Guest Lecture On Investment In Equity For Finance Students
Finance Department organized a guest lecture by Shri Sanjay Agarwal, CA on 6th January 2020. Mr Sanjay Agarwal, apart from being a Chartered Accountant, is also a keen equity investor. To put it in his own words he is CA by profession but an equity investor by choice. He is based in Kolkata, where his CA firm is located.
He addressed the students about matters pertaining to investment in equity. He spoke about various avenues of investment available to salaried individuals and explained why it was not prudent to keep all savings in bank fixed deposits, as the post-tax return was quite often below the level of inflation. According to him, equity is an asset class that can give a reasonably satisfactory return, as it is taxed at a lower level than debt instruments. He cautioned that equity trading for quick gain is not at all advisable as it is akin to gambling and could lead to an erosion of capital. Further, any investment ought to be made only after first considering risk-bearing capacity and risk appetite. Investments in equity could be made directly through an online trading account or through equity-based mutual funds. However, to realize a satisfactory return with a greater degree of certainty it was necessary to stay invested for at least 5-6 years.
Shri Agarwal is an advocate of fundamental analysis and recommended that investors should target companies with a solid financial profile. He asserted that a beginner must identify companies in which mutual funds had invested as they could be relied upon to vet the financials of a company prior to investing. Another advice was to favor companies that are likely to be benefitted by government policies and perform well in the near future. Such investments would be both safe and financially rewarding. The session was interactive with students’ active participation throughout the talk.
He addressed the students about matters pertaining to investment in equity. He spoke about various avenues of investment available to salaried individuals and explained why it was not prudent to keep all savings in bank fixed deposits, as the post-tax return was quite often below the level of inflation. According to him, equity is an asset class that can give a reasonably satisfactory return, as it is taxed at a lower level than debt instruments. He cautioned that equity trading for quick gain is not at all advisable as it is akin to gambling and could lead to an erosion of capital. Further, any investment ought to be made only after first considering risk-bearing capacity and risk appetite. Investments in equity could be made directly through an online trading account or through equity-based mutual funds. However, to realize a satisfactory return with a greater degree of certainty it was necessary to stay invested for at least 5-6 years.
Shri Agarwal is an advocate of fundamental analysis and recommended that investors should target companies with a solid financial profile. He asserted that a beginner must identify companies in which mutual funds had invested as they could be relied upon to vet the financials of a company prior to investing. Another advice was to favor companies that are likely to be benefitted by government policies and perform well in the near future. Such investments would be both safe and financially rewarding. The session was interactive with students’ active participation throughout the talk.
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