How to Make Money with Minimum Risk

You might have heard from lot of financial planners that those who cannot understand stock markets should go for mutual funds and best way to invest in mutual funds is through Systematic Investment Plan (SIP). In Systematic Investment Plan you need to invest every month in a mutual fund on a fixed date for a period of time say one year or two year etc. As per the financial consultants, this will give good returns. In case there are periods where markets are high for certain time and then it goes down for certain time then the average investment will even out and you will get positive returns.

This is totally misleading statement especially if you start out at when the stock markets are on a high. I have done that and found how misleading it is. The moment you stop the SIP the fund stops getting evened out and if you stop when the markets are at a low for last few months, then you chances of making any profits are quite less. Financial planner and mutual fund companies are the only gainers.

SIPs are for lazy investors. Most people want to earn money from stock markets automatically and they do not want to take much risk and in the bargain do not earn what they could have earned potentially.

How to Profit from Stock Markets?
If you want to make money in stock markets I will suggest a simple solution. Invest in index funds. In case you are unaware, index funds are mutual funds which are not actively managed. They invest money in all the funds which represents a index. For example, Nifty is collection of top 50 companies in India. Similarly Sensex consists of top 30 companies. If the index fund you choose is based in Senxexm the index fund you choose will have proportionate investment in all the stocks which are included in Sensex. Whenever Sensex increase by 5% that index fund will also increase by 5% and if the Sensex fall by 10% that index fund's value will also reduce by 10%.

As per the history of Sensex and any other index in the world, the indexes increase over time. So investing in them is a almost certain way to have profits.

Another advantage of index funds is, since it is not actively managed, they have very less fund management charges as compared to other actively managed mutual funds.

Although for a short period of time like one or two or three year a fund may give more returns than the index for over a longer period of time they are not able to beat the returns of index funds consistently. So go for index funds.

How to Invest in Index Funds
Making profits is easy. Invest when markets are down and sell when markets are high. So next question is how. It is simple. First fix some money say for example 5000 or 10000 rupees or dollars whichever is your currency. Decide that whenever markets fall by 5% then you will invest that money and whenever market rises by 7% you will sell units worth that money. Usually fall like 5% and rise of 7% will not happen more than 5 to 7 times a year.

Based on the averages you will definitely make money. If you want to increase the returns than you can increase the money you invest or sell in a transaction. So with each fall you buy more units are cheaper price and when it rises you book your profit. Whenever you buy or sell, mark when you will buy or sell next. For example if you sell today when the market is at 100 points then your would sell next time when market is at 107 and buy at 95. You would now mark these two as the new transaction points.

I have observed the pattern for last few years and have seen that it can make money. Another advantage is you do not need to watch the markets every day very closely. You only need to observer if it is gaining and moving towards the new markers. When it is close then you need to make sure that you do the transaction.

If you follow the above steps you can make money without much risks.

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Twelve ways to sharpen your brain

It is a fact the our brain, like the other body muscles sharpens more as we use it more. More neurons are created to store newer experiences. More the number of these neurons, sharper it will be.

There is another similarity between the exercise of the muscles and the brain. If you continue to exercise the same set of muscles, they will grow stronger till some point and then the muscles becomes used to that exercise and does not grow after that. Similarly when we keep on feeding the brain same experiences time after time it stops recording them at a deeper level and stronger neurons networks are not developed.

On the other hand, if you exercise different set of muscles, then body will respond to that exercise better and body will have more muscle mass and same is the case with brain cells. When it fed with newer experience it becomes sharper. Newer experiences are recorded at a deeper level and for that you need to feed it with different experience which are not recorded previously.

The question is how to feed the brain with newer experiences. The answer is to do some activity to which you are not used to. Doing that requires more concentration and brain is feed with different impulses from the muscles or the sense organs which are being used. This leads the brain to record that experiences which add new neurons making the brain stronger.

Here are twelve simple activities which can sharpen your brain.

1. Drive to a place through a new route.


2. Ride a bike facing backwards while someone else is driving. Be careful it may be dangerous


3. Go for trekking to a new place.


4. Solve some puzzle.


5. Write or draw with left hand if you are right handed or vice versa.


6. Play carom board with your weaker hand


7. Play Chess especially with a player with who you do not normally play with.


8. Learn a new skill like Skating or Skiing or Salsa.


9. Paint.


10. Try something adventurous like rock climbing or scuba diving.


11. Meditate


12. Try some new Yoga Postures. You can visit my blog www.headfirstyoga.com for Yoga articles.

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Write Down Your Goals To Achieve Them

Yesterday I finished one of my goals in 50 Things I Want To Do or Achieve Before I Die. It was really good to complete one of my stated goals. Now that I am able to write Done in front of the goal I can now move on to next goal with more confidence than ever that I can achieve them also.

Benefits of Writing Down your Goals
It proved to me what I have read for a long time. If you want to achieve something, then write it down. Writing down your goals in a way compels and more than that encourages you to at least have a go at them and once you do that you are in a better position to achieve them.

Writing down your goals also good because writing means more of a commitment and less of a wish. Only you have the power to achieve your goals and the satisfaction which you will get from achieving can not described in words.

Writing down your goals and making the list public will also put some positive pressure on you to accomplish the goals. That is why I have published the list on my blog. If you do not want to publish it on blog then you can share it with your friends and family and also tell them to remind you after that.

Another benefit of writing down your goals is you will only write the goals which are quite meaningful to You. Lot of time we try to accomplish goals which are set by others for us. That is not good. Once you write down your goals, you take charge of your life. You will then be able to decide the destiny and journey of your life and not others.

Action Item
Take a pen and a paper and write down following three list.
a. Your Goal for next three months. include various things which you would love to do in life and not just health and money, for example learning something new skill or visiting some place. (For example my personal aim is to learn Skating.)
b. Similar list for next six month.
c. Similar list for next one year (2010).

Now paste the list on your wall where you do most of your work. I think after six month you will have a lot to shout about. Go and get a pen NOW.

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