GOLDEN RULES OF ACCOUNTING

There are three golden rules of accounting on which whole accounting is based. There are three types of accounts and all of them have their respective rules for posting.

1. REAL ACCOUNT: This account is related to assets .
Its rule is Debit what comes in
Credit what goes out.

2. NOMINAL ACCOUNT: It is related to various expenses, incomes, losses and gains. Its rule is
Debit all expenses and losses
Credit all incomes and gains

3. PERSONAL ACCOUNT: It is related to persons or body of individuals or association […] Read more

BEST INVESTMENT OPTIONS FOR 2012

In my earlier posts I have discussed about various investment alternatives. But in this post I will be discussing about 5 best investment options for 2012.

1. DIAMONDS: These are most popular area of investment in current scenario because a number of popular diamond mines are closing so decrease in supply will result in increase in demand and price. The current market is doing well and is proving to be a popular choice for those who are looking to make money.

2. GOLD: The prices of gold is increasing day by day so according to current scenario it is the best option […] Read more

HOT MONEY

Hot money is that money which flows regularly between financial markets as investors attempt to ensure they get the highest short term interest rates possible.

Capital transferred from one financial centre to another seeking the highest interest rates or the best opportunity for short term gain, mainly from changes in exchange rates.It is also known as flexible income.

Money or capital received through Foreign Institutional Investors (FIIs) is known as Hot Money.

[…] Read more

PORTFOLIO- MEANING AND MANAGEMENT

Portfolio is a group of financial assets such as stocks, bonds and cash equivalents. It is a collection of investments all owned by the same individual or organization. Portfolios are held directly by investors or managed by financial professionals. It should show a spread of investments to minimize risk.

Portfolio management is about analyzing strengths, weaknesses, opportunities and threats in the choice of debt vs. equity, domestic vs. international, growth vs. safety and many other trade offs encountered in attempt to maximize return at a given level of risk.

Some major tasks involved with Portfolio management are:
1. Taking decisions about investment mix […] Read more

PRECAUTIONS WHILE SELECTING TAX SAVING INVESTMENTS

You must be thinking of using tax saving investments for planning tax but precautions should be taken while selecting these investments. Following things should be considered while selecting tax saving investments:

1. LIQUIDITY: How fast your investments can be converted into cash? When will you be able to access your money in one year or two years or so.

2. RISK AND RETURN: Access what type of investor are you? Whether you are risk averse (do not want to take risk), risk lover (love to take risk) or risk neutral ( risk don’t affect your decision). As criterion that follows with investment […] Read more

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