Product Note: Direct Equity

PRODUCT NOTE
Direct Equity
Getting your share of ownership of the company. When we invest in the equity share of a
company, we are in legal terms buying the ownership of the company.
Non-Convertible Debentures
NCD cannot be easily converted into equity or stocks. NCDs have a fixed maturity date and
the interest can be paid along with the principal amount either monthly, quarterly or
annually.
NCD carry tax implications depending on the tax bracket the investors fall under. If NCDs are
sold within a year or lesser STCG will be applicable as per the income tax slab rate. If the
NCDs are sold after a year or more or before the maturity date, LTCG will be applicable at
20% with indexation.
Public Provident Fund
PPF was introduced with the objective to mobilize small savings in the form of an
investment. It can also be called as saving-cum-tax saving investment that enables one to
build a retirement corpus while saving on annual taxes.
Deposits made under PPF are deductible under section 80C of the Income Tax Act
National Pension Scheme
National Pension Scheme (NPS) is a pension cum investment scheme launched by

Government of India to provide old age security to Citizens of India. It brings an attractive
long-term saving avenue to effectively plan your retirement through safe and regulated
market-based return.
 80CCD (1), which comes under Section 80C, covers self-contribution. Salaried
employees can claim a maximum deduction of 10% of their salary, while self-
employed individuals can claim up to 20% of their gross income.
 80CCD (2), which is also a part of Section 80C, covers the employer’s contribution
towards NPS. This benefit cannot be claimed by self-employed individuals. The
maximum amount that an individual is eligible for deduction is either the employer’s
NPS contribution or 10% of basic salary plus Dearness Allowance (DA).
 Under Section 80CCD(1B), individuals can claim an additional amount of Rs.50,000
for any other self-contributions as NPS tax benefit.
Senior Citizen Saving scheme
The Senior Citizens Savings Scheme (SCSS) is primarily for the senior citizens of India. The
scheme offers a regular stream of income with the highest of safety and tax saving benefits.
It is an apt choice of investment for those over 60 years of age.
PRODUCT NOTE
 Investments made in a Senior Citizen Savings Scheme account qualify for income tax
deduction benefit up to Rs. 1.5 Lakh under Section 80C of the Income Tax Act, 1961.
 Interest on SCSS is fully taxable. In case the interest amount earned is more than Rs.
50,000 for a fiscal, Tax Deducted at Source (TDS) is applicable to the interest earned.
This limit for TDS deduction on SCSS investments is applicable from AY 2020-21
onwards.
Sukanya Sam Riddhi Yojana
 Sukanya Samriddhi Yojana (SSY) is a small deposit scheme for the girl child launched
as a part of the 'Beti Bachao Beti Padhao' campaign.
 It has a tax benefit. It comes with a maximum tax benefit of Rs 1.5 lakh under section
80C of the Income-tax Act. The amount invested can be withdrawn on maturity or on
closing the account. This amount is exempt from tax, ensuring that the girl child can
utilise the amount in its entirety without having to pay tax on it.
Mutual Fund
A mutual fund is a type of investment vehicle consisting of a portfolio of stocks, bonds, or

other securities. Mutual funds give small or individual investors access to diversified,
professionally managed portfolios at a low price
Equity based mutual funds.
An equity fund is a mutual fund that invests principally in stocks. It can be actively or
passively (index fund) managed. Equity funds are also known as stock funds. Equity mutual
funds try generating returns by investing in stocks of companies all market capitalisations.
They are the riskiest class of mutual funds; hence they have the potential to provide higher
returns than debt and hybrid funds. The performance of company plays a significant role in
deciding the investor’s returns
Debt based mutual fund
 Debt funds are mutual funds that invest in fixed income securities like bonds and
treasury bills.
 Debt funds invest in various securities, based on their credit ratings. A security’s
credit rating signifies whether the issuer will default in disbursing the returns they
promised. The fund manager of a debt fund ensures that he invests in high rated
credit instruments. A higher credit rating means that the entity is more likely to pay
interest on the debt security regularly as well as pay back the principal amount upon
maturity.
Hybrid mutual funds
These are the investment which are invested in not only on one type of investment security
but various types like bond, share, stocks etc. it is complete portfolio of mutual funds.
PRODUCT NOTE
Mutual fund index fund.
An index fund is a type of mutual fund with a portfolio constructed to match or track the
components of a financial market index, such as the Standard & Poor's 500 Index (S&P 500).
An index mutual fund is said to provide broad market exposure, low operating expenses and
low portfolio turnover. These funds follow their benchmark index no matter the state of the
markets.
SIP (Systematic Investment Plan).
Systematic Investment Plan (SIP) is an option where you invest a fixed amount in a mutual
fund scheme at regular intervals
Portfolio management services
Portfolio Management Services (PMS), service offered by the Portfolio Manager, is an

investment portfolio in stocks, fixed income, debt, cash, structured products and other
individual securities, managed by a professional money manager that can potentially be
tailored to meet specific investment objectives.
ETF (exchange traded fund)

An exchange-traded fund (ETF) is an investment fund traded on stock exchanges, much like
stocks. An ETF holds assets such as stocks, commodities, or bonds and generally operates
with an arbitrage mechanism designed to keep it trading close to its net asset value,
although deviations can occasionally occur.
Gold Investment
 Gold is one of the most preferred investments in India. High liquidity and inflation-
beating
 capacity are its strong selling points, not to mention charm, prestige, and so on.
Though
 there are phases when markets witness a fall in gold prices, it won’t last for long and
always
 makes a strong comeback.
Equity
Equity refers to stock. It is the amount of capital contributed by the owners of the company.
In accounting terms, it is difference b/w company total assets and total liabilities
Bank
PRODUCT NOTE
A bank is a financial institution where customers can save or borrow money. Banks also
invest money to build up their reserve of money. Banks may give loans to customers under
an agreement to pay the money back to the bank later, with interest
Debt
Debt is a liability that a company incurs when running its business. The debt ratio gives
company leaders insight into the financial strength of the company.

Product Note: Direct Equity

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PRODUCT NOTE

Public Provident Fund

National Pension Scheme

National Pension Scheme (NPS) is a pension cum investment scheme launched by

Sukanya Sam Riddhi Yojana

A mutual fund is a type of investment vehicle consisting of a portfolio of stocks, bonds, or

Equity based mutual funds.

Debt based mutual fund

SIP (Systematic Investment Plan).

Portfolio management services

Portfolio Management Services (PMS), service offered by the Portfolio Manager, is an

ETF (exchange traded fund)

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