OnlineTradingInvesting.com
OnlineTradingInvesting.com was created mainly for helping beginner traders, advanced traders & investors of all levels and to teach them how to invest in the market and how to trade in the market, effectively and efficiently. It consists of all the very basics you need to know before getting involved in the financial markets. You will learn about the market in general, stock exchanges, stocks, the stock market in general, bonds, mutual funds, options, futures, currency trading – FOREX and many other things. The basic information is free and is included in the articles. We have also provided material where you can further your education and perfect your investment and trading skills. We have created this site so that new investors/traders do not go into the market uneducated and end up losing all of their money.
India’s fixed deposit rates & types of NRI accounts online.
The Foreign Exchange Management Act (FEMA), 1999 is a set of guidelines governing financial transactions of non-resident Indians. A non-resident Indian (NRI) can open and operate a bank account in India. This does not require the permission of the Reserve Bank of India (RBI).
The NRI should use the services of a bank authorized to handle foreign exchange transactions by the RBI. Such types of accounts are called NRO accounts, and even the post offices in India have the facility to accommodate such account-types.
Get free information on India FD rates & different kinds of NRI accounts below: www.nriinvestindia.com/banking.html
Different NRI accounts and their benefits:
Demat Account for NRIs
In the developed countries, the system of deposits and associated services are well-defined. This has helped streamline online share trading. It has also given a rise to foreign direct investment. The National Securities Depositories Limited (NSDL) is a national body in India that wants to achieve in this in India. The NSDL, being controlled by the Securities and Exchange Board of India (SEBI, helps investors overcome the burden of investing in India by offering well-evolved depository services.
NRE and NRO Accounts
NRI’s can have two account-types – NRE and NRO accounts. They are expanded as Non-Resident External and Ordinary Non-Resident Rupee accounts. To credit money to an NRI, you deposit funds in their NRO accounts. NRI’s use the NRO accounts to make investments in India.
NRI Bank account-types
The following are some widely used banks accounts by NRIs. They are:
- NRE savings/FD account
- NRO savings/FD account
- FCNR FD account
Understanding the NRE savings/FD account
This type of bank account can be used by non-resident Indians. You can manage your foreign currency through this bank account. All your earnings in the foreign country can be deposited in this account. This is an easy way to bring your money into India.
You open a NRE account as a Savings and Fixed deposit account in any of the banks. You are not levied any sort of tax. NRE accounts are exempted from wealth tax. You maintain the value of your earnings in the national currency, which is the Indian Rupee.
You can even open a joint account. You can also nominate somebody as this facility is available with NRE accounts.
Demerits of NRE accounts
The banks buy your foreign currency earnings at Indian rates. When you withdraw foreign currency, you get valuation in the selling rate of the bank. You may have to bear a conversion loss, because you have no option than to buy at the selling rate of the bank.
Since exchange rates are volatile, your earnings in the NRE account are exposed to such fluctuations of the exchange rate.
NRO Fixed Savings and Deposit Account
The interest rate you earn in this account is levied 30% tax. There is also surcharge and education cess levied. Your savings and fixed deposit accounts are charged such.
You maintain this account for crediting legitimate earnings. Banks are given the option to determine the interest rates offered to you.
For term Deposits, banks decide the interest rates offered on NRO deposits, which cannot be higher than those offered by them on comparable domestic rupee deposits.
FCNR (Foreign Currency Non-Resident) Fixed Deposit Account
You earn Indian rates on your deposits in this account. You get overdraft and nomination facility. Your deposits are exempt from tax. Only certain types of currencies are allowed in this account. You need to check with your bank on this.
Rates offered by banks
As per the RBI, banks can decide on the rates offered to NRI account-types. This is actually a beneficial thing considering that some banks may offer a higher deposit rate, and you can think of opening an account with this bank.
How to invest in SIP – Systematic Investment Plans in Mutual Funds?
SIP investing is a simplified monthly amount that is debited to your account automatically for investment in equity and debt instruments by a mutual fund. If you are not experienced enough and confident to play in the stock market on your own, the SIP is an excellent way to let mutual funds manage your money in the stock market. It is a regular and equal payment into a mutual fund, trading or retirement account for reinvesting into a wide array of stocks for getting optimum returns.
FREE information on SIP investing: Know more >>
Long term returns
It is a regular and equal payment into a mutual fund, trading or retirement account for reinvesting into a wide array of stocks for getting optimum return. You can benefit from a long term investment advantage as it is common for many stock traders to book their profits very early or too late to make good profits.
Stock market experts have always said that you can only make money by staying invested for the long term. You can also gain from the dollar-cost averaging as well as avail of the opportunity to save regularly by making the first SIP payment.
You can buy shares at different prices over a long period of time, but gain from the dollar-cost averaging that in the end reduces the price of each share. The average cost per share of the security will automatically go down in future.
As an investor you can plough back money from dividends earned into more stock which is known as the dividend reinvestment plan. With the SIP method of investment, you are assured about your money being debited each month at a specific date.
The scheme allows investors to buy units each month on a predetermined date. But your best bet would always be to start an SIP when the stock market index has hit a low. You can expect to reap rich profits over time as the value of your investment will go up.
The mutual find will also spread your money over many sectors which will enable your money to grow. All sectors do not perform simultaneously and a loss from one can be offset with profits from the others.
Experts handle your investment spreading over many portfolios
Over time, your money will experience the highs and lows of the stock market that will also ensure a reasonable return. If the market remains volatile for some time, you may lose in the stock market by investing on your own. The greatest benefit of SIP is that your money is spread over a longer period of time to weather any periodic volatility that can wipe away your money.
With the money going into mutual funds, it would be handled professionally.
They have their own investment techniques and know exactly which sector to tap and when. All asset management companies charge very little entry loads and the entire process is cost effective as well.
Your savings habit also becomes far more disciplined as the money is invested through automated debit system of your account. But the major reason of opting for an SIP is that you get all the benefits of stock market investing without having any knowledge of stock price movements.
The SIP investment works out like this. You may invest a certain amount of money on a fixed number of units. If you can buy the units when the value is low owing to the stock market upswings and downswings, you can easily get the unit cost worked out much lower. It will help you get more profit when the market picks up and the unit price shoots up.
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