Back to Basics - Must know Concepts!

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Back2Bas ics Must Know Concepts

Transcript of Back to Basics - Must know Concepts!

Page 1: Back to Basics - Must know Concepts!

Back2BasicsMust Know Concepts

Page 2: Back to Basics - Must know Concepts!

Is SIP just like EMI ?

EMI Is paid for an asset you own on borrowed

funds. The sum total of all EMIs would be higher than the actual market value of asset

The asset for which EMI is paid depreciates during its life time

Interest is paid to a financer based on the outstanding loan

A default or delay to pay EMI leads to penal interest or recovery calls from financer

It is more of a Liability

SIP Is paid as a commitment to invest

regularly. The cumulative total of all SIPs broadly depends on market performance

The generated wealth at the end of the tenure* is a liquid asset

Returns are earned on the money invested every month

Even if you miss 1 or 2 instalments your investment stays intact and no penalty is levied

It is more of Asset creation

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Page 3: Back to Basics - Must know Concepts!

Why is SIP better than FD ?

FD interest rates are fixed for the entire period Interest earned from FD is Taxable income Lumpsum amount is held till maturity date Liquidating your FD before maturity date usually

attracts a penalty on the final amount

The possibility of returns are higher in the longer term Equity funds held for long term (more than 1 year) are

not taxable Small amounts are deposited at regular intervals Some schemes allow withdrawals at any given point

of time, without any exit load or extra charges

SIPFixed Deposits

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ELSS is open-ended Diversified Equity Mutual Fund which is qualified for tax exemption under section 80C of the Income Tax Act. The dividend earned from ELSS funds are Tax-free too.

A Lock-in Period of three years is applicable on equity-linked savings schemes, which is least of all tax saving instrument.

BENEFITS- Gives you Exposure To Equity & helps you grow your money

when the stock market grows over a period of time. It holds the potential to generate massive returns

Offers Diversification as the scheme invests in shares of companies across various sectors

Twin-advantage of capital appreciation & Tax saving

Equity Linked Savings Scheme

(ELSS)

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DisclaimerMotilal Oswal Securities Ltd. (MOSL) Member of NSE, BSE & MSEI

Motilal Oswal Securities Ltd. (MOSL) Member of NSE, BSE & MSEI - CIN no.: U65990MH1994PLC079418 Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; ; Tel No.: 022-3980 4263;

www.motilaloswal.com. Correspondence Address: Palm Spring Centre, 2nd Floor, Palm Court Complex, New Link Road, Malad (West), Mumbai- 400 064. Tel No: 022 3080 1000. Registration Nos.: NSE(Cash): INB231041238; NSE(F&O): INF231041238; NSE(CD):

INE231041238; BSE(Cash): INB011041257; BSE(F&O): INF011041257; BSE(CD); MSEI(Cash): INB261041231; MSEI(F&O): INF261041231; MSEI(CD): INE261041231; CDSL: IN-DP-16-2015; NSDL: IN-DP-NSDL-152-2000; Research Analyst: INH000000412. AMFI: ARN 17397. Motilal Oswal Asset Management Company Ltd. (MOAMC) : PMS (Registration No.: INP000000670); PMS & Mutual Funds are offered through MOAMC which is group company of MOSL. Motilal Oswal Wealth Management Ltd. (MOWML) : PMS (Registration

No.: INP000004409) is offered through MOWML which is a group company of MOSL. Motilal Oswal Securities Ltd is a distributor of Mutual Fund & IPOs. Please read the Risk Disclosure Document prescribed by the Stock Exchanges carefully before investing.

Investments in Securities are subject to market risk and there is no assurance or guarantee of the returns. Details of Compliancse Officer: Name: Neeraj Agarwal, Email ID: [email protected] , Contact No.:022-30801085 The securities/ scrip/ stock name quoted are exemplary and are not recommendatory. Motilal Oswal has been awarded as Best Broking House in Cash Segment & Institutional

Clients at the Dun & Bradstreet Equity Broking Awards 2015.*Account would open after all procedure relating to Client due diligence is completed