Fintech founder, Ex-banker, Passion for Investments & Right-by-the-client approach of financial planning, Ignited by Politics, moved by Football & astrology!
Jun 13, 2023 • 13 tweets • 5 min read
SEBI has come out with EOP guidelines which hugely impacts how Direct Plans are currently being sold in the country. Read on for finer details:
1) All online platforms to classify themselves as EOP1 or EOP2 which means an Execution-Only Platform
#mutualfunds#directplans#SEBI2) Background - Most of the online platforms offering Direct Plans operate under the SEBI RIA (advisory) regulations but owing to the size & scale of business they act as mere facilitators of Direct Plans. They dont necessarily give full-fledged advisory services to clients.
Apr 15, 2021 • 8 tweets • 5 min read
Quick thread on understanding buybacks.
1) Why is it done:
If a company is cash rich and has no foreseeable deployment opportunity in its own business it can go for big dividends or use that money to buy back its own shares (1/8) #InfosysBuyback #InfosysQ42) How does buyback help:
When a company purchases its own shares, its outstanding free float in the market reduces. So just assume if a company had 100 shares in the market and it takes back 10 from the market, the available base is now only 90 shares. (2/8) #investing #BuyBack
Mar 7, 2020 • 6 tweets • 3 min read
Prioritising Equity over AT1 bond holders in #YesBank draft resolution is a first in this country!
In all fairness @RBI is setting up a bad precedent for the bond industry by subverting their rights. Critical takeaways: 1) Scares away a potential source of capital for all banks
2) Existing AT1 holders will start dumping their stock in fear of similar subversion in future as well. 3) This can lead to a potential escalation in yields. Raising Cost of capital in future for other players 4) There have been cases of PSU bank mergers previously as well
