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Ramalingam K
“We provide sure-shot stock market investment tips. Enjoy the free trial for 6 months. If you are satisfied, you can enrol for the premium investment tips package anytime”

Have you received an Email or SMS similar to the above? Also have you wonder, how could anyone provide sure-shot tips? If they know a sure-shot investment tip, why do they reveal it, instead of investing and making money for themselves?
Let me reveal you today their trade secret. The secret behind the scam: “Sure-shot Investment Tips” and why you should not fall prey for this.

The Scamsters Strategy!!!

Scamsters, usually, pose as online stock market advisers. They somehow collect 1 lac contact details to start with. Once these scamsters have 100000 retail investors’ email id or phone number, their scam activities will start.

And how it works!!!

The modus operandi is simple. They give tips. Say in a particular month they will predict the market will go up or go down. Accordingly, their 100000 clients will react and invest according to the tips. It so happens that there is a 50:50 probability that the market will behave according to the tip. Either it will go down or go up. Hence these scamsters will inform half of their clients (say 50000 clients) that the market will go up and the remaining half (another 50000 clients) will be informed that the market will go down.

Developing satisfied clients!!!

As the market will either go up or down, one group of 50000 clients are going to be benefitted. The scamsters then will focus on the 50000 benefitted and satisfied clients and will give a tip for the next month. They will divide the remaining 50000 clients in two groups and to one group they will inform that the market is going up and to the remaining 25000 clients the market will go down. Again one group of 25000 clients will be benefitted from the tip.

Developing very satisfied clients!!!

The scamsters will then ignore the group who did not benefit but will now focus on the group 25000 clients who had benefitted. They will repeat the strategy by dividing them in two groups of 12500 each and give them two opposite tips for the next month. One group 12500 clients will be benefitted and the other 12500 will not. The scamsters will now focus on the benefitted group 12500.

They will further divide this group of 12500 satisfied clients in two groups of 6250 each and offer them two opposite tips. One group of 6250 will be further benefitted to which the scamsters will concentrate ignoring the other group.

Developing Devoted Clients!!!

They will again divide this group of very satisfied clients of 6250 in to two groups of 3125 each and repeat their strategy of giving two opposite tips for the next month. Again one group of 3125 will further benefit and become very satisfied clients.

The scamsters will divide these very satisfied 3125 clients in two groups and give them opposite tips. Out of the 3125 very satisfied clients, 1562 clients will be benefitted from this tip and will become devoted clients of the scamster.

Making Merry out of these Devoted Clients!!!

What has happened in this process is that there are now 1562 clients who have got 6 consecutive right tips from the scamsters and have made money in the process. They will be now greedier to earn more money. The scamsters are actually waiting for this opportunity. They will introduce the paid version of the so called “Sure-shot Investment Tips Package” to these 1562 devoted clients and sell the paid version to all of them for a lumpsum amount. These devoted clients will continue to stick with the scamster till they have lost considerable amount of money.

The scamsters will collect another 1 lac contacts and repeat the same scam again with the new contacts. Once their contact database is exhausted, they will create another investment tip website with a different brand name and start giving the trail package to the same database.

This is how the Sure-shot investment tips scams are devised and scamsters take advantage of the greed of the clients, who they have engineered to become devoted so that they can part with their money and these scamsters make hay!!!

Greediness and the desire to make quick money are actually the weakness on which these scams are built. Don’t fall prey for these traps. Remove those weaknesses and become stronger financially forever.

If you want to avoid these kind of financial and investment traps and be on the right financial tracks, then preparing an elaborate financial plan will be of great help. If you are serious about creating a financial plan for yourself, then you may want to check our financial planning process.

The author is Ramalingam K, an MBA (Finance) and Certified Financial Planner. He is the Founder and Director of Holistic Investment Planners ( a firm that offers Financial Planning and Wealth Management. He can be reached at

Ramalingam K
Ever seen a hurdle race? Noticed how the athlete concentrates on overcoming the hurdles? How they time their leap at the right moment to sail smoothly over them? For these people the barrier is just a physical obstacle and not a mental one. It is the mind which has to be geared to overcome barriers and this dictum holds true for investors too.

It is often that investors behave in a manner which is just the opposite of what they should be doing in the first place. Instead of concentrating on facts they are driven by rumors. They chase the elusive winning stock and trip on the hurdle, losing money as a result. These mental hurdles which the investors encounter can be overcome by identifying and eliminating them by following some simple rules.

Emotional Imbalance:

Emotion is a barrier which may look harmless and passive but it has the potential to wreck havoc and bruise the investor financially. ‘Buy low and sell high’ is a simple mantra which investors need to follow. They forget and instead often get afflicted by emotion, refusing to sell peaking stocks and ignoring potentially promising out-of-favor stocks. Holding on too long to losing stocks in the expectation that they will rise often never happens and financially the investor moves from a position of bad to worse.

Lack of Knowledge:

The reluctance to understand the working of the investment market can cost the investor dearly. Everyone wants to back a winner but sometimes this can be a malady; especially when such a winning streak is not sustainable. Investors tend to back a stock which is currently strong without examining the reasons for its rise. This will inevitably lead to the stock’s downfall.

Myopic View:

When the investor takes a myopic view, they lose the sight of the big picture. They may know that thinking long-term is the key to the success of their investment, yet they become drawn to the short-term movement of the stock and end up losing focus and money.

Killing the hurdles

Whatever the barrier or hurdle, it can be tackled and eliminated with a systematic and pragmatic approach.
Here are some useful steps which could turn investors to become agile and mentally fit hurdle runners:

I. Learn to monitor performances: ‘Those who forget their history are condemned to repeat it’. Learn from mistakes and keep a track of your performances. A rational approach would be to document the market and sector trend, the exit target and the trailing stop. This record is a useful manuscript for identifying barriers and getting around them.

II. Identify the weak behavioral patterns and rectify them: Introspection is the right action which the investors need to undertake in order to find out their own behavioral weaknesses. Specifically, examining the past investing pattern will help pin-point the successful as well as the unsuccessful endeavors.

III. Stay committed to the changes necessary: What is to be changed is perhaps easier to identify than making the actual change. Bringing about a change in one’s behavioral pattern needs unwavering focus. A half-hearted attempt will not yield the desired result hence a temporary break from the investment routine is advisable to regain focus.

IV. Gear up adequately to deal with losses: Coming to terms with losses is a point of maturity in the investor behavior index. How to cope with losses which are a part and parcel of the process of investment is something which the investor has to learn. Accepting the loss and moving on will augur well for the overall investment process.

V. Gather experience and expertise in one investing strategy: The data available on different investment strategies are overwhelming and can often become intimidating for the investor. Under such circumstances it is always better to avoid trying to become a ‘jack of all trades’, rather mastering one investment strategy is a useful policy to follow. It may result in the loss of some investment opportunities but will help the investor to gain confidence in the chosen process.

VI. Learn to weigh alternative possibilities: Assessing the market, learning the subtle nuances and taking action accordingly will lead to an enhancement of the risk-reward evaluation process. Making a learned judgment based on the probabilities and market behavior will yield positive results.

VII. Adopt an objective approach: Often investors feel that the market will behave in a manner that they expect it to behave, however more often than not, it is not so and the market behaves on its own terms. Investors will be best served if they stick to an objective approach.


A hurdle racer becomes a champion because he is disciplined and follows the successful strategies. An investor too can be a winner by training himself to form and follow the successful investment strategies.

The author is Ramalingam K, an MBA (Finance) and Certified Financial Planner. He is the Founder and Director of Holistic Investment Planners ( a firm that offers Financial Planning and Wealth Management. He can be reached at

Ramalingam K
It is said that money makes life simpler!! However, when it comes to manage that money people just run –away from it. As far as money management is considered, there are a few tasks like evaluating a stock that needs deep understanding and a specialised skill. There are few other simpler tasks, which everyone can do.

At the outset, they may appear harder. However, they are simpler if you understand the basics and you start practicing it.

It is our attitude at the beginning of a task which, more than anything else, will affect its successful outcome.

1) Budgeting:

“Every young man should have a hobby. Learning how to handle money is the best one.” Jack Hurley.

Budgeting, simply means being aware of where you are spending your money. If you want to learn about this concept then there are no. of books, blogs and tutorials dedicated to this topic. There are certain other websites also which freely guides you about every detail of budgeting. But take a minute to think, just apply your common sense. Do we need to refer a book or website for creating our own budget?

For creating a budget, you first need to have income and expenditure list in your hand. Add all those details in a simple excel file and see if the money going out is more than coming in. Once you learn to tally it, you can add things like setting financial goal etc.

To project the expenses for the future, you can take the clue from your past expenses. So you need to refer your old bank statements and credit card statements. Also don’t forget add the annual expenses like car insurance, property tax, festival expenses.

2) Taxes:

“The hardest thing in this world to understand in Income Tax” This is a wrong notion to have.

Most of us think, the tax planning and tax filing are complicated things and we need to have more knowledge to do so. Actually it is not so.

For a salaried person, tax planning is much easier. You need to pay close attention to your form 16 to understand more about where and how to save tax.

Now a days, you can file the income tax return online. The process is completely easier and user friendly.

3) Estate Planning:

Estate planning is nothing but planning about how your assets need to be shared between your legal heirs after your death.

• If you have not created a will so far, create one now. List down all the assets, movable, immovable, financial... Also decide which asset needs to be passed on to whom and mention that.

• Update all your investments and insurance plans with nominations and beneficiaries. You need to review this periodically.

• Make sure the nominees or beneficiaries registered in the investments and person to whom you want the proceeds to go after your death needs to be same. This will make the entire asset transmission process easier.

Estate planning will help your legal heirs to get the transmission happen not only faster and also makes sure the transmission happen without a conflict.

A best estate plan is the one which will not leave the heirs with conflict, confusion and cost.

There is no complication in doing these tasks. The complication is there only in our mind. So if we could remove that, these tasks will become simpler. In short, make use of these smart and handy tips to simplify seemingly complicated financial tasks.

The author is Ramalingam K, an MBA (Finance) and Certified Financial Planner. He is the Founder and Director of Holistic Investment Planners ( a firm that offers Financial Planning and Wealth Management. He can be reached at

Ramalingam K
A disciplined approach towards building an investment portfolio is in itself a very good investment for the investor.
Investors aim to achieve their financial goals through their investments and these goals vary widely across the investor community. There are different types of investors who belong to different age brackets, have contrasting disposable incomes, and have a plethora of different preferences for which they need money during their lifetime. These factors and motives decide the investment pattern and the portfolio which needs to be built.

Here are four small steps to build an effective investment portfolio which will help the investor achieve their dream run as far as investment yields are concerned:

I. Get the right Asset Allocation for your needs

Assessment of individual’s financial status, their investment goals are of prime importance for building a effective investment portfolio. Investor’s age decides the term period of the investment. A 21 year old, starting his career, will have a different investment goal focus than that of a person who is 55 years of age and is in the last leg of his service tenure. The degree of risk the investor is willing to take is also a key factor towards fixing the right investment portfolio.

The combination of current financial situation, investment goals and the risk taking propensity decide how the different investments would be divided among the asset classes. Higher returns are achievable by undertaking greater risks. This is referred to as risk/return trade off.

The 21 year old would obviously be in no great hurry to see his investment yield a return immediately and would thus be prepared to take greater risk in comparison to the 55 year old investor who would probably look at good risk-free returns which are also tax-efficient, after his retirement.

In this context it is relevant to discuss different portfolios which range from the conservative to the aggressive.

• An aggressive portfolio will consist of around 70 to 75 % of equities and the balance in bonds and fixed income securities.

• A moderately aggressive portfolio will be made up of 50 to 55 % in equities, Up to 40 % in bonds and fixed income securities and the rest in cash and equivalents.

• As compared to this a conservative portfolio would not stake more than 20 % in equities and the bulk of investments would be in fixed income securities.

II. Achieving the defined portfolio

Once the asset allocation has been fixed the amount has to be allocated appropriately into asset classes. However there are some sub-categorizations of the asset classes which the investor might want to get familiar with. The equities offer an opportunity for investment in different sectors, market caps, domestic and foreign equities in the same way as bonds which can be allocated between short term and long term, government versus corporate debt and so on.

The basket of investments consists of stocks, bonds, Mutual funds and Exchange-Traded Funds (EFTs). The investor can choose from these basic categories and their numerous variants available in the market which best suit their individual investment needs.

Before picking a stock and/or a bond it is imperative that their inherent traits are examined thoroughly. Short-listing potential picks and carrying out further study on them is always a good practice. Similar exercise needs to be carried out for Mutual Funds and ETFs’ also.

III. Reassessing the Portfolio Mix

Nothing in this world is permanently permanent and so it is with the portfolio of investments. Market movements, change in priorities, needs and current financial situations, guides the portfolio mix.

In order to carry out a well designed re-balancing exercise it is necessary to find out which portions or asset classes are overweight and which are underweight. Pruning the overweight ones and allocating them to the underweight class will set it right for the time.

IV. Rebalancing Strategically

While carrying out the rebalancing exercise as mentioned in step III, it is helpful to keep in mind certain things which have an effect on the investment portfolio.

A particular equity in the portfolio may be doing well, however as a part of the rebalancing exercise it may become necessary to sell the equity and this may attract substantial capital gains tax. In such a situation it would be better to carry out the rebalancing in a different manner, perhaps by contributing more in the non-equity components, thereby bringing down the ratio.

The investor needs to be well informed and conversant about the market interactions on a regular basis. Analysis and feedback from the market is essential to keep stability to the portfolio. In the above example it might be so that the equity market is expected to crash heavily and in such a case it is always advisable to sell inspite of the tax implications involved.

A well diversified portfolio is the key for a sustained and healthy long-term growth of the investments. An ideal portfolio is one which will stand the test of time and will be consistent in returns and solid in growth. The small steps recommended will result in your investments to leap.

The author is Ramalingam K, an MBA (Finance) and Certified Financial Planner. He is the Founder and Director of Holistic Investment Planners ( a firm that offers Financial Planning and Wealth Management. He can be reached at
Ramalingam K
The tax payers, auditors and tax masters go extremely busy filing taxes and working on refunds in July. 31st July is the cut off for filing your returns which is set by the central board of direct taxes. Not only tax filing process has become easier to do it online and also the filing has become mandatory on or before July 31st. This year, we have got the time extended up to Aug 5th.

Do I need to file my returns?

What are the criteria to file the returns?

Is it mandatory for all the taxpayers to file the returns in the same assessment year?

What happens if I miss to file the returns on or before July 31st?

If you have such questions in mind, go ahead and read it further.

Who needs to file the returns?

For those whose taxable income exceeds Rs.2 lakhs in a financial year by way of income from salary, house property, capital gains and income from other sources needs to file the returns on or before July 31st every year.

For income from business or profession the last date of filing return is September 30th every year.

Is the return filing process cumbersome?

Not at all. The CBDT(central board of direct taxes) has made the tax filing process easier than before. It is mandatory to file returns through online for those whose taxable income exceeds Rs.5 lacs in year.

First you need to register your PAN in the website. There are forms available like

  • ITR 1-> for income from salary and income from other source,

  • ITR 2-> income from house property and capital gains,

  • ITR 4S-> Income from salary and professional income.

  • You need to choose the forms based on your income source and fill the same. After filling the same you need to upload it. You will receive an acknowledgement ITR V for the return filed through online.

    Take a print out, sign and send it to the central processing center in Bangalore within 120 days from the date of filing. Your return will be considered as filed only after the receipt of the ITR V. There is no need to send the ITR V if you are having digital signature.

    What happens if I do not file my returns on or before the deadline?
    As per the section 234 in the Income tax act, there are various penalties and implications attached to delay in filing or non-filing of your returns.

    Interest under section 234 A for delay in filing of return after 31st July

    If you need to pay tax and filed return after 31st July then you have to pay interest of 1% for every month for the tax due for delay in filing of returns. For example, if you need to pay Rs.50,000 as tax for the financial year 2012-13. The company had deducted TDS of Rs.30,000 and you didn’t pay the remaining Rs. 20,000 within the due date 31st July 2013. You have decided to file your return in the month of October 2013. Then you have to pay interest of Rs.600 for the delay of return filing under section 234 A.

    Interest under section 234 B for nonpayment of advance tax

    Any tax payable has to be paid on or before 31st March of every year. If the tax liability exceeds Rs.10000 in a financial year and not paid the tax on or before 31st March then 1% interest will be charged for every month because of nonpayment of advance tax.

    As per the above example the interest to be payable under sec 234 B is Rs.1400. This is in addition to the interest levied under sec 234 A.

    Also there will be additional interest levied under sec 234 c for non-payment of advance tax within the specified deadline.

    Discretionary Penalty:

    If you have not filed returns even after one financial year from the assessment year, you need to pay the discretionary penalty of Rs. 5,000. Say for example, you have not filed the returns for the last assessment year, 2012-13, you can file it in the current assessment year 2013-14 without any penalty.

    But if you are missing it this year too and filing it in the next assessment year, 2014-15, you need to pay the penalty of Rs. 5,000. In case of nonpayment of full or partial tax in the current or subsequent financial year, you will end up paying the penalty of Rs.5000+1% each month.

    Capital loss to be carried forward:
    In case of capital loss, it is mandatory to file it before July 31st of the assessment year. The capital losses are not allowed to carry forward if you file your return beyond the due date. However, in case of capital loss due to selling your property, land or a house, you are allowed to take it forward even if you are filing late.

    Revised Filing:
    It is very, very important to remember not to do any mistakes while filing tax returns. If so you need to do a revised filing. If you file your return through online then the necessary rectification should also be done through online only.

    Delayed filing of your taxes will not affect getting refund, if any. However, not only avoiding penalties, filing your returns on time will save you in many situations. If you want to apply for a visa to any country like USA, Europe, UK and all, it is mandatory that you submit the documents related to income tax filing.

    There are also processes involved while getting loans from banks where you will be asked to submit the IT related documents. Not paying or filing returns on time may lead to rejection of visa or loans.

    The author is Ramalingam K, an MBA (Finance) and Certified Financial Planner. He is the Founder and Director of Holistic Investment Planners ( a firm that offers Financial Planning and Wealth Management. He can be reached at