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How to invest in INVITs in India?

Real estate investment trusts, or REITs, offer a unique opportunity to investors. By pooling the resources of many individuals, REITs allow everyday people to access large-scale real estate investments that would otherwise be out of reach. And because REITs are required to distribute at least 90% of their taxable income to shareholders in the form of dividends, they provide a regular source of income for investors. Additionally, REITs offer the potential for capital appreciation as the value of their underlying real estate assets increases.

INVITs are a great way for investors to get involved in infrastructure assets, such as toll roads, power plants, and pipelines. They are required to distribute at least 90% of their taxable income to shareholders, which makes them a good source of income. INVITs also offer the potential for capital appreciation as the value of their underlying infrastructure assets increases.

To analyze REITs or INVITs, you have to can refer to these metrics: 

Earnings growth

Macroeconomic view of properties

Gross asset value 

Debt to GAV

Net asset value

Price to NAV

Credit Rating

How to invest in a REIT or INVIT in India?

When it comes to investing in a REIT or INVIT, you have a few different options. You can buy shares through a brokerage account like you would with any other stock. Alternatively, you can invest in a REIT or INVIT through a mutual fund or exchange-traded fund that specializes in these types of investments. No matter which route you decide to go, it's always important to do your research and carefully consider the risks and potential rewards of any investment before making a decision.  If you want to learn more about each of the following metrics to analyze a REIT or INVIT in detail, head over to the REITs and INVITs Analysis blog. There, you can find information on the best performing INVITs in the market and make an informed decision about where to invest your money.

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Learn to trade with moving averages

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Introduction to Moving Averages | Technical Analysis

Moving averages can be a useful tool used by traders to make educated choices. Moving averages are calculated by determining the price that an asset has averaged over a specified time. For instance, if studying a moving average over the last month then you'll need to add the closing prices for the last 30 days , and divide them by 30.

One of the advantages of using moving averages is that it will help remove random price movements which gives you a clearer view of the overall trend. This is especially helpful during times of high volatility, when prices fluctuate wildly and it's difficult to know what's happening.

When looking at different moving averages, bear in mind that higher-quality moving averages have a greater influence on resistance and support levels. As a principle, higher moving averages are more suitable as indicators for the long term, whereas smaller ones (such as a five-day moving average) are better for short-term indicators.

Moving averages are an effective way to analyse price fluctuations and detect trends. In the event that the value of the particular stock is higher than the moving mean line, it could mean that it's trending upwards, and the average may act as an aid. If the price falls below the line of the moving average this could mean the price is falling and the moving average may act as a resistance.

Formula of Moving average

MA = (D1+D2+D3 +………. Dn) / n

The 'D' in this example is the data points and "n" is the count of data points.

There are various kinds of moving averages, which include simple Moving Average (SMA), Weighted Moving Average, as well as the Exponential Moving Average (EMA)

If you're interested in learning how to use EMA i.e. exponential moving average, and its use in pullback trading visit the Pullback Trading using EMA Breakout Strategy blog to learn how to trade pullbacks with ease.

Formula of Moving average

MA = (D1+D2+D3 +………. Dn) / n

The 'D' in this example is the data points and "n" is the count of data points.

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Introduction to Reversal Patterns

As a trader, one thing that we look upto every single day is the Price Chart? The price chart which comprises of candlesticks captures some of the most important information like opening, closing, high and low of an underlying asset in a single single. Candles make it easier for traders to see the most important aspects of the trading action for each period.

In this article, we will introduce to you the concept of reversal patterns along with a brief discussion on important reversal patterns that form in the stock markets and how to interpret them when you are trading.

What are reversal patterns?

Reversal patterns mean the formation of candlesticks which indicate the end of the existing trend (uptrend or downtrend). When such formation appears in a downtrend, it indicates a bullish reversal or end of selling spree and onset of buying spell. Conversely, when a trend reversal pattern forms in an uptrend, it warns traders of a possible end to bullish run and onset of a slump.

Important Reversal Patterns

Head and shoulder pattern

Inverse Head and shoulder pattern

Double top

Double bottom

Triple top 

Triple bottom

If you want to learn about each of these patterns, head over to the Ultimate guide to reversal pattern blog and learn to trade these patterns in actual markets. 

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Read about debt mutual fund analysis in India on LearnApp

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Difference between Equity Mutual Fund and Debt Mutual Fund

Let us look at the main difference between an equity mutual fund and debt mutual fund

The equity mutual fund invests in equity shares and related securities while the debt mutual fund invests in government securities, debentures, and other money market instruments.

Equity mutual funds have a investment horizon of a longer period of time while the debt mutual funds have a shorter investment horizon. 

Equity mutual funds are highly volatility in the short term while Debt mutual funds are relatively less volatility in the short term.

Equity fund expense ratio is much higher in an equity mutual fund while it is much lesser for a debt mutual fund. 

That’s it. These are major differences between an equity mutual fund and a debt mutual fund. In case you want to learn how to analyze a debt mutual fund, head over to the debt mutual fund analysis blog and learn the top 5 metrics to analyze a debt mutual fund.

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How to identify different types of trends in the stock markets?

A trend is the fundamental direction of a particular stock or index that it is moving. The process of studying current trends or the behavior of the price of a commodity to determine the future trends is referred to"trend trading.

A well-known expression in the market, which is that a trend is your friend. It basically means that a good trader should always invest in the trend, not in opposition to the trend. A trade against the trend could cause wealth loss. Analyzing trends can aid in identifying early withdrawal from stocks when the trend is changing. The trend of a stock is an important factor to consider when you are deciding what stocks to buy.

Let us understand the three types of trends that occur in the stock markets.

Uptrend

An uptrend is a market that is characterized by prices that are moving higher. It is also known as a bullish market. The opposite of an uptrend is a downtrend. Investors tend to buy into an uptrend and sell into a downtrend. Stocks that are in an uptrend are usually leading stocks. How to draw a support line/ zone?

Find three standalone price levels where the price faced difficulties to break below.

Then mark it with a horizontal line that rays into the future.

That’s it.

Downtrend

A downtrend is a term used in technical analysis to describe a situation in which a financial instrument, security or commodity continuously loses value over time. The price of an asset or security is said to be in a downtrend when it's falling and it's expected to continue falling in the near term. A downtrend can be either short-term or long-term. Short-term downtrends are followed by uptrends and vice versa.

It's a sign that investors are naive about the direction of the stock. It's advised to sell it when it's still moving upwards instead of waiting for the time when it could fall lower.

How to draw a resistance line/ zone?

Find three standalone price levels where the price faced difficulties to break above.

Then mark it with a horizontal line that rays into the future. That’s it.

Sideways

A sideways trend is the phenomenon where the value of stocks does not make higher highs or higher lows, nor lower highs or lower lows; but rather when the price of stocks stays within a certain interval. The sideways trend is a very important phenomenon, because it indicates that there is no trend in the market. When the market is in a sideways trend, it is a good time to review your investment strategy. You should pay close attention to these things: Fundamentals of the market, to see if the value of stocks has increased or decreased. Market cycles, so you can ascertain if the sideways trend will last for a long time. A trend that is currently active in the market. You can do this by looking at the trends that have been active for the last few days.

In this instance it's not advised to put money into security for prolonged lengths of time. Instead, scalping can prove to be an opportunity to earn money.

Now that you’ve understood the different types of trends that occur in the stock markets, it’s time that we also learn how to trade them. Trading price action is probably the simplest method of trading price behaviour. Head over to the price action blog to learn more about the key tools used for price action trading.

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Difference between Historical Volatility and Implied Volatility

The phenomenon of rapid price movements is called volatility. The price charts are a bit like a person's mood swings. You can see the highs and lows, and you can see when things are about to change. It is volatility that the options traders and hedge funds love to take advantage of.

First, let us take a look at historical volatility and then move on to understanding implied volatility.

What is Historical Volatility?

Historical volatility is a statistical measurement of how much a given stock moves up and down. As the name suggests, historical volatility measures a stock’s price as compared to its average or mean. 

A stock with higher volatility is inherently riskier because there is a bigger chance the stock’s price will drop significantly.

Whereas, it can also be potentially more rewarding since there is also a possibility that the stock’s price will make a big jump upward. Stocks tend to generally become more volatile during times of uncertainty.

What is Implied Volatility?

Implied volatility, on the other hand, looks at how the market is pricing a security in the future and can help traders predict price movements.

A stock with a higher implied volatility generally has options contracts with higher premiums.

Historical volatility and Implied volatility are important concepts for anyone looking to understand the stock market. By understanding how it works, you can better assess risk and construct a portfolio that meets your needs. For more information on implied volatility and its impact on options pricing, be sure to check out the article What is Implied Volatility written by LearnApp.

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Top 3 things to avoid while selecting a health insurance policy

Health insurance co-payment

A lot of people find the phrase "co-payment" confusing, and often choose to overlook it when purchasing an insurance policy. The co-payment is the percentage of the claim amount that you'd be required to pay, while the remainder will have to be paid by an insurance company.

Therefore, prior to signing your mediclaim policy, make sure to check whether there is any co-payment provision that could reduce the amount of your claim. If you can, buy a plan that does not include sub-limits. However, many insurance companies will offer a copayment for those with pre-existing medical condition or crossed an age limit.

Sub-limits for diseases

Sub-limits are the monetary caps set on your claim on each particular illness by the insurance company. It's important to know that the sub-limits for health insurance generally won't apply to the total amount of your bill. It will instead be able to cover specific circumstances. When you're deciding on the health insurance plan ensure that you are looking at the sub-limits.

While they could be more affordable, you must ensure that they meet your needs. Health insurance plans with limits may not provide the same coverage which means you pay the cost of premiums and other costs above the limit.

Room rental restrictions

The maximum amount that can be imposed on room rent or boarding costs for hospitalization is referred to as"room rent. Health insurance policies generally provide room rent for as high as 1 -2% of the amount covered. If your total insured is 5 lakhs and the limit for room rent is 1 percent then you can rent a room for Rupees 5,000 per day. In certain instances, the limit on room rent is set.

After you've learned the three most important things to keep in mind when buying medical insurance, it's crucial to know how to choose which is the best health insurance policy for you. We'll then look at the 7-Point selection model that looks at factors such as post-hospitalization and pre-hospitalization care Restoration benefits, Daycare benefits, Domiciliary cost as well as No Claim Bonus and many more. So head over to the 7-Point checklist to select the best health insurance policy blog and watch the workshop video to get yourself protected with the best health insurance for you and your family.