Financial Data of a company plays a key role for an investor willing to invest in a company. And in case a company is going public for the first time, DHRP plays a key role for them to analyse the company. However, with the recent introduction of Confidential Pre-filing DHRP, the general public does not get insight into the company’s key financial data.
In today’s blog, we will introduce a concept called “Confidential IPO Filing” by a company, along with its key benefits and risks.
Meaning of Confidential IPO Filing
A confidential IPO Filing is a process in which a company submits its IPO document, known as the Draft Red Herring Prospectus, to the Securities and Exchange Board of India. But this filing is not made public. This process allows the company to evaluate the feedback from the regulating authorities. This is a part of the pre-IPO process.
How Does the Confidential IPO Process Work?
The working of the Confidential IPO is mentioned below:
Appointing Merchant Banker: Appointment of a merchant banker or lead manager is the first step towards the IPO filing process. They help in preparing the draft red hearing prospectus (DRHP).
Submission of DRHP: Once the merchant banker prepares the DRHP then it must be filed with the SEBI without disclosing the details to the public. This document carries key parameters of the company’s financial ratios, business model, etc.
Review by SEBI: After the documents are submitted to SEBI, they will be reviewed by SEBI. And if there are any observations, they will be made to the merchant banker and the company.
Revised DRHP: In case of any observation by the SEBI, it will be rectified on an immediate basis, and the revised DRHP will be filed with SEBI.
Public Issue: Once the DRHP is approved by the SEBI, then the company is ready to go ahead with its public issue and can make a public announcement of its issue.
Listing: As soon as the IPO allotment process is completed, the company can get its shares listed on the exchanges.
Difference Between Confidential and Traditional IPO Filing
The key differences between confidential and traditional IPO filings are as follows:
Particular
Confidential IPO Filing
Traditional IPO Filing
Filing
The IPO filing is done privately.The company files a public version later, after addressing SEBI’s comments.
The IPO is filed publicly, and every investor gets to know about the details. All details are visible to investors from day one.
Flexible
It offers great flexibility. The company can delay or modify the IPO.
Any withdrawal of the IPO by the company comes to the knowledge of the public and can impact the company’s reputation significantly.
Speculation
This can avoid speculation by the public, as early details are not available.
Because of the availability of early IPO details, the chances of speculation related to the grey market premium will increase.
Suitability
The confidential IPO filing is suitable for micro, small, and medium-scale companies.
These types of IPOs are generally opted for by large companies.
Information
The chances of getting the details are very low, since the filings are not disclosed publicly.
All financial, operational, and risk disclosures are public from the start, open to competitors and the media.
Benefits of Confidential IPO Filing
The key benefits of confidential IPO filing are as follows:
Privacy: Through a confidential IPO filing, the companies can keep their important data private at the early stage of the IPO process. This can help them avoid getting unwanted attention from the competitors.
Improve Final Draft: Confidential IPO filing helps in making necessary corrections before making the issue public.
Less Media Coverage: Companies can easily prepare for their public issue without worrying about the media coverage, market speculations, etc.
There are significant risks related to Confidential IPO filing for the companies, a few of which are mentioned below:
Lack of Investors’ Feedback: Due to the limited availability of information, the investors’ feedback is not available to the company.
Risk of Insider Trading: Although SEBI mandates strict confidentiality, sensitive details shared with intermediaries like merchant bankers or auditors could still be at minor risk of misuse.
Trust: Because of secrecy, it can sometimes lead to the creation of a perception among the investors that the company is hiding something.
Is a Confidential IPO Filing Allowed in India?
Yes, the Confidential IPO filing is allowed in India according to the regulations specified by the Securities and Exchange Board of India (SEBI) in November 2022. The regulations are defined under “Pre-Filling of Offer Document”. According to this regulation, a company can submit their draft document to SEBI without making it public.
On a concluding note, through Confidential IPO Filing, companies can smartly go public. They can file their IPO documents with SEBI without letting the public be aware of it. It allows the company’s management to fine-tune the errors in the IPO document without having any impact on its reputation. This mechanism was introduced by SEBI in November 2022. However, this IPO filing benefits the company directly; along with this, it also carries certain disadvantages for them. Hence, an investor should consult their investment advisor before making any investment in an IPO and go through their prospectus.
S.NO.
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Yes, a confidential IPO filing is allowed in India after it was introduced by SEBI in 2022.
Who can opt for confidential IPOs?
Confidential IPOs can be filed by any company. However, they are generally filed by companies in the IT and pharma sectors.
When does an investor get to know about the confidential IPO filed by a company?
When the company launches their marketing campaign about the IPO after incorporating the regulatory feedback from the SEBI. The general investor or public gets to know about it.
Can a company withdraw their IPO after its filing with SEBI?
Yes, a company can easily withdraw their IPO after its initial filing with SEBI. This step is generally taken by the company when they think market conditions are not favourable or require significant changes.
Can an investor have access to the Pre-filing DHRP of a company filing a Confidential IPO?
No, an investor does not have any access to the Pre-filing DRHP of a company filing it confidentially. They are reviewed by the SEBI privately.
When it comes to trading, it is not just about selecting the right stocks. But it is also about selecting the right trading strategy so that you can earn more. This is where algorithmic trading comes into play. Allowing you to trade using the computer softwares, it allows you to earn better. Also, it avoids the chances of missing small opportunities.
In fact, in the past few years, algorithmic trading in India has grown rapidly. It is more common these days. People are able to trade with no need for constant checks. This saves time and ensures better results for starters as well.
But do you know how you start algo trades? Well, if you are also looking for the answer, read this guide. Know how to do algo trading and all the details you need here in this guide.
What Is Algorithmic Trading?
Algorithmic trading is simply using computer programs. It uses proper strategies with algorithm analysis to make trade calls. This is valid for the buy and sell . You can use it in the stock market easily and save time. It’s fast, disciplined, and helps you trade without letting emotions take over.
Key Features
Automatic Execution: Set the rules once, check, and get going ahead.
Data-Driven Decisions: Say yes to logic and facts and no to guesswork.
High Speed: Algorithms react to market changes within milliseconds.
Error-Free Trading: Reduces mistakes that usually come with manual trading.
24/7 Monitoring: Keep an eye on markets even when you are not online.
Customisable Strategies: Design your strategies based on what you need.
Step-by-Step Guide to Starting Algorithmic Trading
Getting started with algorithmic trading may sound technical at first. But this is not true. You need to start with logic. Once you know, you can start with algo trading easily.
Here’s how to begin your journey into algorithmic trading in India in a simple, structured way.
Step 1: Learn the Basics
Every great trader starts with the fundamentals. The same is applicable when you start algo. Learn how markets move, what triggers price changes, and how trading instruments work. You should understand market orders, stop loss, indicators, and strategy design.
Ensure that you check the SEBI rules for algorithmic trading. This means margin requirements, trade limits, and order approvals. This will help you trade confidently and within regulations.
Step 2: Pick a Programming Language
You don’t need to be a developer to get started. Even if you do not know how to code, you can start algo trading. The most common language used in it is Python. You will find multiple pre-made strategies and tools that you can use to automate the trades.
Then there are powerful libraries like Pandas, NumPy, and TA-Lib for analysis. The no-coding ones are great for beginners. This will help you learn how to do algo trading.
Step 3: Select a Trading Platform
Once you understand the basics, choose where your algorithm will run. To learn algo trading, you can go for:
API-Based Platforms: You will get full control over strategies. This is good for experienced traders.
Broker-Integrated Platforms: You will get the readymate tools to use. This is better for new people in algo trading.
Select a SEBI-registered broker only. This will avoid the chances of any issues or penalties. Hence, compare and take time to find the right one.
Step 4: Build Your Trading Strategy
Your algorithm is only as good as your strategy. So, you must first start with a simple one. This can be based on any of the following ideas:
Trend Following Strategy: Uses indicators like moving averages or MACD to follow price direction.
Arbitrage Strategy: Exploits small price differences between related securities.
Mean Reversion Strategy: Works on the idea that prices tend to return to their average value.
Keep it simple in the beginning and refine as you gain experience.
Step 5: Backtest Before You Trade
Before going live with algorithmic trading in India, ensure you test. This is known as backtesting. Here you will check your strategy on the past data. It will be during different time periods. The idea is to know if it works well or not.
You can use platforms for real simulations as well. Once you get a positive outcome of your testing, you can start working in the market.
Step 6: Try Paper Trading
After backtesting, start paper trading. Here you will use simulated money instead of real money to do trading. When you start algo trading in India this way, you can avoid the risk of losses. You can learn, and when you are sure, you can start real trading in the market. This step lets you observe order speed, data accuracy, and execution quality, preparing you for actual trades.
Step 7: Open a Trading Account with API Access
To execute automated trades, open a Demat and trading account with a broker. Ensure that the broker offers you API access like Pocketful. This is important to sync algo trading strategies. Complete KYC and link your bank account. Now, apply for API keys. These keys connect your algorithm directly to the broker’s system, allowing safe and fast trade execution.
Step 8: Go Live and Monitor
When everything is ready, start small. Deploy limited capital and monitor how your strategy performs in live markets. Keep checking for system errors, delays, or data mismatches. Ensure that you are monitoring as well. This is key to ensuring better results from trades.
Like every trading method, algorithmic trading has its strengths and limitations. So, here are the key ones that you should be aware of:
Pros of Algorithmic Trading
Faster Execution: Algorithms analyse the trades faster. They can check millions of data in seconds. So, the chances of making mistakes are reduced and you gain better outcomes.
Emotion-Free Decisions: Automated systems follow logic, not feelings. This ensures consistency and prevents impulsive trades.
High Accuracy: You just need to define the logic once. Then the system will work on trading on its own. There is low human intervention needed.
Backtesting Capability: Before you trade live, you can test your strategy. This is on the past data, but gives assurance. The better the results, the higher the chances of performance.
Scalability: You can manage multiple trades or instruments. All this can be done at once and this will help with profits.
Learning Advantage: When you learn algo trading, you gain both market knowledge and technical skills that can enhance your long-term trading performance.
Cons of Algorithmic Trading
Technical Complexity: Building or customising algorithms is not easy. You must know logic and code. A mistake can lead to losses.
System Failures: Even well-designed systems can malfunction. This can be due to the internet or software problems. This can lead to delays.
Over-Optimization Risk: Excessive fine-tuning can be bad. It will make the strategy valid for certain situations only. This will consume time as well.
Market Volatility: Algorithms may react too quickly to false signals. Such instances can lead to losses or even miss out on better opportunities.
Initial Investment: Setting up tools, APIs, and software for algorithmic trading in India involves upfront costs that beginners should plan for.
In short, when you start algo, the key is balance in how you combine technology with strategy. You must monitor regularly and never rely entirely on automation. This will help to ensure better outcomes.
Algorithmic trading brings structure, speed, and discipline to every trade. For anyone exploring algorithmic trading India, the key is to learn first. Start small, and then you can go in with higher capital.
Once you learn algo trading, you’ll see it’s more about logic than luck. With the right guidance from Pocketful, you can build confidence, automate smarter, and grow steadily with every trade.
S.NO.
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Yes, SEBI allows algorithmic trading. But you must work with a registered broker or APIs only.
How can I start algo trading as a beginner?
You can start algo trading easily. There are platforms that help you learn with simulation. Then you can go in with a small amount and start trading eventually.
Do I need coding skills for algo trading?
Not always. Many no-code tools are there that can help with the algo trading. Just ensure you test the same before you start.
What are the benefits of algorithmic trading?
It improves accuracy, reduces emotional decisions, and executes trades faster.
How much money is required to start algo trading in India?
You can start with a small capital, usually between ₹10,000 and ₹25,000, depending on your strategy.
Whenever you look around India, one thing is clear construction is taking place everywhere. New roads are being built, flyovers, and new housing projects. This is why the materials sector (materials sector stocks) is in the news these days.Building material stocks like steel, cement, pipes, tiles, and adhesives are no longer just part of construction, but have become the engines of the country’s growth. In this blog, we’ll discuss the best material stocks in India for 2025 which could create significant opportunities for investors in the future.
What Are Material Stocks?
Material stocks are shares of companies that produce materials used in basic construction and manufacturing, such as steel, cement, glass, pipes, tiles, and adhesives. These companies transform raw materials into solid forms for further use in infrastructure, housing, manufacturing, and industry. Simply put: when a new house is built, a road is constructed, or a factory is opened, companies in this sector must procure the materials. For this reason, building material stocks and the broader materials sector remain important investment options.
A brief overview of the Best Material Stocks in India is given below:
1. UltraTech Cement Ltd
UltraTech Cement‘s story is deeply intertwined with India’s construction sector. Founded in 1983, the company is today considered one of the country’s most trusted cement brands. Headquartered in Mumbai, UltraTech is part of the Aditya Birla Group and has a presence in almost every state. The company has established itself not just as a cement manufacturer, but as a symbol of quality and durability. UltraTech’s contribution is visible across India’s major infrastructure projects whether highways or housing construction. Gradually, the name has become synonymous with the country’s strength and growth.
Know the Returns:
1Y Return (%)
3Y Return (%)
5Y Return (%)
14%
94.41%
165.19%
(Data as of 23 Oct 2025)
2. JSW Steel Ltd
JSW Steel is one of the companies in India’s steel industry that has given a new direction to the country’s industrial identity. Established in 1982, the company has today become synonymous with modern steel production. As part of the Mumbai-based JSW Group, it has carved a niche for itself by combining technology, quality, and innovation. The company’s plants are spread across India and it is considered the backbone of the construction, automobile, and infrastructure sectors. The hallmark of JSW Steel is its visionary approach – its ability to turn every change into an opportunity. This is why this name has become the pride of Indian steel today.
Know the Returns:
1Y Return (%)
3Y Return (%)
5Y Return (%)
18.85%
87.01%
250.77%
(Data as of 23 Oct 2025)
3. Tata Steel Ltd
When we talk about India’s industrial history, Tata Steel’s name comes first. Its foundation was laid by Jamsetji Tata in 1907, when the steel industry did not exist in the country. Its first plant in Jamshedpur showed India the path to self-reliance. This Tata Group company has always identified itself with trust, integrity, and quality. For years, it has not only manufactured steel but also promoted the “Tata values” that are the backbone of India’s industry. Today, Tata Steel is not just a company, but has become a story of the nation’s growth and trust.
Know the Returns:
1Y Return (%)
3Y Return (%)
5Y Return (%)
16.22%
71.87%
323.22%
(Data as of 23 Oct 2025)
4. Grasim Industries Ltd
Grasim Industries is the flagship company of the Aditya Birla Group, one of India’s oldest and most prestigious industrial conglomerates. It was established in 1947, when the country was just beginning its industrial journey after independence. The company initially began its foray into textiles, but gradually expanded into sectors such as cement, chemicals, and fibers. Today, Grasim is recognized as a company that has mastered the art of blending tradition and modernity. Over the years, it has been a reliable contributor not only to the industry but also to the country’s economic progress.
Know the Returns:
1Y Return (%)
3Y Return (%)
5Y Return (%)
8.64%
69.79%
264.71%
(Data as of 23 Oct 2025)
5. Vedanta Ltd
Vedanta Ltd is one of the few Indian companies that has shaped the country’s natural resources sector. Founded in 1976 and headquartered in Mumbai, Vedanta began as a small mining firm, but today it is active in various sectors, including oil, gas, metals, zinc, aluminum, and power. Vedanta has established itself as an organization that believes in responsible resource use and technological innovation. It has not only increased energy supply for India’s industrial development but also created employment and development opportunities in local communities. This is why Vedanta is considered a vital part of India’s progress.
Know the Returns:
1Y Return (%)
3Y Return (%)
5Y Return (%)
4.93%
69.24%
357.51%
(Data as of 23 Oct 2025)
6. Ambuja Cements Ltd
The story of Ambuja Cements began in 1983, when the construction sector in India was slowly growing. The beginnings were small, but the ambitions were big to produce superior cement and lay a foundation of trust. Within a few years, Ambuja earned the trust of the people through its work. Today, the name is not just a company, but an identity that is associated with the strength of every building. Headquartered in Mumbai, it has a presence across the country. Ambuja’s greatest strength has been its quality-first approach and its commitment to maintaining balance with the environment.
Know the Returns:
1Y Return (%)
3Y Return (%)
5Y Return (%)
1.29%
9.95%
122.50%
(Data as of 23 Oct 2025)
7. Shree Cement Ltd
Shree Cement was founded in Rajasthan in 1979, when the cement industry in India was not yet fully organized. Initially, it was a small company, but its honest work ethic and dedication to quality gradually gained recognition across the country. Today, Shree Cement is among the few companies that have built their reputation without much fanfare. The company’s focus on superior technology and energy efficiency has always set it apart from others. With its “low cost, high productivity” model, Shree Cement has now become a strong foundation of India’s cement industry, a foundation upon which the nation relies.
Know the Returns:
1Y Return (%)
3Y Return (%)
5Y Return (%)
18.54%
41.82%
36.57%
(Data as of 23 Oct 2025)
8. Jindal Stainless Ltd
Jindal Stainless Ltd was founded in 1970, when the use of stainless steel in India was very limited. At that time, the company reshaped the industry and gradually established itself not only domestically but also globally. Originating in Hisar, Haryana, the company has now become the largest manufacturer in India’s stainless steel sector. Jindal Stainless is characterized by its reliance on innovation and a strict quality approach. The company produces high-grade stainless steel used in automobiles, railways, construction, and household appliances. With its extensive experience and innovative thinking, Jindal Stainless has become a vital part of India’s industrial development story.
Know the Returns:
1Y Return (%)
3Y Return (%)
5Y Return (%)
22.85%
495.86%
1,267.10%
(Data as of 23 Oct 2025)
9. Berger Paints India Ltd
Berger Paints India Ltd was founded in 1923, when the paint industry in India was still in its infancy. At that time, it was a small company, but gradually gained recognition across the country for its innovation and quality of colors. Headquartered in Kolkata, Berger Paints is today considered one of India’s most trusted paint companies. The company’s focus has always been on providing customers with superior and sustainable solutions whether it’s interior paint or industrial coatings. Over its 100-year journey, Berger has proven that color can transform not just walls, but people’s lives.
Know the Returns:
1Y Return (%)
3Y Return (%)
5Y Return (%)
0.88%
11.71%
6.31%
(Data as of 23 Oct 2025)
10. UPL Ltd
UPL Ltd, formerly known as United Phosphorus Limited, was founded in 1969. At that time, India’s agricultural products and pesticide production was limited, but UPL pioneered a new approach. Based in Mumbai, the company is today one of the world’s leading providers of agri-chemicals and sustainable farming solutions. UPL’s mission has always been to provide farmers with technologies and products that protect crops and increase yields. With its innovation, environmentally friendly approach, and global presence, UPL Ltd is no longer just a company, but a powerful story of India’s agricultural revolution.
The key performance metrics of the Best Material Stocks in India are mentioned below:
Company
Operating Margin (%)
Net Profit Margin (%)
ROE (%)
ROCE (%)
P/E (x)
UltraTech Cement Ltd
12.22
7.96
8.54
9.16
56.06
JSW Steel Ltd
8.46
2.25
4.44
7.93
74.04
Tata Steel Ltd
7.51
1.36
3.75
8.49
56.29
Grasim Industries Ltd
15.67
5.02
3.80
5.86
46.99
Vedanta Ltd
22.82
13.42
36.36
26.92
11.89
Ambuja Cements Ltd
17.53
14.68
7.79
9.16
31.67
Shree Cement Ltd
7.86
5.82
5.21
6.67
98.02
Jindal Stainless Ltd
10.17
6.46
15.01
17.46
19.12
Berger Paints India Ltd
13.83
9.94
19.18
23.64
49.38
UPL Ltd
11.44
2.77
3.07
8.97
64.59
(Data as of 23 Oct 2025)
Why Material Stocks Are Important for Investors in 2025 ?
In India, it’s not just long-term investment that matters, but timely investment – and the materials sector is making significant strides in that direction. For example, Budget 2025-26 targets infrastructure investment at ₹11.21 lakh crore (US$128.6 billion), representing approximately 3.1% of the economy. This investment isn’t limited to roads and bridges, but extends to new housing projects, smart cities, logistics, solar, and metro networks. Consequently, companies manufacturing material stocks such as steel, cement, and adhesives and pipes are likely to benefit directly. Furthermore, input costs in this sector are improving, with manufacturing units adopting more integrated and low-cost models, resulting in a better return-on-investment profile.
Risks & Challenges in Material Stocks
Fluctuations in Raw Material Prices : Material companies’ earnings are directly dependent on the prices of coal, petcoke, iron ore, and electricity. When these costs rise, profit margins immediately come under pressure. Therefore, it is important to constantly monitor input costs.
Risk of Demand Volatility : This sector is linked to infrastructure and real estate. If government spending decreases or construction projects are delayed, sales may decline, impacting companies’ growth.
Increasing Competition and Overcapacity : Many new players have entered the market in the past few years. This has increased price pressure, and some companies have over-expanded production capacity, which could reduce profits.
Impact of Government Policies and Tax Changes : Changes to tax structures or carbon regulations by the government can increase costs. For example, the new carbon tax impacts the operating costs of cement and metal companies.
Energy Costs and Environmental Regulations : This sector is highly dependent on electricity and fuel. Increased energy prices or environmental compliance costs can increase production costs. Companies are now forced to invest in green energy and waste heat recovery.
Impact of Global Markets and Currency Rates : Many Indian material companies export, so their earnings can fluctuate due to changes in international demand or the dollar-rupee exchange rate. Steel and aluminum companies are particularly vulnerable to this risk.
Capital Costs and Interest Rates : This is a capital-intensive sector, requiring significant investment. If interest rates rise or funding becomes expensive, both project costs and debt increase, which can reduce net profits.
Analyze the company’s financial position : Before selecting any material stock, review its balance sheet. Low debt, consistent profits, and a good ROCE (Return on Capital Employed) indicate long-term sustainability of the company.
Understand raw material costs and sourcing : The earnings of steel, cement, or pipe companies depend on their input costs. Companies with their own mineral sources or long-term supply contracts are better at controlling costs.
Monitor sector demand and economic cycles : It is important to understand future demand in the sector the company operates in. Government infrastructure plans and real estate growth are the biggest drivers for this sector.
Trust the credibility and experience of management : The transparency and decision-making of the company’s leadership are crucial. Good management keeps debt under control and maintains growth trajectory even during difficult times.
Prioritize Sustainability and Energy Efficiency : Investors are now choosing companies that are adopting green energy and carbon reduction technologies. This not only reduces costs but also mitigates future regulatory risks.
Pay Attention to Dividend and Return Policy : Companies that pay regular dividends or conduct share buybacks are generally financially strong. This provides investors with reliable cash flow.
Balance Risk with Diversification : Avoid investing all your money in a single sector. Maintaining a balanced portfolio across sectors such as cement, steel, pipes, and adhesives provides lower risk and greater stability.
Conclusion
India’s materials sector has become the true foundation of the country’s progress. Whether it’s steel, cement, or building materials companies, each brand is shaping India’s growth story in its own right. Growing demand for infrastructure and housing will further strengthen these companies in the coming years. It’s time for a savvy investor to understand this sector deeply and trust the right companies because these are the industries that will shape the future of India.
S.NO.
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When thousands of trades are completed in the blink of an eye, this is the true speed of High Frequency Trading (HFT). It uses advanced algorithms and superfast computers, which make trading decisions in just a few microseconds. Today, approximately 60% of transactions in the Indian stock market involve HFT trading and algo trading. In this blog, we’ll explore what is HFT, how it works, which HFT companies are leading the way, and what its growing influence in India indicates.
What is High-Frequency Trading?
HFT or High-Frequency Trading, is an advanced trading technique that uses high-speed computers and complex algorithms to execute orders extremely quickly, sometimes thousands of trades per second. Human intervention is virtually nonexistent, as the entire process is fully automated.
Speed and Co-location Advantage: HFT’s greatest strength is its speed. As soon as market data is generated, these systems process it within microseconds and execute trades instantly. Co-location also plays a significant role when an HFT company’s server is located very close to the exchange’s server. This reduces data transmission time and can yield milliseconds of trading gains.
Real-Time Data Feeds: HFT systems read live price quotes, order-book updates, and trade ticks from the exchange in microseconds. The faster and cleaner the data, the faster the algorithms can identify opportunities.
Signal Generation: Quant models look for patterns in the incoming data such as minor price mismatches, order-book imbalances, or short-term momentum. Many firms now also use adaptive ML models so that the models can update themselves in response to changing markets.
Order Routing & Execution: As soon as a signal is received, the system immediately creates an order and sends it to the exchange’s matching engine. Orders are changed or canceled at the same speed. The goal is to achieve entry/exit speed while minimizing slippage, even with very small price gaps.
Co-location & Low-Latency Infra: To reduce latency, servers are co-located within/near the exchange’s data center. Packet processing is further accelerated using high-speed fiber, microwave/millimeter-wave links, smart NICs, and sometimes FPGA-based computing.
Risk Controls & Compliance: Strict guardrails operate with speed—maximum position limits, kill switches, order-rate limits, and real-time P&L/variance checks. This allows the system to immediately reduce exposure in the event of an error or malfunction and ensure compliance with regulatory requirements (e.g., OTR, logging, circuit breakers).
Monitoring & Post-Trade Analytics: Granular analysis of latency, fill rates, and slippage is performed after a trade. This data is what tunes models next time—which venues are faster, which strategies work best at what time, where to optimize the network/code, etc.
HFT Process Flow Table
Step
Description
Goal
Data Collection
Acquire and process live market data in real time
Making decisions based on the latest information
Signal Generation
Identifying patterns or opportunities through algorithms
High-Frequency Trading (HFT) isn’t just a game of fast computers and algorithms; its true strength lies in its strategies. Each HFT firm develops unique strategies to make profits by making accurate decisions in microseconds.
1. Market Making
In this strategy, HFT firms maintain liquidity in the market by continuously placing orders on both the bid and ask sides. Profits are generated from the small spread between the bid and ask. For example, if a stock is being bought at ₹100 and sold at ₹100.05, the HFT system profits by replicating this small spread multiple times.
2. Statistical Arbitrage
This strategy is based on mathematical models and data patterns. The system searches for temporary price gaps in two or more related stocks or indices.
3. Latency Arbitrage
This strategy relies solely on a speed advantage. HFT firms co-locate their servers to minimize data transfer delays. If a price change is first visible on one exchange, and another exchange shows it a few microseconds later, the system can immediately capitalize on the earlier change.
4. Momentum Ignition
In this strategy, the system identifies an ongoing trend and trades in that direction to capture market momentum. Sometimes, the system attempts to trigger momentum by placing small orders, as if to signal increased buying in the market.
5. Event-Based Arbitrage
Whenever major news breaks, such as RBI policies, company quarterly results, or economic data, the HFT system immediately reads the news and trades within seconds.
For example, if a company’s profits are better than expected, the system can immediately buy its shares, even before humans can react to the news.
6. Liquidity Detection
Some HFT models attempt to predict when and where large institutional investors are likely to place orders. If the system detects a buy order from a large fund, it preemptively positions in that direction. This allows the HFT firm to profit from market movements before they even begin.
HFT in India: Growth, Regulations & Major Players
Current Situation : Algorithmic/high-frequency trading is now a significant part of the market in India. According to some reports, approximately 55–60% of total trades on the NSE/BSE are believed to be algo/HFT-based. This figure may vary depending on the segment and source, but the dominance of fast-trading is clear.
Major Firms (Who’s Active) : Both international and domestic prop-trading and HFT firms are active in India. Examples include Tower Research, QuadEye Securities, Graviton Research/Graviton Capital, AlphaGrep, and Estee Advisors; these firms focus on low-latency trading and quantitative strategies. (Lists and profiles are available in public sources).
Infrastructure and History : Co-location services in India, introduced around 2010, offered the potential to reduce server-based latency, contributing to the growth of HFT. The nature of co-location and data feeds made speed-based strategies viable. (This issue has also generated public scrutiny and controversy, which has been subject to appropriate regulatory scrutiny.)
Regulations and Reforms (SEBI’s Approach) : SEBI has tightened the requirements and monitoring protocols for algorithmic/HFT activities, including co-location access, order-to-trade limits, audit trails, and agency/broker-level transparency. Additionally, SEBI has published recommendations/advisories on a framework for algorithmic trading for retail investors to balance risk and transparency.
Ultra-fast technology, executing trades in microseconds.
The process of automatically placing trades according to set strategies or rules.
Speed
Extremely fast—trades in microseconds or milliseconds.
Relatively slow trades can take seconds, minutes or hours.
Goal
Making repeated profits from small price differences.
Making decisions based on long-term strategies.
Technical Requirement
High-speed servers, co-location and low-latency networks.
Also possible with common server and brokerage APIs.
Risk level
Very high dependent on speed and technical errors.
Relatively low dependence on the success of the strategy.
User
Large institutional firms or quant trading houses.
Used by both retail and professional traders.
Regulation
Strict monitoring by SEBI and the exchange.
Relatively simple regulatory oversight.
HFT vs. Traditional Trading
Aspect
High-Frequency Trading (HFT)
Traditional Trading
Method of trading
Fully automated done by algorithms and computers.
Manual Humans place orders and make decisions.
Speed
Thousands of trades in microseconds.
Limited trades in minutes or hours.
Decision making process
Based on data and machine learning models.
Based on experience, emotions and market sentiment.
Cost
Very low spreads and minimal fees.
Relatively high due to time, brokerage and manual errors.
Risk
Major losses are possible due to technical glitches and wrong codes.
The potential for harm due to human judgment or emotional error.
Accuracy
Highly accurate, as there is no human intervention.
Limited accuracy, human error possible.
User
Institutional investors and quant trading firms.
Retail investors and traditional traders.
Control and monitoring
Under high-level surveillance systems and regulatory rules.
Less oversight, relying on individual responsibility.
Benefits of High-Frequency Trading
Improved Market Liquidity: HFT firms continuously place buy and sell orders, ensuring buyers and sellers are present in the market at all times. This reduces the bid-ask spread (the difference between the buy and sell prices) and allows investors to obtain better deals. Consequently, the presence of HFT makes the market more liquid and active.
Faster Price Discovery: When news or economic data is released about a company, HFT systems immediately identify it and trade accordingly. This helps the stock price reach the “right level” faster, meaning the market absorbs the new information more quickly. In the long run, this makes the market more efficient.
Lower Transaction Costs: HFT reduces trading spreads and increases execution speed, thereby reducing transaction costs. This benefits both large institutions and ordinary investors, as they are able to complete trades with a shorter timeframe.
Improved Competition and Transparency: The emergence of HFT firms has required brokerages and trading platforms to provide better technology and faster services. This not only increases competition but also brings transparency to the market. The record and execution of every trade can now be tracked within seconds.
Technological Improvements and Market Stability: Technologies developed for HFT such as low-latency networks, faster servers, and co-location systems are now strengthening the entire market infrastructure. These improvements have made trading more secure, stable, and faster.
Market Manipulation: Some firms use techniques like spoofing, i.e., misleading the market by placing fake orders. This can cause temporary price swings, leaving small investors at a disadvantage.The NSE co-location case demonstrated that unequal data access can impact “fair play.”
Risk of a Flash Crash: When thousands of algorithms work together, a technical or emotional movement can trigger a flash crash. This is what happened in the US in 2010, when the market plummeted by billions of dollars in a matter of minutes. Such accidents raise questions about market stability.
Unequal Access: HFT firms locate their servers very close to exchanges to gain a microsecond advantage. This makes it difficult for retail investors to compete, as “speed” becomes the driving force.
System Failures: Even a minor programming error can lead to losses worth crores. For example, in 2012, Knight Capital suffered massive losses in a matter of minutes due to a software bug. Therefore, firms now use real-time risk control and kill-switch systems.
Ethical and Regulatory Challenges: When some players profit solely through technological advantage, questions of fairness arise. If multiple HFT systems trade in the same direction, the market can become volatile. For this reason, regulators like SEBI are continuously increasing surveillance to ensure that the market remains transparent and balanced.
High-frequency trading has made the world of trading faster and more data-driven than ever before. Trades are now completed in the blink of an eye, and markets appear more dynamic than ever. This provides investors with better prices and liquidity, but it has also presented challenges such as technical glitches and unequal access. The way forward is to use technology wisely to keep markets both fast and fair for all.
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Putting money in gold is a timeless tradition in India, but buying the jewellery or coins can have some concerns like safety, purity, and high making charges that can reduce your profits. What if you could get all the benefits of owning gold in a smarter, simpler, and digital way.
This is where we see the Gold Mutual Funds in the picture, by investing in gold mutual funds, you can invest in gold digitally. These funds are the modern way to invest in gold, where the investors can own pure 24-karat gold on their phone or computer, without ever needing a locker. These mutual funds can be perfect for beginners and smart investors who want the safety of gold without the old-school hassles.
In this blog we will understand what a gold mutual fund is. Also, this blog will explain to you how gold funds work, why starting a gold SIP is a great idea, and list some of the best gold mutual fund options available in India today.
Understanding Gold Mutual Funds
How Gold Mutual Funds Work
A gold mutual fund takes money from investors and then collectively invests in gold, here a fund manager manages the investment and gold on behalf of the investors. By investing in gold like this you can actually buy real gold without the hassle to store the gold.
In India gold mutual funds work as a ‘Fund of Funds’ (FoF) meaning:
You invest your money in a gold mutual fund.
The fund manager collects money from all investors like you.
They use this money to buy units of a Gold ETF (Exchange Traded Fund).
This Gold ETF holds real, 99.5% pure physical gold in very secure vaults.
By investing using this method you get pure gold and the value of your investments move up or down depending upon the price of gold in the market.
This is the biggest gold fund in India and is also one of the oldest funds in India. Nippon gold fund gives customer returns that are closely matched to the performance of its underlying ETF, the Nippon India ETF Gold BeES.
2. HDFC Gold Fund
This is considered to be one of the most trusted fund houses of India, this fund invests in units of the HDFC Gold ETF. If you are looking for a reliable fund for your gold investments, this is the most popular choice.
3. SBI Gold Fund
This is the largest AUM in the gold funds category, which is backed by India’s most trusted bank, State Bank of India. This gold fund provides returns that correspond to the SBI Gold ETF.
4. Axis Gold Fund
Here, the fund invests in the Axis Gold ETF that copies the performance of physical gold. It allows investors to start investing in small SIP amounts.
5. Kotak Gold Fund
In this gold fund the returns are generated by investing in units of Kotak Gold ETF. This also acts as a diversified fund that combines gold and silver together to give broader precious metal exposure to the investors.
6. ICICI Prudential Regular Gold Savings Fund
This fund has the lowest expense ratio in this category and the fund generated its returns by investing in ICICI Prudential Gold ETF, making it cost-effective for the new investors.
7. Aditya Birla Sun Life Gold Fund
Here the returns are tracked based on the performance of Aditya Birla Sun Life Gold ETF, which offers another solid option from a well-known fund house.
8. DSP Gold Fund
Here the investment is done by investing in units of DSP Gold ETF and the returns are generated by this. For investors it is a simple way to invest in gold and diversify your portfolio.
9. Invesco India Gold Fund
In this gold fund the performance of Invesco India Gold ETF is tracked to get returns, it has a straightforward option for investors seeking to track gold prices.
10. Quantum Gold Fund
This fund invests in units of the Quantum Gold ETF and also has one of the lowest expense ratio compared to others which helps in cutting down the cost of investing and making increased profits.
Now that we have gone through some of the Top Gold Funds in India you might be thinking how can you invest in these gold mutual funds but platforms like Pocketful make this extremely simple for the investors as they can search for different gold mutual funds, complete their KYC digitally and start investing in different gold SIPs or even invest a lump sum amount. Pocketful gives a user-friendly interface to its users making investing in gold much easier.
By investing in these gold mutual funds investors don’t need to take on the headache of storing the gold safely. Here the fund house takes care of storing the gold in highly secured vaults; investments are stored in a digital format safely, making them safe from theft.
2. Diversified Portfolio
Gold mutual fund investments can help the investors in diversifying their portfolio. During the stress period, when the stock market might perform poorly, these gold investments can help in stabilizing one’s portfolio. This helps in protecting your overall portfolio during uncertain times.
3. Protection from Inflation and Market Volatility
It saves the investors from the inflation, as during inflation the price of commodities goes up and the value of money goes down. Gold has acted as an asset that has been guarded during inflation times. It is witnessed that when the currency depreciates during inflation, the price of gold rises helping the investor protect their wealth.
4. High Liquidity and Convenience
If you require cash instantly, selling the physical gold can be a challenge in terms of buyers, current price of the gold and even the making charges as you may not get the fair price. But buying these gold mutual funds can sell your units on any business day and get the money directly in your bank account within a few days. The process is transparent and hassle-free.
Factors to Consider Before Investing
Fund Performance History: Investors shall look for how funds have performed over the last 1, 3, and 5 years, as it helps in showing you how consistently it has tracked the price of gold. Though the previous performance doesn’t predict the future, it helps the investors in tracking the record of the fund.
Expense Ratio: Think of it as a service charge that is levied annually by the fund manager to manage your investments. A small difference in the expense ratio can affect the investor’s profit, so one should always look for the expense ratio and prefer a lower ratio.
Asset Under Management (AUM): This is a collective total amount that all the investors have put into the specified fund, here a large AUM shows the trust of investors. A good AUM also means that the fund has liquidity meaning you can easily buy or sell the units.
Tracking Error: This helps in telling the investors if the fund is working properly or not as this is used to track the performance of gold price in the actual market. Investors shall look for lower tracking error as this means that the return on your investment is very close to the actual gold returns.
Fund Manager’s Experience: While most gold funds are passively managed (they just follow the underlying ETF), it’s good to invest with a fund house that has a long history and trusted reputation in the industry. This adds a layer of reliability to your investment.
Investing in gold has changed for the better. You no longer need a large sum of money or a bank locker to own this precious metal. Gold mutual funds offer a simple, affordable, and smart way to add the stability of gold to your investment portfolio.
One should think of them as a long-term investment that protects your wealth, fights with rising inflation and brings diversification to your portfolio. You should be clear about the future goals that you want to meet and make the decision accordingly.
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What is the main difference between a Gold Fund and a Gold ETF?
To buy or invest in a gold ETF you need to have a Demat account but to invest in Gold Funds (which are funds of funds) you can directly do it from your bank account and there is no requirement for a Demat account.
Do Investors need a Demat account to start a Gold SIP?
No, to invest in Gold SIP you don’t require a demat account you can start a Gold SIP with just your bank account after completing your KYC.
How are Gold Mutual Funds taxed?
Gold mutual funds are taxed like non-equity or debt funds, if the units are sold within 3 years then the profit is added to your income and taxed according to your tax slab.
What is the minimum amount I can invest?
Most gold mutual funds allow you to start a SIP with as little as Rs.100 or Rs.500 per month, making gold investing accessible for everyone.
Shall I invest a lump sum amount or start a SIP in a Gold Fund?
SIP (Systematic Investment plan) helps in investing a fixed amount regularly whereas a lump sum is a one-time investment that you can consider if you have a large amount of money ready, so look according to the funds availability and your future goals.
There are multiple financial investments that you make as an investor, like stocks, mutual funds and some Fixed deposits in the bank. To keep a track of all these investments you have to use multiple platforms and different apps to look how your investments are doing which can sometimes be complicated or confusing for you to track your investments.
This is where the role of portfolio tracker comes in, it is a simple tool that puts all your investments in one place and tracks the price movements. With the right free investment tracking app in India, you can see your entire portfolio on a single screen, track price movements, monitor returns, and review allocation. It’s like having a report card for your money, so you always know where you stand.
What is a Portfolio Tracker?
It’s a simple app or website that consolidates all your investments in one place and gives you a clear picture of their performance—showing your portfolio’s total value and whether you are making a profit or a loss. The tracker works in two ways, first is the Manual Entry where every time you purchase or sell something you need to open the app and mention your buy and sell manually. Second is where this happens automatically where if you buy or sell something it automatically gets registered to your tracker. For this you need to link your broker account with the tracker app for shares and commodities but for mutual funds there is a special report called a Consolidated Account Statement (CAS). It’s like a single passbook for all your mutual funds, no matter where you bought them. You can let the tracker app read this report, and it will add all your funds to your screen automatically. This is a very useful feature, especially now that many people buy mutual funds from different apps to save money.
Pocketful is a new age platform designed for both active traders and long-term investors. It lets you track a wide range of investments, including stocks, ETFs, bonds, and even Futures & Options (F&O). For tax purposes, there are different reports that you can go through, as it gives you separate Profit & Loss reports for stocks, F&O, and commodities, making tax filing much simpler.
What’s really exciting about Pocketful is its focus on technology. It is soon launching a “Portfolio Analyzer” that will use AI to give you a detailed health report of your portfolio based on multiple different factors. For traders, it offers powerful tools like unlimited trading plans, extra payout, MTF at lowest rates, advanced order types, and free algo trading APIs.
2. INDmoney
INDmoney is a wholesome app that lets users track almost everything at one place. In this app you can look at your Indian stocks, US stocks, mutual funds, EPF, NPS, and even your credit card bills. This app gives you a single number for all your total investments (total net worth).
One of its most popular features is making it easy to invest in US stocks like Apple or Google, even with as little as $1.The app is also very helpful during tax season, as it can give you a consolidated tax report for your investments. It is one of the features that helps users in managing their financial life and making more informed decisions.
3. ET Money
ET Money is a fantastic choice if you are serious about your mutual fund investments. It has a special feature called the “Portfolio Health Check” where you can upload your mutual fund portfolio, and the app gives you a detailed report card for your investments. It also tells you how much money you have pooled in one industry and if your funds are at any risk, or if they are not performing well compared to others.
While it is great for mutual funds, it also helps you track other things like NPS and Fixed Deposits. ET Money has a paid service known as “Genius” that lets you use advanced tech to give you personalized investment advice based on one’s risk and preference.
4. Value Research
Value Research is one of the oldest names in the investment world and even trusted by so many users. Value Research’s portfolio tracker is suitable for investors who like to get the deep details and analysis of the desired stocks. The app has simple navigating functions and provides detailed high quality analysis of your stocks and mutual funds.
The platform also provides investment advice which helps you to decide whether to buy, hold, or sell a particular stock or fund. The platform also gives you detailed tax statements that can directly be filed. If you like data and are comfortable with technical analysis then this is a perfect research app for you.
5. MProfit
MProfit is a platform specially for investors that have different demat accounts with multiple brokers. The platform has the ability to automatically import your investment data from multiple brokers making it easy for you to analyse everything at one place, this automation helps in saving time and effort to enter everything manually, the app automatically fetches data for your broker and provides the analytics.
MProfit can keep a track of multiple types of investments like stocks, mutual funds, F&O, and even PMS and AIFs. MProfit is also a favorite among Chartered Accountants because it generates capital gains reports in the exact format required for filing income tax returns. The platform’s customer support is even excellent and its collective management of multiple accounts is praised by the users.
6. Tickertape
Tickertape acts as a smart toolkit for the new age users as it can connect with most of the stockbroking platforms like Zerodha, Angel One, and Upstox, making it simpler for you to see all your stock holdings in one dashboard. Its unique analysis tools makes this platform special for the users as it has a “Diversification Score” that tells you if your portfolio is well-balanced or too concentrated in one area.
It also has a “Redflags” feature that warns you about potential risks attached to your stocks in your portfolio, such as companies with high promoter debt. Beyond tracking, it has a powerful stock screener with over multiple filters that helps users to find out new hot investment options.
7. Groww
Groww came into the Indian market as a simple investing platform for mutual funds and has gradually become one of the most popular investment apps in India, which offer stock investment as well. The platform has an in-built tracker that analyzes everything in the app itself so that you can get everything in one place. Groww has a clean, simple, and user-friendly design, which makes investing hassle free and not confusing, especially for beginners.
In this app you can import all your external mutual funds investments and then analyse them and similarly by using CAS option all your fund data gets to your Groww dashboard, giving you a complete picture in one place. It also provides the necessary Profit & Loss reports you need for tax filing.
8. Kuvera
Kuvera is a platform that not only focuses on your individual investments but investments of your families as well, as it gives you a feature called the “Family Account” that helps in managing investments of your spouse, children and parents all from one single place. This feature helps in overlooking the entire family’s financial health.
The app has some interesting features like goal based investing where you can set up your future goal like “child’s marriage” or “buying a house” and link your investments to them, which helps you stay on track. Kuvera also offers smart tools like “Tax Harvesting,” which helps you save on long-term capital gains tax, and “TradeSmart,” which helps you switch from regular to direct mutual funds efficiently.
9. Zerodha Coin
Coin is the mutual fund investment platform from Zerodha, India’s largest stockbroker. It is famous for making mutual fund investing incredibly simple and completely free of commissions. Since it offers only direct mutual funds, you can earn up to 1.5% extra returns every year compared to regular funds.
The app has a very clean user interface and there are no ads, no distracting notifications, just a straightforward platform to buy, sell, and track your mutual funds. You do need a Zerodha demat account to use it, but it allows you to hold both your stocks and mutual funds in one place. It also provides all the tax reports you need from its main ‘Console’ dashboard.
10. Scripbox
Scripbox is designed for people who find investing confusing and want a helping hand. Its main goal is to help investors or beginners with how to invest and where to invest their money. Scripbox gives its users a tailored list of recommended funds based on smart data based funds that have potential to grow.
This approach is often described by users as “low effort and high reward” because it makes it very easy to start investing in a disciplined way. The platform is also great for goal-based investing, with specific plans for long-term wealth building, tax saving, and even creating an emergency fund.
Key Indicators of Best Free Stock Portfolio Tracker in India
Company
Assets Covered
Auto-Sync
Key Analytics
Tax Reporting
Platforms
Best For
Pocketful
Stocks, ETFs, F&O, Bonds, SGBs
Brokerage Account
Yes (Tax P&L Desk)
iOS, Android, Web
Traders and tech-savvy investors
INDmoney
Stocks,MFs,US Stocks,EPF,etc
Broker Sync,Email Read
Net Worth, Global Tracking
Yes (P&L statement)
iOS, Android,Web
All-in-one financial view
ET Money
MFs, Stocks, NPS, FDs
MF Central (CAS)
Portfolio Health Score
Premium Feature
iOS, Android
Mutual fund investors
Value Research
Stocks, MFs, NPS, PPF, Bonds, etc.
MF Central (CAS)
VR’s Analysis, Quality Score
Yes (Detailed Tax Report)
iOS, Android,Web
In-depth portfolio analysis
MProfit
Stocks, MFs, F&O, Bonds, PMS, etc.
Broker Import (700+), CAS
XIRR, Asset Allocation
Yes (ITR Format)
iOS, Android, Web, Desktop
Multi-broker, serious investors
Tickertape
Stocks, MFs, ETFs, Gold
Broker Sync (Multiple)
Diversification Score, Redflags
Basic
iOS, Android,Web
Investors using multiple brokers
Groww
Stocks, MFs, Gold
MF Central (CAS)
Basic P&L, XIRR
Yes (P&L Statement)
iOS, Android, Web
Groww ecosyst
Kuvera
Stocks, MFs, US Stocks, FDs
Broker Sync, CAS
Goal Planning, XIRR
Yes (Capital Gains Report)
iOS, Android, Web
Goal-based & family investing
Zerodha Coin
MFs, NPS
N/A (Direct Platform)
XIRR, Portfolio Analytics
Yes (Comprehensive)
iOS, Android, Web
Zerodha users & DIY MF investors
Scripbox
Mutual Funds
N/A (Direct Platform)
Curated Recommendations
Yes
iOS, Android, Web
Beginners wanting guidance
Key Factors You Need To Look for in a Free Stock Portfolio Tracker
Tracks Everything: A good portfolio tracker app should track stocks, mutual funds, ETFs, Fixed Deposits (FDs), bonds, gold and more. The more it can track, the better you can see your full financial investment analysis.
Connects Automatically: A good tracking app should connect with your broker accounts or use your CAS report easily. This saves you from the manual task of mentioning everything by yourself in the tracking apps.
Report Card: The app should tell you the data and numbers along with what they mean. Look for a feature called XIRR, where you can get to know your real profit per year from your investments. Also, look for charts that show you how your money is split between different investments.
Taxation: A good tracker can create a Capital Gains report for you. This report shows the profit you made from stocks and mutual funds, which you need for your tax filing.
Simple to Use: The app options shall be easy to navigate without reading a big instruction book. It’s great if it has both a mobile app (to check on the go) and a website (to see more details).
Money Safety: You are trusting the app with your financial details. Make sure it uses strong, bank-level security and if it is registered with SEBI or not.
As an investor you need to figure out what you need or which features are mostly liked for your hassle free trading. If you are a beginner and mostly invest in mutual funds, an app like ET Money or Groww is a good place to start. If you have accounts with many different stockbrokers, a powerful app like MProfit or Tickertape will be very helpful. And if you are a trader or an investor who is excited about new technology like AI, then Pocketful is a reliable and affordable platform.
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Yes, the main features of all these apps are free. Some of them may have a paid version for special features, but you can track all your investments without paying anything.
Is it safe to connect my bank or broker account?
Good apps use very strong security, just like banks, to keep your information safe. They usually only have “read-only” access. This means they can see your investments, but they cannot buy or sell anything or move your money.
What is a CAS, and why do apps ask for it?
CAS means Consolidated Account Statement which is a single monthly report of all your mutual fund investments. Apps use this report to automatically add all your mutual funds to your dashboard.
Can these apps help with taxes?
Yes, many of these apps like MProfit, Value Research, INDmoney, and Pocketful can give you a Capital Gains report. This report has all the profit and loss details you need to fill out your tax forms, making a difficult job much easier.
Do I have to stop using my broker’s app (like Zerodha or Angel One)?
A portfolio tracker is a separate tool that just sits on top and gives you a combined view of all your investments in one place.
India’s economy has come a long way. Not too long ago, every penny we earned or spent abroad was tightly monitored. Foreign exchange was scarce, and the government wanted to make sure not a single rupee went to waste. That is where FERA (Foreign Exchange Regulation Act, 1973) came into existence, a law that controlled all dealings with foreign currency.
Fast forward to the 1990s – India opened up to the world, invited foreign investments, and embraced globalisation. Suddenly, FERA felt outdated and restrictive. So, in 1999, it was replaced with FEMA (Foreign Exchange Management Act), an updated version, a law that was much more flexible and friendly to businesses.
In this blog, let us break down what FERA and FEMA are, how they differ, and why this change was so important.
What is FERA
The Foreign Exchange Regulation Act (FERA) was passed in 1973, during a time when India was struggling with low foreign exchange reserves. The main idea was to control every bit of foreign currency coming in and going out of the country.
Here is what made FERA excel,
It was very strict; almost every transaction involving foreign exchange needed approval from the RBI.
Breaking the rules was considered a criminal offence, which meant you could even end up in jail.
It applied not only to Indians but also to foreign companies doing business here.
In short, FERA worked for a while when India was cautious and inward-looking. But once globalisation began, it started feeling like a barrier rather than a safety net.
What is FEMA
By the late 1990s, things had changed. India had stronger forex reserves, was trading actively with other countries, and needed foreign investment to grow. That is when FEMA (Foreign Exchange Management Act, 1999) came into the picture.
FEMA’s approach was completely different:
Instead of control, the focus shifted to management.
Violations were treated as civil offences, meaning fines, and not imprisonment
Rules became more business and investor-friendly.
The RBI still kept an eye on forex dealings, but the overall framework was much more relaxed and simple.
The shift from FERA to FEMA marks a big turning point in India’s economic story. FERA was created when the government kept a strong grip on foreign exchange. It made sense back then, but as India opened up to the world, those restrictions started holding us back.
FEMA, on the other hand, reflects a more confident and global India. Instead of controlling every transaction, it focuses on managing them efficiently and welcomes foreign trade & investment, from all around the world, while still keeping enough checks to ensure fairness and security.
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The stock market is usually the first thing that comes to mind when you think about investing. But let’s just be honest: not everyone prefers that much risk. Some people want safety and prefer steady returns. Bonds and debentures come into the picture at this point.
At first, they might seem the same because both of them involve borrowing money and paying interest. But if you look more closely, you will be able to see some major differences. You can choose the investment option that works best for you if you know how they work and what makes them different.
In this blog, we will discuss the basic difference between bonds and debentures to make your financial journey even easier.
What are Bonds?
A bond is a fixed-income financial instrument that represents a loan made by an investor to a borrower, typically a government, municipality, or corporation. The bond issuer agrees to pay back the principal amount on a specific maturity date, along with periodic interest payments (called coupon payments).
In simple terms, when a government or company needs funds, instead of taking a loan from a bank, they borrow money directly from the public through bonds. When you purchase a bond, you are essentially lending your money to the issuer. In return, they make two commitments:
They will pay you interest regularly, which is like a fee for using your money.
When the bond’s time period ends or it matures, they will give you back the initially invested money.
Features
1. Safe and steady – People think bonds are safer than stocks because the government backs them.
2. Fixed income – You already know how much interest you are going to receive and when you will get it.
3. Time-bound – Bonds have a specific date when they will mature, so your money will not remain stuck there forever.
4. Good for Conservative Investors – Bonds are a good choice for conservative investors who are unwilling to take high risk.
A debenture is a type of debt instrument issued by a company to raise capital from the public. It acknowledges a loan taken from investors, with a promise to pay fixed interest at regular intervals and return the principal amount on maturity.
Think about a business that needs money to grow. It can ask people like you and me to lend money instead of getting a loan from the bank. That is where debentures come in. When you buy a debenture, you are giving the company your money. The company will pay you regular interest in return and then give your money back after a specified amount of time.
Most debentures are not backed by real assets, which is different from bonds. You trust the company’s reputation and ability to pay. However, there are secured debentures, but they are rare.
Features
1. Unsecured – Debentures usually do not include assets as security. You are taking on more risk if the company shuts down.
2. Issued by Companies – Companies issue debentures, but governments issue bonds.
3. Fixed interest – You will get interest, which will usually be higher than the interest on bonds.
4. Convertible or Non-Convertible – Some debentures can be turned into equity shares of the company later, while others just pay you back.
Table of Difference
Basis
Bonds
Debentures
Definition
Think of bonds as you lending money to the government or a company, and they promise to pay you back with interest payments.
Debentures are also you lending money, but here you are trusting the company’s reputation and ability to pay.
Who issues them
Governments and companies both issue bonds.
Usually, companies issue debentures.
Security
Often backed by assets or the government.
Usually not backed by assets, just the company’s reputation.
Risk
Safer, less risky.
Riskier than bonds.
Returns
Steady, predictable income.
Higher interest than bonds (to make up for the extra risk).
Tenure
Ranges between 2 years to 40 years; usually around 20 years
Ranges from 90 days to 20 years; with most issues under 10 years
Conversion to Equity
Most bonds are non-convertible.
Debenture can be convertible or non convertible.
Best for
People who want safety and peace of mind with a fixed income.
Investors are willing to take a bit more risk for the chance of better returns.
Which one should you choose?
The choice ultimately depends on the type of investor you are. Bonds are most suitable for individuals seeking a steady income with minimal volatility. They offer a high degree of security, as they are generally backed by the government or secured by tangible assets, allowing investors greater peace of mind.
Debentures might be a better fit for you if you are willing to take a little more risk for the opportunity of better returns. You are trusting the company to pay you back, which is riskier but usually pays off more.
You do not always have to pick one over the other. A lot of investors keep both bonds and debentures. They use bonds for stability and debentures for higher returns.
In the end, bonds and debentures are not competitors; they are just different types of investments. Bonds are the safe and reliable type. They give you steady returns, minimal stress, and peace of mind. Debentures, on the other hand, are more fascinating because they come with more risk but also have the potential for bigger rewards.
So, which one should you choose? It entirely depends on what kind of investor you are. Bonds will be good if you want stability. Debentures can offer attractive return opportunities for investors who are prepared to accept a higher degree of risk. It is advised to consult a financial advisor before investing in bonds or debentures.
S.NO.
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Mainly, companies issue debentures to raise money.
Are bonds safer than debentures?
Yes, bonds are generally considered safer than debentures, as they are often backed by the government or secured against specific assets, which provides investors with greater protection.
Do bonds pay fixed interest?
Yes, many bonds pay fixed interest.
Can I lose money in debentures?
Yes, if the company that issued them defaults, since debentures are usually unsecured.
Have you ever thought about retirement savings for your future? With such a fast moving life paying bills, managing daily expenses, and trying to have a life can be interesting but saving for a future that seems so far away can feel like the last thing on your mind. It is very easy to say, “I’ll start saving later.”
But building your retirement fund can be an easy step as compared to complicated charts and big numbers, it is more about creating a future where you have freedom and peace of mind. It’s about ensuring that tomorrow you can live comfortably, without financial worries.
In this blog we will learn about future saving tips, how to increase retirement savings and even retirement savings strategies to show you how to maximize retirement savings without needing to be a financial expert.
The 10 Essential Tips for Your Retirement Journey
Tip 1: Power of Compounding
Compounding is like making your money work for you and your money starts to earn its own money, this is the most powerful force for growing your money. The returns you earn start earning returns themselves, and over time, this creates a snowball effect that can dramatically grow your savings.
The most important thing is that you need time for compounding to work for you, due to this you need to start putting money in the early stages. This can easily be started by putting aside a small amount each month, starting in your 20s or 30s and giving your money decades to grow on its own. It’s the simplest way to build wealth without putting yourself under huge pressure to save massive amounts later in life.
Tip 2: Know Your Goal
Saving without a goal is like driving without a destination. Instead of aiming for vague targets or huge numbers, a good starting point is the “Rule of 25.”
Your Target Retirement Fund = Your Current Annual Expenses x 25
This isn’t about hoarding cash; it’s about building a fund that can pay you an income forever. The idea is that you can live off the earnings your fund generates each year, without ever touching the main amount.
Also, remember that the price of things goes up over time also termed as inflation, for example the cost of a cup of chai or a movie ticket is much higher today than it was ten years ago. Your savings need to grow faster than this rise in prices, just to afford the same lifestyle you have today.
Tip 3: Pay Yourself First
Most of us try to save whatever is left at the end of the month, which generally comes to nothing. Now let’s use a different rule where you “Pay Yourself First” at the start of the month itself, this sets aside your savings at the starting itself.
Consider your future self as your most important bill, the day your salary comes in, before you pay for anything else, transfer a set amount (even 10-15% is a great start) to your savings or investment account.
The best way to do this is to set up an automatic transfer for the first of every month, by this way, your future is taken care of without you needing willpower or discipline and you’ll naturally adjust to living on the rest.
Tip 4: Employee Provident Fund (EPF)
If you’re a salaried employee, you have a powerful savings partner with you which is your employer. Through the Employees’ Provident Fund (EPF), a portion of your salary is saved automatically, and your employer contributes to it as well. Your employer’s contribution is added to the small amount that is deducted from your part, collectively both you and your employer contribute to this future savings type.
But here’s a suggestion, don’t assume your EPF will be enough on its own for your future. Think of it as a fantastic head start, a solid foundation for your retirement. Your job is to build on top of it to create a truly secure future.
Tip 5: A Balanced Investment
You might have heard of this “don’t put all your eggs in one basket.” In investing, this is called diversification, where you diversify your investments in such a way that if one of them turns negative then at least the other saves you.
A Stable Investment: These are your safe investments like EPF, Public Provident Fund (PPF), and Fixed Deposits. They provide stability and predictable returns.
The Growth Engine: This is your equity, like stocks and mutual funds. They can be a bit up-and-down in the short term, but over many years, they have the best potential to grow your money and beat inflation.
Tip 6: Government Initiatives
The government of India has special initiatives for long term tax free savings, these initiatives help you to save for your future with good returns. The two most popular are the Public Provident Fund (PPF) and the National Pension System (NPS).
Public Provident Fund (PPF)
It is a savings account that is very safe as it is backed by the government. It is best suitable for people who don’t want to take any risk. The feature of PPF are as follows:
Guaranteed Return: It offers the investors a guaranteed return (currently 7.1%).
Tax-Free Earnings: The best part of this investment is that the interest you earn, and the final amount you get are all completely tax-free.
National Pension System (NPS)
NPS is a special retirement account that invests your money in the market, so it has the potential to earn higher returns with time.
Higher Growth Potential: Though the returns are not guaranteed in this but mapping the future tells us that it has positive results. You can choose a mix of safe and growth-oriented investments.
Extra Tax Savings: NPS gives you a special extra tax deduction of Rs.50,000, which is a bonus you don’t get with most other options.
Tip 7: Systematic Investment Plan (SIP)
SIP is one of the simplest ways to invest for your future, in this you don’t need a financial expert to guide you throughout. SIP works as an automatic payment plan for your investment where you can fix a small amount that can be deducted on a monthly basis and gets directly invested from your bank account to the financial market.
You can set up a fixed amount at once, this amount directly gets out of your bank account on a set date and gets invested for the future. This autopilot approach helps investors in building discipline and investing consistently, which turns out to be helpful for the future expenses. SIP can turn out to be the smartest way to build wealth over a long run keeping your future secure and stable.
Tip 8: Systematic Increases
While we talk about the future we should also consider that today we need to invest so that tomorrow we can get. So a simple trick is to increase your savings with increased income. Let’s say if there is any salary hike you should also consider increasing your investments. Here’s a simple trick that can have a massive impact on your final retirement fund. Every time you get a salary hike, give your investments a small hike too.
If you have a monthly SIP of Rs.10,000, maybe you can consider increasing it to Rs11,000 next year once you get a raise. It’s a small change you probably won’t even feel in your monthly budget. But over 20 or 30 years, these small annual increases can add lakhs, or even crores, to your final amount. It’s a simple way to make sure you’re saving more as you earn more.
Tip 9: Safeguarding via Insurance
Insurance will not turn out to be an investment for you but it will protect your savings, as your future comes with multiple risks, one of the risks is a health emergency. This is what insurance is for. Insurance keeps your healthcare expenses and many other expenses under control resulting in minimal effects on your savings. Like this there are many types of insurance but the two main types that shall be considered are:
Health Insurance: A single hospital visit can wipe out years of savings. Health insurance is there to pay those big bills so your retirement fund stays safe.
Term Life Insurance: This insurance plays a protective role for your family as if something were to happen to you, this insurance pays out a large sum of money to your loved ones so they can be financially stable. A good amount to aim for is a cover of at least 10-15 times your yearly income.
Tip 10: Emergency Fund
These days life is unpredictable for all of us, a sudden job loss, a family emergency, or an urgent car repair can happen to anyone. So you should also have an emergency fund as a safety cushion for such moments as you grow in life.
This is a separate budgeted money, generally 4 to 6 months of your monthly essential living expenses that can only be touched in harsh emergency situations.
It is suggested that you should keep this money safe and separately to a place that can only be opted out during sudden emergencies. It is advised to have a separate savings account or a fixed deposit that can be easily liquidated.
Planning for retirement isn’t as hard as we think, it is just about making a plan and climbing the stairs step by step with consistency. You cannot suddenly start saving for your future, rather it is a time taking step that needs to be started as soon as you realise the real need.
Your future planning does not require a financial expert to create a plan. It is as simple as saving from your monthly budget but you need to start early, be disciplined by automating your savings, and protecting your future.
S.NO.
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The best time has already started, every passing day is giving you less savings. The earlier you start, the more time your money has to grow through compounding.
How much money shall I save from my salary to save for my retirement?
One should at least make an aim to save 15% to 20% of their salary or income, at the beginning you can also start with saving just 10% of it.
Will my EPF cover the requirements of my future?
EPF can be a great foundation for your retirement but with rising costs and inflation you should also invest in mutual funds SIPs, PPF or NPS to build a stable fund for hassle free retirement.
Difference between PPF and NPS?
PPF is a guaranteed return investment that comes with great savings, also it is tax free on the other hand NPS is linked to the market, so it has the potential for higher returns but also comes with more risk.
Should I keep my Emergency fund separately?
A separate savings account or a Fixed Deposit (FD) are excellent choices for keeping your emergency funds. The main goal of an emergency fund is to have quick access to your savings for any crisis and not to earn high returns on it.
In the financial market there are various terminologies but you might have also come to words like algorithmic trading, or algo trading. Here the basic thing is trading is done by using computer programs to automatically buy and sell stocks in the share market. Instead of you clicking the buttons, a pre-written code does it for you based on a set of rules.
With the advancement in technology algorithmic trading is very popular in India, but it raises some big questions. Is it a reliable way to make money? Is it even legal for a regular person to use? Many people are asking, is algo trading profitable? They want to know if algo trading is legal in india and if algo trading is profitable in india. These are important questions, especially when considering if trading is profitable in India overall.
In this blog we will understand how algo trading works and its features and its legality in the financial trading world.
What is Algorithmic Trading?
In Algo trading the trading is done using a computer program to place buy and sell orders in the stock market. This program follows a pre-defined set of instructions, or an algorithm, that you create. The users or investors need to set the Price of the stock and Buy a stock if its price crosses its 50-day average and Sell a stock at 3:15 PM every day. And investors need to buy a stock if its trading volume doubles in an hour.
Here you need to create the strategy and on the users behalf the computer just does the work.
The investors need to be clear about the stocks they want to invest in and provide step by step instructions, the rules for buying and selling. The algorithm is like an automated robot where you can instruct and see the magic happening on its own.
First you need to watch a stock of the selected company, if there is rise of 1% or 2% in price then as per instructions you can buy and if it starts to fall then you sell it also if you start to face the losses on the assets you have bought then you can sell to limit down your losses. The computer monitors the market every second and executes these orders instantly when these conditions are met.
The difference between trading yourself and using an algorithm is vast:
Manual Trading: In this type of trading you monitor the screen, do the research, take your decisions and make your own decisions, here decisions can sometimes be emotional or outdated.
Algo Trading: In this type of trading computer program executes the trade and the decisions are based on pre-set rules and analysed available data. Here, possibility of human error and emotions can be wiped out and you can have well informed decisions for your future trades.
Is Algorithmic Trading Legal in India?
Here comes the most critical question if algorithmic trading is legal or not and the answer is yes, algorithmic trading is completely legal for retail investors in India. However, it’s not a free-for-all. SEBI being the market regulator has a strong framework to protect the interest of investors and make the market a stable and fair place for everyone.
SEBI’s main job is to make the financial market a safe place for the investors and with algo trading the risks are higher due to the speed and automation of the process. A fault in the algorithm can sometimes place a wrong order in a fraction of seconds that can even lead to heavy losses. The rules are designed to present this and protect the traders from fraud and manipulation.
SEBI’s New Rules (Effective August 2025)
SEBI has introduced a new set of rules to make algo trading safer for retail investors. You need to look upon the following points:
Inter-connected Platforms: You cannot connect your trading software directly to the stock exchange (like NSE or BSE). Every single order from your algorithm must pass through your stockbroker’s systems. The broker acts as a checkpoint, ensuring every order is legitimate before it hits the market.
Mandatory Approvals: The strategies used shall always be approved by the stock exchange, this is done to make sure the strategy does not manipulate the financial market.
Unique Algo ID: Unique IDs are provided to all the algo traders which helps SEBI track all automated orders and investigate if something goes wrong.
“White Box” vs. “Black Box”: SEBI has classified algos into two types, first is the White Box where trading is done in a simple and transparent way and second is the Black Box where the trading logic is secret or very complex. Anyone selling a “black box” strategy must be registered with SEBI as a Research Analyst, which adds a layer of accountability.
No More Open APIs: To enhance security, SEBI has banned open APIs. You will need to use a secure connection with measures like a static IP address, which your broker will help you set up.
Is Algorithm Trading Profitable?
Simple Strategy: Don’t overcomplicate things as many beginners believe a strategy with a dozen indicators is smarter but in algo trading the opposite is often true. Simple, clear rules are easier to test and tend to work better when the market changes unexpectedly. A complex strategy might just be good at explaining the past, not predicting the future.
Test Realistically: Looking at how your strategy performed on past data (backtesting) is a must. Your backtest might show a profit, but once you add brokerage, taxes, and slippage (the small price difference when you actually buy or sell), that profit can shrink or even disappear. These costs can cut your returns significantly, so always include them in your tests.
Don’t Over-Optimize: It’s easy to keep changing your strategy’s rules until it looks like a perfect money-making machine on past data. This is a huge trap called “over-optimization”. You tend to look at market views, expert guidelines and various podcasts but the live market is always different, and such a strategy will likely fail. A good strategy should work reasonably well on different sets of past data, not just one perfect scenario.
Manage Your Risk Strictly: Your first job isn’t to make profits; it’s to avoid big losses. This means using stop-losses to cut a losing trade short and deciding beforehand how much money you’ll risk on each trade. One bad trade should never be able to blow up your account. Poor risk management is the fastest way to lose money.
Count All the Costs: A strategy might seem profitable on paper, but costs are real. You have to subtract brokerage, taxes (like STT and GST), platform fees, and API charges. For strategies that trade many times a day, these small costs can add up and turn a winning strategy into a losing one.
Always Keep an Eye on It: Algo trading is not a “set it and forget it” system. The market changes, what works in a rising market might get crushed in a flat one. You need to watch how your algorithm is performing and be ready to step in or turn it off, especially when the market goes crazy or if there’s a technical problem.
API and Platform Fees: Some brokers offer free APIs to its users while some charge monthly fees and some no-code platforms have different subscription plans.
Infrastructure Costs: Advanced traders use Virtual Private Server (VPS) to run their algorithms 24/7. This is a small monthly cost but ensures your system is always online.
Transaction Costs: Traders are bound to pay the basic trading charges like brokerage, Securities Transaction Tax (STT), exchange charges, etc. For frequent traders these costs can add up and consume your profits significantly.
The Advantages of Algorithmic Trading
Lightning Speed: By using algo trading traders can execute trades within milliseconds and can even capture even the small price movements that can be tough for humans to react instantly.
Flawless Accuracy: Algo trading can reduce human errors making trading experience more accurate and error free.
Rigorous Backtesting: Algo trading can help you with multiple years of data and its quick analysis for your next trading move.
Emotion-Free Discipline: This is one of the biggest advantages of Algo trading, as per SEBI over 90% of the retail traders make losses in their trades due to improper study and emotional decisions. Algorithms derive the decisions from data and its in depth analysis.
The Disadvantages of Algorithmic Trading
Added up Costs: Users have to pay multiple fees like API fees, platform subscriptions and basic transaction charges as adding all this up can directly hit your profits.
Technological Faults: There can be an internet issue or what if there is a bug in your code or the broker’s API has an outage during the crucial market hours, these types of technical failures can be risky.
Dependency: A smart trader uses a mix of both, their skill set and a good strategy but totally relying on the technology without a certain skill set can turn out to be negative for your financial future.
Over-Optimization: This is one of the mistakes that traders make as optimization uses data that is based on past data which can give you a result that can perform negatively in the live markets.
Algorithmic trading helps traders with a powerful trade that can give them an edge in the market, but always remember it is just a tool that cannot give you guaranteed profits and has both advantages and disadvantages. A strategy which is bad and then automated can give you a result that brings you closer to the losses.
If you are looking for success in algo trading you need to have a solid, well tested strategy, a disciplined risk management approach and continuous knowledge addition is the best way to sail through algo trading. Algo trading helps traders with a structured and emotion free path for your financial decisions.
S.NO.
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Is Algo trading suitable for small individual investors?
Yes, the new SEBI framework is designed to make algo trading safer for retail investors. You just need to use the official API provided by your stockbroker and follow the rules.
Do I need to be a coding expert to start algo trading?
Not exactly, coding gives you the most power and flexibility, there are many excellent no-code platforms that allow you to build, test, and deploy strategies using a simple drag-and-drop interface.
Can I start with a small investment?
You can start with a small investment as there is no fixed cost to start. However, as a trader you need to account for your trading capital and other costs like API or platform fees. As a smart investor you should always start with a small amount that you can lose.
Is it true that algo trading guarantees profits and has no risk?
This is one of the prominent myths in the market, it does not guarantee profits. Your risk comes from your strategy, market volatility, and potential technology failures.
What is the single biggest mistake a beginner can make in algo trading?
The biggest mistake is blindly trusting a strategy without doing your own homework. This includes using an unverified “black box” algorithm that promises unrealistic returns or deploying a strategy that you have over-optimized on past data without understanding its risks in a live market.
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