-- Posted Monday, 26 April 2010 | Digg This Article
| | Source: GoldSeek.com
GENERAL MARKET CONDITIONS/FUNDAMENTAL FACTOR
The other day I received a call from someone working in a technology outsourcing company in Gurgaon. The person’s age is around twenty four years and he wanted me to suggest investment avenues so that his money could double in five years time for his marriage and at the same time that investment qualifies for Indian income tax rebate. The person so far has only invested in Unit linked Insurance policies (ULIP). His annual investment is expected to be around Rs.1lac. The first question which I asked him was whether he has taken a pure life endowment policy and a cashless medical insurance cover which cover all forms of diseases. His answer was no. In view insurance policies need to be taken at the earliest possible age as possible. One should always take a basic pure life endowment insurance cover as well as medical insurance cover and later think of other forms of investment. In the number of people taking life insurance cover is on the rise but the number of people taking a medical insurance cover is very less. My advice is take a medical insurance cover at the earliest. In my view Indian youths should follow the following order while investment.
1) Take a pure life insurance cover and a medical insurance cover and also ensure that premiums are paid on time year after year.
2) Invest in mutual funds with a balance between equities and debt so that principle is intact. There are a lot of equity sector based mutual funds which over the years have given returns equal to government bonds. Gold exchange traded funds are also a good investment.
3) If further you have funds then start investing in stock markets directly for the long term (2-3 years time).
4) One should also ensure that he/she buys at least ten grams of physical gold every year.
5) Unit linked insurance plan (ULIP), public provident funds, bank fixed deposit etc.
6) Last is investing in equity futures and commodity futures. But these are very high risk investment.
The above is just a way to invest for a youth who does not have much knowledge of financial market conditions. There are other ways of investing which will vary from individual to individual based on his risk appetite. For a five period years my advice is to invest in sector specific equity mutual fund. One can also invest in systematic investment plan (SIP). (Please note that I am not an insurance advisor).
About the markets
Economic numbers from US and other regions across the world point to the upside. This will result in higher risk appetite of investors and overall continued rise in commodities and equity markets. There will be position squaring and rebuilding as the month comes to a close and a new month begins next week. The US housing sector seems for a big revival but it is mainly due to tax benefits on new home sales. Once the tax benefit on new home sales is over there will be a fall in US new home sales.
Technically all commodities are bullish and have room for another five percent gains this week if the upward momentum continues. If and only if global stock markets crash then only commodities will fall else sharp dips should be used as an opportunity to invest for the short term.
COMEX TECHNICAL VIEW
COMEX GOLD JUNE
Bullish over $1147 with $1176 and $1196 as price target
Bearish below $1136 with $1130 and $1116 as price target
Neutral Zone between $1147 and $1136
Gold targets $1176 and $1196 this week as long it trades over $1147. Intra day fresh wave of selling will be there only on a consolidated fall below $1157. We prefer to buy around $1157 stop loss below $1151.
Disclaimer: Any opinions as to the commentary, market information, and future direction of prices of specific currencies, metals and commodities reflect the views of the individual analyst, In no event shall Insignia Consultants or its employees have any liability for any losses incurred in connection with any decision made, action or inaction taken by any party in reliance upon the information provided in this material; or in any delays, inaccuracies, errors in, or omissions of Information. Nothing in this article is, or should be construed as, investment advice. Prepared By Chintan Karnani. Website www.insigniaconsultants.in
PLEASE NOTE: HOLDS MEANS HOLDS ON DAILY CLOSING BASIS
PLEASE USE APPROPRIATE STOP LOSSES ON INTRA DAY TRADES TO LIMIT LOSSES.
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-- Posted Monday, 26 April 2010 | Digg This Article | Source: GoldSeek.com
