Glossary
At Khushiyan Wealth Partners, we believe in empowering our clients with knowledge and understanding of financial concepts. This glossary is designed to provide clear definitions of commonly used terms in the world of finance. Whether you're new to financial planning or seeking to deepen your understanding, we hope this resource proves helpful on your journey towards financial well-being.
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SIP (Systematic Investment Plan)
A method of investing a fixed sum regularly in mutual funds to benefit from rupee cost averaging and potentially higher returns over the long term.
PPF (Public Provident Fund)
A long-term investment scheme offered by the Government of India with tax benefits. It offers a fixed rate of interest and has a maturity period of 15 years.
PAN (Permanent Account Number)
A unique 10-character alphanumeric identifier issued by the Income Tax Department to individuals and entities. It is essential for various financial transactions and tax purposes.
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EMI (Equated Monthly Installment)
A fixed payment amount made by a borrower to a lender at a specified date each calendar month. EMIs are used to repay both interest and principal over a predetermined period.
Inflation
The rate at which the general level of prices for goods and services is rising, leading to a decrease in purchasing power over time.
ELSS (Equity Linked Savings Scheme)
Mutual funds that offer tax benefits under Section 80C of the Income Tax Act. They primarily invest in equity markets and have a lock-in period of three years.
ULIP (Unit Linked Insurance Plan)
A hybrid financial product that offers both investment and insurance cover. Part of the premium is invested in funds of the policyholder's choice, while the rest provides life insurance coverage.
KYC (Know Your Customer)
A process by which financial institutions verify the identity and address of their customers. It is mandatory for opening bank accounts, investing in mutual funds, etc.
Nifty and Sensex
Nifty is the benchmark index of the National Stock Exchange (NSE), comprising 50 actively traded Indian companies.
Sensex is the benchmark index of the Bombay Stock Exchange (BSE), comprising 30 actively traded stocks.
Asset Allocation
The strategy of dividing a portfolio's assets among different asset classes (such as stocks, bonds, and cash) to manage risk and achieve investment goals.
NPS (National Pension System)
A voluntary contribution retirement savings scheme launched by the Government of India, open to all citizens. It offers tax benefits and aims to provide regular income post-retirement.
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GST (Goods and Services Tax)
A unified indirect tax levied on the supply of goods and services in India. It has replaced many indirect taxes imposed by the central and state governments.
FD (Fixed Deposit)
A unified indirect tax levied on the supply of goods and services in India. It has replaced many indirect taxes imposed by the central and state governments.
Demat Account
An account that holds shares and securities in electronic form, eliminating the need for physical share certificates. It's necessary for trading and investing in the stock market.
Power of Attorney (POA)
A legal document that allows an individual to appoint another person to act on their behalf, especially in financial matters.