Here we are. April 1, 2021. A brand new financial year. And what’s happening?
First, those who call them selves long term investors but keep track of prices like a hawk, will qualify under a new disease – “tickermania“.
In fact, your health insurance includes it as one of the diseases for which you can claim treatment expenses.
The treatment is quite simple to begin with. There is a new software in town. You have to subscribe, enter your PAN and it will then track your portfolio views.
It will allow 12 free views of your portfolio in one year.
For any extra views, you have to pay 1% of your portfolio value as a ‘view fee’, each time.
The cost of the software can be reimbursed by the insurance company. The extra fee has to be borne by you.
Apparently, hundreds of thousands of investors have been diagnosed with ‘tickermania‘. It is also understood that the market regulator will soon make it mandatory for every investor to take an annual test.
Remember, if you have tickermania for more than 3 years, your entire portfolio will be confiscated and put in the “investors protection fund”, where it will rot for ages.
Passive investors can rejoice now. For long, investors have suffered at the hands of companies with large pools of capital that exist solely for transfer of money from your pocket to theirs.
The investors can finally come together to form a co-operative and get a mutual fund license to launch and run low cost, market index based passive schemes.
They can keep the expenses minimal and redistribute profits to the members.
Co-operative banks, right?
In a related development, all mutual fund schemes that fail to deliver higher returns than the benchmark for 3 consecutive years, will be converted into passive, low cost, index funds.
Also, rolling returns will now be the default method of displaying performance for all schemes.
The market regulator changed the riskometer methodology hoping investors will use it to make better decisions. Based on the new calculation, some schemes went from moderately risk to very high risk.
The regulator didn’t realise that the investors were blind to the word ‘risk’ and they are see the meter as a speedometer.
For investors, the schemes just went from a low/moderate return scheme to a high return scheme. Well done!
Franklin Templeton shut down 6 schemes in April 2020. They earned a lot of bad press for it.
As a way to calm investors, it has decided to give back all the fees it has charged investors in the last 2 years, from those schemes.
From an investment, where I felt like a fool and the money down the drain, it has taken a complete U turn.
<wake up from dream alert>
Several individuals, used the VPF route as a safe haven to earn a risk free, guaranteed rate of return and add to their retirement kitty.
Starting April 1, 2021, VPF or Voluntary Provident Fund will now be called an Involuntary Provident Fund or IPF.
You ask why? See, starting financial year 2020-21, any interest on contributions made in excess of Rs. 2.5 lakhs to the EPF, will be taxed at your regular tax rate.
Such a dampener!
I see this as a part of the grand scheme to push more money into the casinos.
Sensex and Nifty did a roundtable and have announced that will continue to go up and continue to be volatile.
However, they plan to give a jolly good ride that will terrify you in parts!
Year 2020 has been declared as the “year of easy money“.
It gave rise to a new crop of Option Traders, NFT sellers and Bitcoiners.
They made stinking money (perfumed, sorry).
Hey, even value investors could finally prove their existence!
What? You didn’t make money?
“Band karo market!”
In another development, the SIPpers have been declared “person of the year”.
They are often called fools.
But if not for them, stock markets would have been “shut” and end of the world near.
Here’s a toast to their positivity and for keeping the “fat fee earning companies and tax gorging government alive”!
“Fools rush in where angels fear to tread!”
“A fool and his money are soon parted.”
Happy Fool’s Day!
“Don’t look too good nor too wise.”
Disclaimer: You read this post at your own risk. Nothing may be truth and everything may be. Use your discretion.
You are right!
Investors have been befooled by the government.
Even senior citizens who have invested heavily in traditional instruments like PPF are feeling duped, with the interest rate brought down abysmally.
It’s another matter that because of political compulsions, government restored the rates to the last quarter of 2020-21.