CAGRfunds – Blog

Gyaan Ki Baat 

The Power of Compounding: A Magical Force for Wealth Creation

Compounding is a magical force that can make your money grow exponentially over time. It’s a process where the interest earned on your initial investment (principal) is reinvested, allowing it to earn interest on itself.

Imagine you invest ₹1000 at a 10% annual interest rate. After one year, you’ll have ₹1100. In the second year, you’ll earn 10% interest on the entire ₹1100, not just the original ₹1000. This means you’ll have ₹1210. As you continue to earn interest on your growing balance, your money grows at an accelerating pace. This is the magic of compounding.

Time is your friend when it comes to compounding. The earlier you start investing, the more time your money has to grow. Even small amounts invested consistently over a long period can turn into a substantial sum. By understanding the power of compounding and taking advantage of its benefits, you can set yourself up for a financially secure future.

Here’s the list of curated readings for you this week:

Personal Finance

• UPS vs NPS vs OPS: Here are the key differences between the different pension schemes: After facing much criticism for removing the Old Pension Scheme, the NDA government has introduced the Unified Pension Scheme, which amalgamates the advantages of the previous Old Pension Scheme and the features of the New Pension Scheme. For more details about the newly launched scheme Read here

• New Rules From September: 5 Key Financial Deadlines That Will Impact You: As September approaches, several significant changes in personal finance are on the horizon. Take note of these 5 changes including the Aadhaar free update and credit card changes. Read here

• UPI Circle Delegate Payments launched: The NPCI has introduced a new feature called ‘UPI Circle’ on its Unified Payments Interface UPI platform. This feature allows primary UPI account holders to securely delegate payment responsibilities to trusted secondary users. Learn how to use UPI Circle, transaction limits, and other key features. Read here

Investing

• Regulator urges caution while investing in SMEs: India’s SME is under scrutiny as SEBI raises red flags over some companies’ questionable practices and unrealistic projections. Are you investing in SME companies? This article warns investors about the potential risks of investing in SMEs in India. Read here

• Federer’s Lessons for Value Investors: From the tennis court to the stock market, Roger Federer’s wisdom offers invaluable lessons for investors. Learn how his dedication, resilience, and adaptability can help you achieve financial success. Want to invest like a champion? Read here

• Which Indian mutual funds invest in Nvidia shares? Take a look at their exposure: Indian mutual funds hold significant positions in Nvidia, the artificial intelligence (AI) chip giant. This is notable given the recent rise and interest in the stock. Here’s a look at the exposure. Read here

Economy

• Moody’s raises India’s growth forecasts, Fitch affirms ‘BBB-‘ rating: Moody’s and Fitch have both expressed optimism about India’s economic growth. Moody’s raised its GDP growth projection to 7.2% due to improving rural demand and a strong recovery. Read further to learn what the two agencies think about the future of India’s economy. Read here

• ‘Time has come’ for US Federal Reserve to cut interest rates, says Powell: Federal Reserve Chair Jay Powell hinted at potential interest rate cuts in September, citing increased risks to the labour market. With the next Fed vote approaching, the stakes are high. Read on to see how these changes could impact your finances. Read here

• Heatwave Fuels Consumer Demand, But Challenges Persist: While some sectors soared, others faced headwinds. Consumer durables and retail thrived amidst a heatwave, while iron, steel, and cement struggled. Banks and real estate showed resilience. Will the monsoon and festive season bring a much-needed boost to the economy? Read Here

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Check out CAGRwealth smallcase portfolios

Both our smallcase portfolios are ranking well in the smallcase universe in terms of 1-year returns.

• CFF (launched in June 2022) – Ranked among Top 20 smallcase with medium volatility.

• CVM (launched in May 2022) – Ranked among Top 40 across the smallcase universe.

Do check it out here

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That’s it from our side. Have a great weekend ahead!

If you have any feedback that you would like to share, simply reply to this email.

The content of this newsletter is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information outlined in this newsletter unless mentioned explicitly. The writer may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated in this newsletter.

CAGR Insights is a weekly newsletter full of insights from around the world of web.

Chart Ki Baat

Regions that make up 50% of World GDP (Source: EpicMaps)

Gyaan Ki Baat 

Promoter holding is the percentage of a company’s shares owned by its founders. Promoters are usually the largest shareholders in a company and have a significant amount of control over its operations and decision-making.

A significant promoter stake often signifies a strong alignment of interests between the promoters and the shareholders. This alignment can foster a sense of stability and confidence among investors. A substantial promoter holding suggests that the promoters have faith in the company’s future and are committed to its success.

Investor in stock should therefore consider Promoter Holding as important parameter in decision making. However, it’s essential to consider other factors – If a significant portion of the promoter’s shares are pledged as collateral for loans, it could raise concerns about financial stability. Additionally, changes in promoter holdings, such as buying or selling shares, can signal their confidence or lack thereof in the company’s future.

Source: SEBI Official Website

Here’s the list of curated readings for you this week:

Personal Finance

• CBDT says tax clearance certificate not mandatory for all: Tired of hearing about new travel restrictions? Good news: most Indian travellers don’t need to worry about the income-tax clearance certificate (ITCC). The CBDT has released a report in which they’ve confirmed only those with serious financial issues need to apply. Read here

• UPI rules: How to get money back if paid a wrong UPI address. Here are RBI’s guidelines: The Reserve Bank of India (RBI) has released comprehensive guidelines addressing the scenario where Unified Payments Interface (UPI) users erroneously transfer funds to an unintended recipient.Read here

• All You Need to Know About Tax on Gifts in India: Giving and receiving gifts is an integral part of India’s cultural heritage. While in most cases, the value of such presents is nominal, but in some cases, the value of gifts can be substantial and subject to taxation. This blog will discuss various rules and regulations regarding how gifts are taxed in India. Read here

Investing

• What does India’s benchmark inclusion mean for investors: The inclusion of Indian government bonds in the JP Morgan Emerging Market Global Bond Index has attracted significant foreign investment in India. However, this article presents a balanced view of the implications of JP Morgan’s decision, highlighting both the potential benefits and risks for India and investors. Read here

• P2P lending cannot be sold as an investment product says RBI: The RBI has directed peer to peer (P2P) lending platforms not to promote their product as an investment product. To know more regarding the new regulations on P2P lending platforms Read here

• Regulatory Halt at GIFT City: Indian Authorities Tighten Controls on Family Office Investments: Indian regulators halted family office fund approvals in GIFT City due to tax evasion and capital control concerns, hindering its goal of becoming a key overseas investment hub. There are many more implications of this decision on India’s financial landscape and the future of GIFT City. Read here

Economy

• Where’s the money flowing? India’s passive MFs surpass Rs 10 lakh cr in AUM: The mutual fund industry in India has experienced a phenomenal surge in the past decade, with assets under management growing over seven times. To discover the key trends driving this growth and understand where the money is flowing. Read here

• India’s Inflation Eases: Inflation is a rise in prices affecting purchasing power. Recent data shows inflation easing, but it’s still important to manage finances effectively to combat its impact. For more detailed insights on how to beat inflation in 2024. Read here

• Railways to install AI-enabled CCTV cameras on locomotives, yards: Railway Board Chairperson announced CCTV cameras with AI on locomotives and key yards to reduce accidents. Learn how AI is transforming the rail industry in India. Read here

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Check out CAGRwealth smallcase portfolios

Both our smallcase portfolios are ranking well in the smallcase universe in terms of 1-year returns.

• CFF (launched in June 2022) – Ranked among Top 20 smallcase with medium volatility.

• CVM (launched in May 2022) – Ranked among Top 40 across the smallcase universe.

Do check it out here

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That’s it from our side. Have a great weekend ahead!

If you have any feedback that you would like to share, simply reply to this email.

The content of this newsletter is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information outlined in this newsletter unless mentioned explicitly. The writer may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated in this newsletter.

CAGR Insights is a weekly newsletter full of insights from around the world of web.

Chart Ki Baat

Source: Anker capital management

Gyaan Ki Baat 

Life actually is quite long in the grand scheme of things; we just don’t use our time wisely. When we dream, we often dream in years and forget about the decades. A year feels short yet a decade is a profound a period of time. You can do a lot in a decade. We overestimate what we can do in a year and underestimate what we can do in a decade.

Dream in decades. A year away can be forecasted, but a decade can’t. You can do anything you want in a decade if you work towards it. So, expand your horizons and think where you want to be in ten years. The possibilities are endless, then take the actions needed today to get one tiny step closer.

When you dream that far in the future, your ambition can grow in orders of magnitude. You don’t constrain yourself, because literally anything is possible in that time frame. We don’t zoom out enough. We are often laser-focused on what is in front of us and don’t take the time to look at things from broader perspective.

So, take time to think that far in the future. What person do you want to be? What do you want to be doing? It’s exhilarating to reflect upon. You can master skills, leave your mark on the world, and totally uproot your life. It’s thrilling.

Forget about the short term. Set yourself up for the long term.

Imagine the possibilities and always keep them in mind. Today may feel like slog or you may not have done what you wanted so far this year. Incrementally improve. Zoom out. You can do anything as long as you keep the decades in mind. Keep dreaming.

Author: Tyler Bruno

Here’s the list of curated readings for you this week:

Personal Finance

• A Few Little Ideas And Short Stories: Success depends on substance over style. Quality products, genuine focus, and deep understanding of customers are essential. Avoid hype and short-term thinking. Learn from history’s lessons: the value of hard work, the dangers of unchecked optimism, and the importance of long-term perspective. True success often lies in overlooked areas, requiring resilience and patience. Read here

• Share buyback tax regime to change from October 1: What this means for you? There will be significant changes to India’s share buyback tax regime from October 1, 2024. The new rules will shift the tax burden from companies to shareholders, fundamentally altering the landscape for buyback strategies. Read here

• Should young earners repay loans first before they start investing? Is paying off debt or investing your money the smarter move? This is an age-old financial dilemma faced by young earners. An insightful piece that explores the financial challenges faced by young earners. Read here

Investing

• At the Money: The Right and Wrong Way to Approach Investing: Investing is not easy. How do you pick the correct asset class? Which sectors do you buy? How do you know which are the right stocks or bonds to own? Do you use leverage? Do you hedge? Do you time? What about private equity, hedge funds, venture capital? Read here

• Talk on Floats: Float is essentially customer money held by a company before it’s used. Companies with strong moats often generate large floats due to their market power. This float can be used to fund operations, invest in growth, or simply earn interest. Examples include Costco’s membership fees, bank deposits, and upfront payments in various industries. Read here

• MF investors rush into ‘hot sectors’, draw caution: Thematic and sector schemes have received more than half of the investor money into equity mutual funds in the past three months thanks to a slew of product launches. Read here

Economy

• ‘A major shift in consumer preferences towards larger homes’, says Anarock report: The average flat sizes in India’s top seven cities have surged by 32% over the past five years, with the National Capital Region (NCR) witnessing a significant 96% growth, the Anarock Group said in the latest report. Read here

• Fishing in a Very Large Pond: India’s burgeoning market cap is a reflection of its rapid economic growth. The country’s GDP is on a trajectory to surpass major economies, driving corporate earnings and market capitalization higher. While market cap to GDP ratios can be misleading, the overall trend suggests a vast investment opportunity.Read here

• CPI Inflation in July Declines To 3.54%, Lowest Since August 2019; IIP Grows 4.2% in June: Inflation in India’s consumer prices eased to a nearly five-year low of 3.54% in July, with food price rise moderating to 5.4% from a six-month high of 9.4% in June, thanks to base effects from last July when retail inflation stood at 7.4% and the food index was up 11.5%.Read here

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Check out CAGRwealth smallcase portfolios

Both our smallcase portfolios are ranking well in the smallcase universe in terms of 1-year returns.

• CFF (launched in June 2022) – Ranked among Top 20 smallcase with medium volatility.

• CVM (launched in May 2022) – Ranked among Top 40 across the smallcase universe.

Do check it out here

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That’s it from our side. Have a great weekend ahead!

If you have any feedback that you would like to share, simply reply to this email.

The content of this newsletter is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information outlined in this newsletter unless mentioned explicitly. The writer may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated in this newsletter.

CAGR Insights is a weekly newsletter full of insights from around the world of web.

Chart Ki Baat

Gyaan Ki Baat  

Sector Rotation

Sector Rotation involves shifting investment capital between different stock market sectors based on economic cycle stages. As the economy moves through expansion, peak, contraction, and trough, sectors perform differently. For instance, technology and consumer discretionary sectors often excel during expansion, while defensive sectors like utilities and healthcare tend to do better in downturns. Investors use this strategy to capitalize on these changes by reallocating funds from underperforming sectors to those expected to benefit from current conditions. This approach aims to enhance returns and manage risk by aligning investments with the prevailing economic environment.

Here’s the list of curated readings for you this week:

Personal Finance

• Relief for real estate under LTCG regime: Govt to allow taxpayers to avail either lower rate of 12.5 percent without indexation or higher 20 percent rate with indexation if property acquired prior to July 23, 2024. Read here
  
• Sustainability is the only path: Sustainability is important in various aspects of life, such as dieting, exercise, and investing. Temporary solutions often lead to failure, as they are not maintainable in the long run. Sustainable strategies are crucial for long-term success. Rather than chasing quick gains or trendy stocks, investors should focus on a disciplined approach that aligns with their goals and risk tolerance. Read here
  
• Why it’s Hard to Create the first Rs 1 CR? Let’s face it, saving a crore isn’t child’s play. This page spills the beans on why it’s tougher than it seems. It’s all about breaking bad spending habits and smart saving moves. Read here

Investing

• BoJ’s Uchida: We won’t hike rates when markets are unstable: Bank of Japan Deputy Governor Shinichi Uchida expressed his view on the bank’s interest rate outlook, exchange value and the current market volatility. Read here

• Bonds: 10-year Treasury yield dives to the lowest since December after weak jobs report: U.S. Treasury yields slid after a weaker-than-expected jobs report for last month added to fears that economic growth is slowing. The yield on the benchmark 10-year Treasury was last at 3.796%, down more than 17 basis points. Earlier, yields hit a low of 3.790%, the lowest level since December 2023. Read here
  
• Why bond yields matter for equities: Poor economic news and corporate performance caused a sharp decline in stock prices. Surprisingly, this led to a significant increase in bond prices (lower yields). Understanding the future relationship between stocks and bonds is crucial for investors. Read here
  
• FTSE Russell unlikely to include Indian bonds in index as concerns over ratings, taxation remain: Global index provider FTSE Russell is unlikely to include Indian bonds in its government bond index as concerns over India’s ratings and taxation remains, market experts close to the development said. Read here

• Post-FOMC Update: The Fed and the Market Shifts: Central banks shifted gears this week. Japan tightened monetary policy while the US Fed prioritized job growth. Recent weak job data raised recession fears but overall aligns with the Fed’s view of a cooling labor market. Read here

Economy

• Piyush Goyal asks leather sector to aim $50 billion in exports by 2030: Union Commerce and Industry Minister Piyush Goyal on August 8 asked the country’s leather and footwear industry to target $50 billion in exports by 2030. He also asked the industry to take advantage of various free trade agreements (FTAs) signed by India and focus on manufacturing world class products to tap global markets. Read Here
  
• RBI focuses on aligning CPI with target amid resilient domestic growth: The Monetary Policy Committee (MPC) decided by 4:2 majority to keep the repo rate unchanged at 6.5 percent, in line with expectations. The MPC also decided by a majority of 4 out of 6 members to remain focused on withdrawal of accommodation to ensure that inflation aligns with the 4 percent target, while supporting growth. Read here

• Govt. of India on track to reduce fiscal deficit: Fitch Fitch Ratings on Friday exuded confidence that the Government of India should be able to achieve its enhanced goal of reducing the fiscal deficit to 4.9% of GDP this year, and further below 4.5% of GDP next year, but noted that the post-election Budget did not provide much clarity on medium-term targets. Read here

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Check out CAGRwealth smallcase portfolios

Both our smallcase portfolios are ranking well in the smallcase universe in terms of 1-year returns.

• CFF (launched in June 2022) – Ranked among Top 20 smallcase with medium volatility.

• CVM (launched in May 2022) – Ranked among Top 40 across the smallcase universe.

Do check it out here

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That’s it from our side. Have a great weekend ahead!

If you have any feedback that you would like to share, simply reply to this email.

The content of this newsletter is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information outlined in this newsletter unless mentioned explicitly. The writer may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated in this newsletter.