compile error in hidden module 1 of ITR2 while opening excel 2007

ust install " msxml 6.0 service pack1 " for all type of compile errors In ITR excel you can download this utility from the link below

Read more at: http://www.caclubindia.com/Forum/details.asp?mod_id=237865

ust install " msxml 6.0 service pack1 " for all type of compile errors In ITR excel you can download this utility from the link below

Read more at: http://www.caclubindia.com/Forum/details.asp?mod_id=237865

ust install " msxml 6.0 service pack1 " for all type of compile errors In ITR excel you can download this utility from the link below

Read more at: http://www.caclubindia.com/Forum/details.asp?mod_id=237865

If you have any kind  of compile error then just install this utility which is an xml parser
(ITR2 uses macros and xml hence you get this error)
http://www.microsoft.com/en-in/download/details.aspx?id=6276

If problem still persist try the solutions mentioned on below forum
http://www.caclubindia.com/Forum/details.asp?mod_id=237865

ust install " msxml 6.0 service pack1 " for all type of compile errors In ITR excel you can download this utility from the link below

Read more at: http://www.caclubindia.com/Forum/details.asp?mod_id=237865

Aviva Life Insurance LifeSaver Plus Review

One Mr. Shah a neighbour of mine showed me his policy taken from Aviva Life Insurance Lifesaver plus with Balanced Fund = 100%. He was purchasing a flat and wanted to surrender and see how much will he get back. He had paid 4 installment of Rs. 50,000 totalling to Rs. 2,00,000.

The details of the policy are as follows.

Base plan = 2,50,000
Policy Term = 20 years
Annual Installment = 50,000
policy start date = November 2009
Balanced Fund = 100%

CHARGES:
1. policy admin charges : Rs. 660 First year (Rs 52 per month )
2. Fund Management charges : 1.25% per annum for balanced fund
3. Premium Allocation charge : (White collar Robbery)
      a) Rs 20,000 First year (40% of first year premium)
      b) Rs 15,000 second year (30% of 2nd year premium)
      c) Rs   2,500 third year (5% on third year premium)
      d) Rs  1,000 fourth year onwards (2% on fourth year premium)
4. Mortality charges as per age mortality column


ACTUAL WORKING
1st year :
Amount invested : 50,000
Total charges : 22,327
Actual Investment : 27,680
Fund value: 30,552  ( Even at 10% return it will only be around 30,552)

2nd year
Amount Invested : 50,000
Total charges : 17,968
Acutal investment : 32,032
Fund value : 68,988

3rd year
Amount Invested : 50,000
Total charges : 6,326
Actual investment : 43,674
Fund value : 1,24120

4th year
Amount Invested : 50,000
Total charges : 5,774
Actual Investment : 44,226
Fund value : 1,85,423

So even after 4 years of investing Rs 2 lakhs you will end up with a fund value of Rs. 1,85,423

Now if you want to surrender this policy you will get back only Rs 1,39,423 because you have to pay there surrender charges which is 25% of the fund value after 4 years.

Had he invested in PPF or even simple Fixed Deposit he would have got 2 lakh plus as ppf gives more then 8%, he would have easily got more then 2,43,330 Approx  (Balanced mutual fund or debt fund would have also given more then this because they have total charges cap of 2.5%)

He has been robbed of  Rs 1,03,907 (2,43,330 - 1,39,423)

Who is responsible for this day light robbery ?
1. IRDA (regulator who regulates such policy)
2. Company ( who design this products )
3. Agent  (who mis-sold the policy)
4. customer (who did not read the policy before buying)

The interesting part about this is the initial document has all this charges written in black and white in fine print.

All I can say is BE AWARE of such legalised fraud

Historical Returns of Gold, Equity and Debt

Reference : SBI Mutual Insights May-2013, page - 16

Bonus declared in UTI ULIP, UTI Childrens Career plan, UTI Retirement Benefit Pension Plan

UTI Mutual Fund has announced declaration of bonus units under
1. UTI Unit Linked Insurance Plan,
2. UTI Children's Career (Balanced Plan) and
3. UTI Retirement Benefit Pension Fund.

Investors will receive 1 unit for every 10 units held.

The record date is May 30, 2013

Role of RBI, Repo and Reverse Repo rate, Bank rate

RBI acts as a banker to the government participating in open market operations, maintaining price stability and ensure adequate flow of credit to productive sectors.

Open Market operations (OMO)
RBI sells or buys government securities in open market transaction depending upon whether it wants to increase liquidity or reduce it.

Reserve Requirements (CRR and SLR)
CRR or cash reserve ratio refers to a portion of deposits which banks have to keep with the RBI. This serves two purposes. It ensures that a portion of bank deposits is totally risk free and secondly it enables RBI to control liquidity in the system and thereby inflation. To control inflation RBI increases CRR and on other hand if it wants growth then RBI reduces it.

SLR is Statutory Liquidity Ration refers to the amount that all banks requires maintaining in cash, gold or approved securities with RBI. This helps RBI to control liquidity in the market.

Repo Rate
It is the interest rate which RBI charges to banks for collateralized short term loan.

Reverse Repo Rate
Reverse Repo is the rate which RBI pays to banks. When banks have surplus liquidity and there are not enough borrowings from banks by consumers banks park money with RBI and earn some interest called reverse repo rate.

Bank Rate
It is the interest rate at which banks, FIs and other approved entities in the interbank market can get financial accommodation from RBI.

Reference
www.rbi.org.in/home.aspx

what is Debt ? what is Bond ?

Debt Instruments are contracts in which one party lends money to another on pre determined terms with regards 1) Interest rate, 2) periodicity of interest and 3) tenure of debt after which principal is repayed.

Few common examples of Debt Instruments are Fixed Deposit, NSC, PPF, Bond, Debentures etc

'Bond' is the term used for debt instruments issued by government and 'Debentures' is the term used for instruments issued by corporates or private sector.

There are bonds which are listed on stock exchanges after issuance and are traded regularly on marked to market basis. Trading platform for government securities are NDM - 'Negotiated Dealing System' and WDM- 'Wholesale Debt Market' also called NEAT(National Exchange for Automated Trading) on BSE and NSE.



Terms used in Bonds

Principal : Principal is the actual amount lent or invested or Face value of the bond.

Maturity : Maturity is the length of time until principal amount of bond must be repaid.

Coupon : Is the amount of Interest paid per year expressed as a percentage of the face value of the bond. It is mostly paid semi annually (It is called coupon as intially each bond used to have coupons attached to the bonds and holders receive the interest by stripping off the coupons and redeming them)



Different kinds of bonds

Coupon Bond : Debt obligation of semiannual interest payments generally called bearer bond or vanilla bond

Zero Coupon Bond: This bonds do not pay interest but are issued at deep discount to the face value. this are also known as deep discount bonds

Floating Rate Bond : Bond with variable interest rate is called floating rate bond. The adjustments are tied to certain money market instruments and are set every six months.

Callable Bond : Bond that can be redeemed by the issuer prior to its maturity.

Putable Bond : Bond holder can force the issuer to repurchase the bond before maturity.

Convertible Bond : Bond which can be converted to companys equity at predetermined date at the discretion of the bond holder.

Amortizing Bond: A class of debt in which a portion of principal amount is paid along with periodic interest.



DEBT INVESTMENTS THUMB RULE :
Price of Bond is inversely proportional to the interest rate.

Lets look at an example. A 10 year GOI (Government of India) bond offering 7% fixed coupon has been auctioned today with face value of Rs. 100. We assume we bought it on issue and this bond gets listed on exchanges at Rs. 100. Aftere 3 months due to monetary measures taken by RBI the interest rate in market falles by one percentage to 6%.

As the bond is marked to market and traded. it has to be valued every day. so market price post interest rate cut will go up as the bond carries a higher coupon rate then prevailing market interest rate. However if the interest rate would move upward the same bond would be traded at discount price. therefore we follow the first thumb rule of interest rate and current price of a bond move in opposite direction.

Now the question is how much % price of a bond change due to changes in interest rate. in above case 1% rate cut in interest rate will affect all future cash flows to be received from this bond to the remaining tenor. We can then say that all future coupons will be re-invested at a lower interest rate and resulting in fall in YTM on the day of valuation.

Asset Allocation for overall balanced portfolio

Ideally, Retail Investor should invest as per ASSET ALLOCATION.

30% Debt  ( PPF - 30%, Long term MF Debt fund -30%, Tax free
Bonds -10%, Bank FDs -10%, Traditional LIC - 10%, short term liquid fund -10% )

30% Real Estate (1st own home, 2nd Home for Rental Income, 3rd Commercial property & 4th
Land or plot)

30% Equity (Large cap MF -30%, ELSS - 30%, Midcap/Smallcap - 30%,  Direct large cap shares -10%)

10% Alternative investments (Gold ETF -30%, Silver -30%, Daimonds - 30%,Antiques paintings etc-10%)


Above Asset allocation is only for reference and one can change or modify it according to his/her situation.