Understanding Self-Serving Bias & Why You Need To Take Responsibility How many times have you boosted your talent when things went right and luck when things did not go as planned? Most of us have done this multiple times and we are likely to do it few more times as well. And this behaviour in the field of behavioural financeis called as self-serving bias. Simply put, self-serving bias is the tendency to credit good outcomes to our skills and talents and unfavourable outcomes to fate and luck. Overconfidence and misattribution of causes are the two parts of self-serving bias. Examples of self-serving bias can be found in our day-to-day life. For e.g., a job applicant after being rejected can attribute it to the personal preference of the interviewer. Also, he may attribute his selection in the next interview to his qualifications and skills . In the investing world, we tend to attribute good performances of our investments to our investment skills and negative returns to the broade...

Investing in mutual funds through Systematic Investment Plans (SIPs) remains a favored strategy for wealth accumulation. As of February 2025, aligning your investments with your risk tolerance is crucial. Below are curated SIP portfolios for conservative, moderate, and aggressive investors. 1. Conservative Portfolio Objective: Preserve capital while achieving modest growth. Large Cap Funds: Focus on established companies with stable returns. Debt Funds: Invest in high-quality bonds to ensure steady income. 2. Moderate Portfolio Objective: Balance between risk and return. Multi Cap Funds: Diversify across large, mid, and small-cap stocks. Hybrid Funds: Combine equity and debt instruments for balanced growth. 3. Aggressive Portfolio Objective: Maximize returns with higher risk tolerance. Mid Cap Funds: Target companies with high growth potential. Small Cap Funds: Invest in emerging companies for substantial gains. Note: These portfolios are based on analyses of mean rolling re...

Combination of EMI and SIP can save you lot of money What if your Home loan tenure is reduced without increasing EMI , even if the interest rate remains the same? Sounds interesting? Read it. In year 2010, I bought the flat into the Ahmedabad for which I took the home loan of Rs 48 Lacs from one bank. At that time the interest rates were around 10.5%. So I decided to take the loan for the maximum tenure available, i.e. 20 years as I could afford the EMI of Rs. 47922/-. The bank RM came to my office for completing the paperwork. While filling the forms he asked me about the tenure which I would like to go for. I told him to go for maximum tenure i.e. 20 years. Bank’s RM told me, “Sir maximum limit is not 20 years it is 25 years”. According to my calculation I was ready for paying  Rs 47992/, an EMI amount for 20 years of tenure considering 10.5% interest and Loan of Rs 48 Lacs. So if I chose to go for 25 year, EMI would be lesser. I tried to do the exact calculation and ended up wi...

Unlocking Wealth: Mastering the Art of Building a Well-Balanced Portfolio through mutual funds Investing in mutual funds is an excellent way for individuals to diversify their investment portfolio and potentially earn higher returns. However, building a well-balanced mutual fund portfolio requires careful consideration and understanding of the various factors that can impact your investment success. In this blog post, we will guide you through the essential steps to help you create a resilient and profitable mutual fund portfolio. Understanding Mutual Funds Before diving into the intricacies of building a well-balanced mutual fund portfolio, let's first understand what mutual funds are. A mutual fund is an investment vehicle that pools money from multiple investors and invests in a diversified portfolio of stocks, bonds, or other securities. This diversification helps spread risk and can potentially deliver more stable returns compared to individual stock investments. Determine You...

Introduction Fixed Deposits (FD) and Mutual Funds are two of the most popular investment options. But which one is better for your money? The choice depends on factors such as risk tolerance, expected returns, and financial goals. In this guide, we will compare FD and Mutual Funds to help you make the best decision. What is a Fixed Deposit (FD)? FD is a secure investment where you deposit a lump sum amount in a bank or financial institution for a fixed tenure at a predetermined interest rate. The returns are guaranteed, making it a low-risk investment. Benefits of FD: Guaranteed Returns: Interest rates are fixed and do not fluctuate with the market. Low Risk: Ideal for conservative investors looking for safety. Tax-Saving Option: Tax-saving FDs (5-year tenure) offer deductions under Section 80C. What is a Mutual Fund? Mutual Funds pool money from various investors and invest in stocks, bonds, or other assets. They offer higher returns compared to FDs but come ...