Hey folks!

Hello and welcome to your weekly update on investments, personal finance, cryptocurrencies, and more. Today, we will talk about mutual funds as a tax-saving investment alternative, discuss the impact of compound interest on your investments, report on crypto markets, recommend an interesting finance book that draws investment insights from Darwin’s evolutionary biology, and end the day with a fun-loving crypto crossword.

Strap your seat belts as you embark on a power-packed reading experience.

There is a lot more to mutual fund investments than SIPs. We bring to you a video that deep dives into Systematic Withdrawal Plan (SWP) in mutual fund investments. SWP is a tax-saving investment alternative that can help you maximize your returns while minimizing taxes. Watch the video to learn more about strategically withdrawing your investments, optimizing tax implications, and securing your financial future.

Moving on, let's understand how compound interest works its magic on your investments.

Compound interest makes your money grow faster because interest is calculated on the accumulated interest as well as your original investment amount. It creates a snowball effect as the original investments and the income earned grow together.

Therefore, while there is no set limit to start investment, the earlier you start, the better it will be for you. Starting with savings early in life and saving systematically will put the power of compounding in your favor by making your money work for you.

Let’s understand the impact of starting early on your investment with an example.

Ram and Shyam are of the same age. When Ram was 25 years old, he invested Rs. 50,000 at 8% per annum, compounded annually. By the time Ram is 50 years old, his invested money will grow to Rs. 3,42,424. He will earn a whopping Rs. 2,92,424 interest on his initial investment of just Rs. 50,000.

On the other hand, Shyam did not start investing until he was 35 years old. At 35, he invested Rs. 50,000 at 8% per annum, compounded annually. When he turns 50, he would have accumulated Rs. 1,58,608. Of the maturity amount, Rs. 1,08,608 would be the interest.

We can understand the power of compounding from the above example. The compounding impact on investments makes the financial decision of saving before spending worth the hard work and the forgone Nike Jordan.

Next week, we will discuss the rule of 72 and how it can help you calculate the duration in which you can double your investments. Stay tuned.

Crypto markets showed tremendous resilience in a week full of negative news as they traded sideways with an upward bias. The global crypto market cap is back above the $1.1 trillion level, as BTC outperformed ETH slightly, trading higher than $26.5k, while the latter also continues to trade above $1.6k.

Even as institutional adoption continues to gain steam, with Deutsche Bank being the latest TradFi giant offering direct crypto custody for its clients and South Asian super app Grab partnering with Circle for USDC payments.

There was a slew of negative news developments in the market that kept investors on the edge. The biggest overhang was the decision of the court presiding over the FTX bankruptcy to allow for the liquidation of its multi-billion dollar assets, which sent shockwaves around broader markets. Solana's SOL was the largest holding but has a relatively less aggressive rate for the liquidations, compared to some other altcoins.

The other big risk was emerging from the exodus of senior leadership at Binance US, hinting at some upcoming regulatory action. It started with their CEO and was followed by the Legal and Risk heads.

While the broader crypto markets remained range bound there was much token-specific activity driving outlier price actions.
The FTX Liquidation news was the primary driver for bringing sell pressure on SOL, even though the court order stipulates a weekly sale limit, which SOL Trading volume can easily absorb. The token price rebounded strongly later in the week.
However, the same can't be said for other FTX portfolio tokens like TRX, MATIC, and DOGE which fell in price as their relative liquidations per week would have a significant impact based on weekly trading volumes.

• SOL $19.13 ⏫ 5.14%

• TRX $0.08394 ⏫ 6.84%

• MATIC $0.523 ⏫ 0.56%

• DOGE $0.06183 ⏬ 0.07%

(All data here is as of 1.30 pm, 18 September 2023.)

As a crypto enthusiast, you should understand what’s causing all the price action. So here’s some news to help you digest the market’s ups and downs.

• Telegram has endorsed the TON network as its blockchain of choice for Web3 infrastructure and will integrate it into the app’s user interface. Toncoin, the blockchain’s native token, surged after the news, adding 6.5% in 30 minutes. Read more here.

• Franklin Templeton filed for a spot bitcoin exchange-traded fund (ETF) on 12 September, becoming the latest traditional asset management firm to join the crowded field. Read more here.

• Binance.US has been accused of not cooperating in a probe by the Securities and Exchange Commission, which has said the company’s staking, clearing, and brokerage services violate federal securities law, in court filings unsealed Thursday. Read more here.

Making your money grow and growing trees have a lot in common. No, don’t take our word for it, this nugget of wisdom is from Pulak Prasad, the founder of Nalanda Capital. Today’s book recommendation is an unusual yet refreshing crossover between investing and Darwin’s evolutionary biology theory.

What I Learned About Investing from Darwin

By: Pulak Prasad 

Who would have thought evolutionary biology could also apply to the evolution of your portfolio? Reading this book makes it abundantly clear that they are related. Prasad makes a strong case for patient long-term investing based on an unexpected source: evolutionary biology. In the book, he draws key lessons from core Darwinian concepts, mixing vivid examples from the natural world with compelling stories of good and bad investing decisions—including his own.
Prasad offers three mantras for investing: Avoid big risks; buy high quality at a fair price; and don’t be lazy—be very lazy. He supports his investment philosophy by basing it on evolutionary biology.

Read the book for your portfolio to evolve. While this book is primarily meant for fund managers, individual investors can benefit from the wisdom and theories highlighted in the book.

Before you get on with your day, don’t forget to flex those brain muscles with our weekly crypto crossword

Answers to the crypto crossword#14

1. Robinhood

2. MakerDAO

3. Ethereum

4. SOL

5. ReFi

6. ADA

7. Lamport

8. NEO

9. Reserves

10. Graph

11. Scamcoin

12. Skynet

That’s it for now. Thanks for sticking around.

See you later, folks! 👋

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