Best Interest rate on Fixed Deposit Account

[masonicinvestor]

What do you mean by 1/85? Can multiple coop banks not default? Will insurance cover each bank? And when there is default, how long do you think it will be before the insurance pays back and will they pay my interest ?

Anyway, i dont see any rationale of investing in them, given their questionable management and track record. Why will i take all of this hassle, Debt Mutual Funds have given me 9 -11 % annualized returns for few years. This will reduce in future but real returns ( Interest - inflation) should still be fine. I see my capital much more secure and diversified in them. I also get indexation after 3 years.

i cannot see why he should take risk with these banks for mediocre returns, when Thread starter does not even want to take risk in equity (which i think should be reconsidered as investment is for 10+ years. i have much more returns from equity than debt over last 10 years and it is more than 10% compounded).

Probability is of 1/85, Yes insurance will cover each bank for 1 lakh, payment of insurance money is done within 1-2 years of bank default. Usually before that it is bought by a bigger bank to maintain stability. You will not get the interest only the principal amount. The only risk in this transaction is not getting interest and opportunity cost of funds. It is overall a riskless transaction.

Rest, I agree with all your opinions about debt funds and equity. I am a BIG fan of debt myself.

Coming to indexation is possible to post capital loss in income tax aswell using indexation.

 

[Subhadip]

What I will suggest is some what rare.

To have all money in liquid bees.

Here u will get yearly 6% around.

Now pledge all liquid bee. Have that money to be used to sell CE and PE of far month contract which are thousand point away from current spot nifty price.

And cover those and shift at the time of end of every month.

By this u can get around 2 % per month. Now combining both return One can generate around 14 to 20 % return per year. Now carry on compounding every year.

 

[masonicinvestor]

What I will suggest is some what rare.

To have all money in liquid bees.

Here u will get yearly 6% around.

Now pledge all liquid bee. Have that money to be used to sell CE and PE of far month contract which are thousand point away from current spot nifty price.

And cover those and shift at the time of end of every month.

By this u can get around 2 % per month. Now combining both return One can generate around 14 to 20 % return per year. Now carry on compounding every year.

Excellent. I have been researching selling out of money options for premium for a long time now.

 

[TracerBullet]

What I will suggest is some what rare.

To have all money in liquid bees.

Here u will get yearly 6% around.

Now pledge all liquid bee. Have that money to be used to sell CE and PE of far month contract which are thousand point away from current spot nifty price.

And cover those and shift at the time of end of every month.

By this u can get around 2 % per month. Now combining both return One can generate around 14 to 20 % return per year. Now carry on compounding every year.

Once in a very rare while, Nifty might move 1k. Sooner or later, it will happen. Any plan for it as we wont have any hedge ?

 

[tradedatrend]

Have that money to be used to sell CE and PE of far month contract which are thousand point away from current spot nifty price.

And cover those and shift at the time of end of every month.

By this u can get around 2 % per month.

selling 1000 point OTM CE & PE would fetch maximum 1.50 for CE & PE each i.e. 3*75= Rs 225 at a margin of ~80K

which would be hardly 0.25 / 0.30 return per month.

If selling 1000 points OTM CE & PE would fetch 2% return per month, mutual fun managers wouldn't have to do any hard work.

Beside it once in 4-5 years 1000 points also could be breached and might lead to big destruction of capital for a meager return

 

[Subhadip]

selling 1000 point OTM CE & PE would fetch maximum 1.50 for CE & PE each i.e. 3*75= Rs 225 at a margin of ~80K

which would be hardly 0.25 / 0.30 return per month.

If selling 1000 points OTM CE & PE would fetch 2% return per month, mutual fun managers wouldn't have to do any hard work.

Beside it once in 4-5 years 1000 points also could be breached and might lead to big destruction of capital for a meager return

The current price of October expiry 7800 pe at 28.50 and 9500 ce 24.5

 

[Subhadip]

Once in a very rare while, Nifty might move 1k. Sooner or later, it will happen. Any plan for it as we wont have any hedge ?

Look. I am not telling to sell blindly. Anytime one can take hedge and get profit out of that too

 

[masonicinvestor]

Once in a very rare while, Nifty might move 1k. Sooner or later, it will happen. Any plan for it as we wont have any hedge ?

I am not sure sir, But I think there is possibility of adjustment of the position easily mitigating the loss. I am not an expert. Someone else might answer this more thoroughly.

 

[tradedatrend]

The current price of October expiry 7800 pe at 28.50 and 9500 ce 24.5

The very assumption that nifty will not breach this range (700-800 points) IN A TIME PERIOD OF 3 MONTHS is very dicey in itself.

Mere a glance at Jan to Feb or March to May data gives a clear idea about the extent of capital destruction, which is bound to happen sooner than later.

As far hedging is concerned - hedging it by 50/100/200 point further OTM CE & PE will take away whatever the little charm it has.

As far adjustment is concerned - every adjustment will be few points negative adjustment and again will take the charm away out of it.

Option selling is a very very dynamic activity, anybody interested in a sound sleep should not indulge in option selling for mere few more percentage than FD.

There is no free lunch in the market.

 

[tradedatrend]

Look. I am not telling to sell blindly. Anytime one can take hedge and get profit out of that too

First thing, after hedging it will not be 2% per month.

Second thing, after hedging also by the end of an year one may not be in net positive territory given that far month options are being sold.