News

I have to put a disclaimer before I state anything. My knowledge on stocks and investments could not be called anything but rudimentary. Any investments I did in equity market, I did it based on advice given by my father.

That said, I have started to look at the market recently. And from my understanding, the basics of investment is something along the following lines. When you can take risk, which is usually at earlier part of your life, your investment portfolio should be more in equity and less in debt market. Equity market has a higher risk, but does give you a higher returns. Debt market on the other hand, is less in risk and in returns. The basic premise behind this is that, at a younger age you have time to recover from any losses the risk of investing in equity, than the time you have at later part of your life.

But there cannot be a preset ratio or correlation of the ratio to your age. There are other factors that you need to take into account. There might be some responsibilities, or some loans that you need to repay. The market conditions too need to be taken into account. There is no point investing into equity when you cannot get a return, just because you are young.

That brings me to hunting and searching (googling, or should I say binging?) for current news, tips, and articles on investment strategies. Since I did take advice from my father, and that has acutally helped me build assets, I thought I would do what he did. As a kid, I remember him reading through several newspapers and related magazine, one among them being Economic Times.

I do not buy newspapers. I am not sure how that will effect the newspaper industry in India. I turned to the online version. And that led me to these two articles.

• Stock market faced strong sell-off last week by Deepak Mohoni
• Increase your exposure to debt funds by Pallavi Mulay

These are two articles published on the same day, by the same news outlet. One says the debt market is strong, while the other advices to invest in equity market.

What am I, a newbie investor, to make of this?

My friend Deepak came across an article in Rediff and talks about the effect of release of Tata Nano.

The article mentions that Tata is putting Nano to market at the price tag of Rs 1 lakh.

Due to this, car becomes an affordable commodity to a lot more people in India than it were before. As Deepak said, it would have a lot of impact to the already congested traffic situation in most of the cities. My interest though is what effect Nano would do on the economy?

The credit crunch in US has affected India. Reason could possibly be the involvement of India in IT industry. A change in one market of a country would spread to the other markets of that country.

Since more people are able to buy a car, there is possibility of new markets opening up. Even those who are not able to do a full down payment, owing to the fact that the amount is much lesser than before, they will try to buy the car acquiring a loan. This is one of the direct impacts I can think of. This seems like a good time for investors.

Nano may be a small variable, but it would be interesting to see to what extent the wheel turns the other way due to a chain-reaction.

About a week back, on responding to a comment by Raghavendra on my post on Personal Digital Gadgets, I started to look at the state of newspaper industry in US and world.

“In 2009 and 2010, all the two-newspaper markets will become one-newspaper markets, and you will start to see one-newspaper markets become no-newspaper markets,” said Mike Simonton, a senior director at Fitch Ratings, who analyzes the industry. Read more.

I have been in US for two years, and this does not seem surprising. Due to Internet, the people in US seem to have gotten used to getting news and information for free. The traditional newspaper industry, unable to come up with a way to deal with this, seems to be in soup. But those who distribute news and information supported by advertisement are giving competition to traditional newspaper industry. Laymen are using mediums like blogs. Even though they are not as big as the traditional industry, they seem to be doing ok. The effect of this is that advertisers are buying less from newspaper industry.

This does not seem to be the case in India.

“I do not see ads generating revenues enough to substantiate a firm. Internet penetration is low in India. Also, more brands need to take up this mode of advertising,” said Rajesh Srivathsa. Read more.

Seeing as it is, it seems like the newspaper industry will be staying alive in India for some more years.

So here is the update I promised.

My friend at work invited me to come along with him today evening. Mac OS X Leopard would be released, and he did not want to be at the end of the queue.

And true to his words, the Apple store at the Cherry Creek mall had a queue of around 200 people in the queue around 5:30 pm. The store closed down two hours before, and would open up at 6:00 pm.

Yeshwant is - what you can call ( and what he calls himself) an Apple cult member.

He let me use his iPhone to post a short update. It was short becuse I found it hard to twiddle around with the touch screen interface. Pretty cool technology - but call me old school - I found it sort of an hassle.

The queue did not last long once it was 6:00 pm. The orderly crowd of Apple cult moved right to the counter to get their copy of the Mac OS.

Here is a snapshot of me in the Apple store that he took with the iPhone along with the other snaps.

He proudly demonstrated that you could send the photos using email - though there were few hitches. Blame it on the WiFi netowork there.

All in all - it was a nice sneak peak into the community of geeks and artists who I partially associate myself with. But here I am a little past midnight, composing this using the Gutsy Gibbon release of Ubuntu.

Hopefully not for long - but on the bright side, I getting myself out of the stronghold of Microsoft and Windows.