello Guptaji. Kaise ho

Gupta: Badiya Vermaji. Aap bolo. Bahut din se Golf course mein nahin dikhe?

Verma: Kya batayein Guptaji, health problems hain. Doctors se milne mein hi din nikal jaata hai

Gupta: Khaane pe control rakho, sab theek ho jaayega.

Verma: Ab aap ki tarah dieting toh hum nahi kar sakte. Rukha sukha khaana humse na ho paayega.

Gupta: Arey, main toh badiya aur swadisht khaana khaata hoon ji. Ek kaam karo, kal breakfast ke liye mere yaahaan aa jayo. Khud pata kar lo.

Verma: Theek hai, subah milte hain phir

Gupta: Jaroor. Jai Shri Krishna.

* * * 

Gupta: Sunti ho, kal Vermaji aa rahein hain nashte par. Achha sa kuch bana dena. Woh Kellog's ka kuch naya recipe mil gaya toh maja aa jaayega.

Mrs Gupta: Theek hai ji, dekhti hoon

Log on to

Mrs Gupta: Yeh kuch Tandoori Cheese Cornflakes aaya hai ji, naya wala.

Gupta: Tandoori Cheese? Badiya hai. Dekho na, kya karna hai, kaise karna hai.

Mrs Guptra: Yahaan pe poora list toh diya hai. 
  • 2 Cups crushed cornflakes
  • 2 Tbsp oregano
  • 1 Tbsp chilli flakes
  • ½ Tsp salt
  • ¼ Cup grated parmesan cheese
  • 1 Tbsp Tandoori Masala
  • 2 Tsp oil

Directions :
  • Combine all the ingredients in a plastic bag, Seal and shake.
  • Toss till evenly coated and serve

Gupta: Arey dekho, video bhi hai. Click karo.

Mrs Gupta: Arey wah, kitna aasan hai. Yehi karte hain.

* * *

Verma: Namaste Guptaji.

Gupta: Aayiye aayiye Vermaji, bade dinoan ke baad. Kaise ho bhabiji.

Mrs Verma: Acche hain. Aap kaise ho. Bacche kaise hain

Mrs Gupta: Sab Bhagwan ki krupa.

* * *

Verma: Guptaji, aapne to healthy breakfast ka daava kiya tha. Yahaan pe toh mukje Tandoori Cheese ki khushboo aa rahi hai.

Gupta: Haan Vermaji, yehi toh hai woh raaz. Kellogg's ne kayi saare naye recipes diye hain corn flakes banane ke. Isse aapko corn flakes khaane ka ehsaas bhi nahi rahega, aur taste ka taste bhi mil jaayega.

Verma: Accha. Yeh to badiya hai. Humko bhi batao isske baare mein.

Mrs Gupta: Bahut aasan hai. Bas Kellogg's pe website, ya facebook page, ya youtube page par jaayiye aur aapko saari jaankari mil jaayi. Sau se jyada recipes hain wahan pe.

Mrs Verma: Yeh aapne bahut achhi baat batayi. Kal se hum bhi shuru karte hai #KelloggsWaleGuptaji

Mrs Gupta: #KelloggsWaleVermaji

Verma, Gupta: Ha Ha Ha !!!

Times have changed and live too has changed. From a world where we had enough time to cook food and savor it, we have run into a world where we hardly have any time to eat food, forget preparing it. Further, the commercial world around us has been quick to catch up this mess by opening us restaurants at every corner of the street. The food consumption outside home has only been rising over the years. Its always a great practice to have food at home for several reasons. For those of us who are stretched for time, Kellogg's has come up with these brilliant options. Corn flakes have been turned into a tasty recipe and packaged in a different way altogether. Consuming ready food along with satisfaction to taste buds is a great advantage that this provides. Breakfast is perhaps the most important meal of the day. Let's begin the day with a Kellogg's meal.

Sunday, 22 March 2015

The small and simple aspects of happiness

Exclusively written for Coca-Cola International Day of Happiness

Happiness is perhaps the most hunted aspect of life. Everyone in the world wants to be happy, and wants their near and dear ones also to be happy. Happiness, for me, is to see the smile on faces of people around me. It makes me feel really wonderful when I can be the cause for that smile. Most time, however, it doesn’t become possible. A large number of things aren’t in our control and depend on several external factors.

If I were to list down all those things that make me happy, they appear to be very simplistic. However, I bet, these are the ones that are the most complex ones. Someone has rightly said, “It is more complex to make things simple”. Often, I am reminded of the story of the princess who had turned sad in her life. The king employed every method to make her happy. He got her a house, several friends, several pets, lot of jewellery and so on. When everything failed, he sent a word across the world that whoever makes her smile will win a reward. Many experts came in and tried their best to make her smile, which didn’t happen. Finally, one ordinary guy steps in with a big stomach and as he walks, his stomach falls apart, and ‘Phoolkumari’, the princess, bursts into laughter. It is such a small thing if you look at it this way that he had a pillow over his abdomen to appear bulky, and he makes it fall, as if to appear that his stomach has fallen apart. Yet, it was enough to get back the smile on the princess’ face. 

Many a times, it is these small things that bring us happiness, and the funny aspect of life is that these small things are difficult to find, especially considering the material progress the world is making. We hardly have access to chirping birds, peaceful atmosphere, greenery, devotional experiences, etc., that add those small bits of happiness to us. Our happiness is linked to buying best gadgets, which become out-dated in a few days; building relationships with best people, who change colours with time; seeking perfection, which never happens as there is always scope for improvement; and so on. So, each time, our aspirations get larger, and each time, it only becomes more difficult to attain happiness. While aspirations and dreams are must in life, we must learn to derive happiness from small things in life. There is happiness in everything around us, if we look it in the right way. We must learn to add value, instead of deriving value, and this is perhaps how I look at happiness. Our deeds brings us more happiness that our derivatives.

“Little deeds of kindness, little words of love, Make our earth an Eden like the heaven above.”

Sunday, 15 March 2015

A Memorable day #together

Written for

7th Feb 2015 is one of the most memorable days of my life. It was my father's birthday and I had been planning to celebrate this day in a great way. However, as I was running a busy week, I couldn't make any plans. Luckily, the birthday was on Saturday and it gave me some room to plan. I started planning in the morning.

I started thinking about what would be the key need to make this a beautiful day. Soon, I realized that it would be to bring the family together. So, I called my sister, who lives in Mysore, and asked her to come to Bangalore. I started browsing for restaurants in the vicinity and checking for availability. Finally, I decided to book a table at 'The 13th Floor' in MG Road. Though the place was far, I thought it will be a great experience for all of us.

It was a big surprise for my dad when he saw my sister reach home in the evening. We decided to head to the restaurant then. On the way, I started thinking about what I should gift him. On thinking, I realized that he had been long planning to buy a suit. I checked with a couple of outlets over the phone and decided to walk in to Raymonds. The decision was symbolic with the company's tag line, "The Complete Man". There is one category of people who desire that if they buy a suit, it should be a Raymonds; if they buy a car, it should be a BMW; if they buy a home, it should be a Shoba, and so on. I guess I belonged to that category when it came to this decision. However, personally, I never have such choices and pick up whatever makes best sense.

It took nearly two hours for us to zero in a suit for him. After all, it was akin to buying an asset which he would treasure for a lifetime. He was excited, and all dressed for dinner. We walked in to Ebony on the 13th floor, which was right next to the Raymonds store, and the breathtaking view of the city from our table added more beauty to the day. As we started our meal, we experienced the love, happiness and bliss of being together. We rejoiced a couple of past experiences, including the famous birthday memory we had 7-8 years ago. It so happened that all of us had forgotten my dad's birthday, including him, as he had met with an accident and was living in my grandpa's home, which was near to the hospital. My sister and I were watching the TV in the evening, and in the serial, there was this scene. Son forgets father's birthday, and mother comes back harshly on him and says, "What kind of a son are you?". Just then, I was like, "Gosh, it is my dad's birthday today". It was already dinner time, and we rushed to the bakery, picked up a cake and a couple of candles, drove to my grandpa's home and celebrated the day. Really unbelievable stuff even today!

Families are such an important part of our lives. They are the motivation to do all that we do.

Home wasn't a set house, or a single town on a map. It was wherever the people who loved you were, whenever you were together. Not a place, but a moment, and then another, building on each other like bricks to create a solid shelter that you take with you for your entire life, wherever you may go.
- Sarah Dessen