CAGR Insights is a weekly newsletter full of insights from around the world of web.
Chart Ki Baat
Gyaan Ki Baat for this week:
Relaxation on KYC with effect from 1st June 24.
- KYC status Validated: All kinds of investor are allowed to transact in both existing and new folios.
- KYC status registered: Resident individual investor can invest in existing mutual funds and NRI’s can transact in both existing and new mutual funds.
- KYC Status Hold: All the investors are restricted to invest.
Here’s the list of curated readings for you this week:
Personal Finance
- What Quant Mutual Fund Investors Need to Know Amid SEBI Investigation? The SEBI investigation into Quant Mutual Fund over a front-running crisis has led to significant investor redemptions, totalling Rs 1,400 crore in three days. Despite this, the net asset values of many Quant Mutual Fund schemes have remained stable or even increased. Financial advisors recommend continuing with current investments due to Quant’s historically strong performance and unique quantitative investment approach, which minimizes reliance on individual fund managers. Read here
- Government Initiative- Uniform KYC Implementation in Financial Services: The Modi 3.0 government is actively pursuing the implementation of uniform KYC across the financial services sector. SEBI has mandated KYC registration agencies (KRAs) to upload verified KYC details of all capital market investors into the Central KYC Records Registry (CKYCRR) by August 1, 2024. This move aims to streamline KYC processes across financial products. Read here
- Balancing Judgments- Process, Luck, and Investing Outcomes: Investing outcomes can be a product of process or luck or both. In the current markets, this thought is a good way to step back and think of the broader picture. It is possible that a lot of us are getting swayed into judgements because of an outcome we like to see. But outcomes should only be one variable of a judgment, not the driver itself. Read here
Investing
- Overlooked Skills for Modern Success: The passage discusses several overlooked yet valuable skills necessary for navigating life effectively. Franklin D. Roosevelt’s resilience, characterized by accepting inconveniences, scepticism, respectful disagreement, effective communication, clarity, and acknowledging luck alongside risk, is crucial for a competitive advantage. These skills, often undervalued in contemporary contexts, are essential for personal growth, effective communication, and decision-making in various aspects of life. Read here
- The Importance of Exceptional Leadership: The author categorizes successful leaders into four groups: 1) Repeat Winners- Leaders with a proven track record of growing businesses. 2) Overlooked Superstars- Leaders who shine during a turnaround or step up from second-in-command roles. 3) Batman and Robin Combinations- Pairs of leaders who complement each other, like Warren Buffett and Charlie Munger. 4) First Time Founders/CEOs- New leaders showing promise through their actions and decisions. Read here
- Regulatory Reforms for RIAs- SEBI’s Proposed Changes: SEBI is planning to ease regulations for registered investment advisors (RIAs) with new proposals expected in July. These changes may eliminate the need for RIAs to renew certifications every three years, increase the client limit from 150, and remove experience requirements for assistants. This move aims to address RIAs’ concerns about compliance burdens and facilitate their operational flexibility. Read here
- RBI’s Dominance in India’s Bond Markets- Deciphering the Whisper: Stanley Druckenmiller’s 2015 speech emphasized the importance of central banks in the Indian bond markets, particularly the Reserve Bank of India (RBI). The RBI’s unpredictability and domestic factors drive policy decisions, surprising consensus forecasts in one out of every five meetings since 2010. Despite its limited influence on equity and forex markets, staying attuned to RBI moves is essential for bond market participants in India. Read here
Economy
- RBI’s Monetary Policy Committee Split Over Rate Cut: The RBI’s Monetary Policy Committee has a disagreement over whether to change the policy repo rate, which has been at 6.5% since February 2023. Two external members, Ashima Goyal and Jayanth R. Varma, propose a 0.25% rate cut to boost growth and reduce unemployment. However, RBI Governor Shaktikanta Das and other internal members argue the rate should remain due to high food prices. Watch
- Crude Oil Demand to Peak: A Positive for India? The International Energy Agency predicts that global crude oil demand will peak by 2029 and decline, with rising oil supplies from countries outside OPEC+ potentially lowering prices. India, which imports a significant amount of crude oil, could benefit from lower oil prices as it reduces its import bill. The country is also focusing on reducing oil dependency through electric vehicles, green hydrogen production, and biofuels. Read here
- India’s Rapidly Growing Luxury Market: India, traditionally a smaller player in the global luxury market at 5%, is experiencing rapid growth compared to China, which has seen slowed growth this year despite its previous dominance. India’s GDP growth of 8.2% in 2023 has sparked significant expansion in the luxury sector, encompassing real estate, hospitality, apparel, accessories, and automotive industries. Read here
- Indian Elections 2024- Unexpected Results and Economic Implications: In the recent Indian national elections, PM Narendra Modi’s BJP party unexpectedly lost its majority, contrary to predictions of a continued dominance. The election highlighted a shift in voter priorities towards local issues and demands for increased government support. The campaign focused heavily on economic concerns such as subsidies and inflation, overshadowing ideological debates. Despite concerns over economic disparities and inflation impacts, India’s economy continues to grow robustly, albeit with challenges in income distribution. Read here
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That’s it from our side. Have a great weekend ahead!
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