Risk Management – What is Risk Management & its Process

Posted by Mehul Kothari | Published on 21 Nov 2019
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Risk Management – What is Risk Management & its Process

Risk management is the process of identifying risks, analyzing them and taking adequate measures to curb these risks to achieve the desired results. The term financial risk management is most often associated with businesses; it is equally important and applicable to your investment portfolio.

Risk management process in financial investments comprises of determining the risks that exist for the particular investment and implementing strategies to mitigate the risk in the way. Risk management is an important aspect of investing as it helps reduce the risk depending on your individual goals.   

Whenever you make investments, you try to look at the potential returns from the investment. However, just like the returns, there is also a degree of risk attached to the investment. Your choice of investment will depend upon your financial requirements and the level of risk you are willing to take for your investments.


Types of risk management

Longevity Risk

People today are living healthier and longer, thanks to the rapid advancements in the medical world. However, living longer also means that you need to plan your investments for a longer retirement. This risk of outliving your money is known as longevity risk.

You need to take adequate measures to limit this risk. Some of the ways to can mitigate this risk are by investing for retirement corpus from an early age; keeping a high savings rate in working years, look out for second employment post-retirement, etc.


Inflation Risk

Inflation is a constant increase in the cost of goods and services in the country. Inflation reduces the purchasing power of money and higher inflation means we can buy fewer things in the future as compared to the past or present for the same amount.

As an investor, you need to select assets and implement investment strategies that have potentially higher returns much above the rate of inflation. When you are investing in fixed income instruments such as a Bank FD, Corporate bonds, etc. always be watchful that the return on investment is above the inflation rate.


Interest Rate Risk

Change in the interest rate can affect your portfolio. When the rate of interest is high, there is a decrease in the value of corporate bonds. A higher interest rate can have impact on an industry or a sector, which in turn could affect your equity investments if they are impacted negatively by the increased rates.

Diversifying your investments in different asset classes, choosing debt investments of varying maturity can help you limit the risk associated with the changing interest rate.


Liquidity Risk

Many people associate liquidity risk with just real estate investments. Undoubtedly real estate is one of the most illiquid assets, but many other investments to have a lock-in period and pre-mature withdrawal attracts a penalty.

To protect yourself from liquidity risk, it is important that you have an emergency fund in place and also limit your exposure in assets which are difficult to liquidate or involve incurring expenses.


Market Risk

Market risk is the risk associated with the decline in the value of your investments due to economic or other developments, which affect the entire market. Market risks are unavoidable when you make any investment, however, you can lower the impact on your investments through adequate measures.

As an investor, have a well-diversified portfolio in different asset classes such as equity, debt, gold, etc. as not all the assets would not be affected in the same way or magnitude in any development. Moreover, you can reduce the risk of wanting to time the market by buying stocks at different times to average out the cost of your investments.


Credit Risk

Credit risk applies to debt investments such as bonds and corporate FDs. It is the risk of the inability of the issuing entity to repay the interest and/or interest on maturity.

 As an investor, you can mitigate credit risk by looking at the credit ratings of the issuer. Higher the rating, the lower is the risk. AAA bonds have the lowest credit risk.

 

Risk management process to mitigate the various types of investment risk in your portfolio

  • Goal setting and investing as per your requirement

Investments are made keeping in mind your individual goals and needs, your time frame of investment and your tolerance to risk. Once you are clear about all these things, you can allocate your savings in assets which would help you achieve your goals in the desired time frame.  It is important to remember that long-term investments in growth assets may be volatile in the short-run and you should not make any hasty decisions.

  • Portfolio Diversification

Diversification is the process of distributing the investments in your portfolio in different asset classes. Diversifying your investments in different assets such as stocks, bonds, commodities, gold, etc. helps reduce the overall risk of your portfolio as the performance of all the assets is not correlated and in a given economic condition the performance of the asset classes will not be same. Diversification is one of the most crucial risk management techniques for you to mitigate the risk of your investment portfolio as it helps you to take advantage of the different price movements of different assets.

  • Regularly monitor your investments

Depending on the performance of various asset classes in your portfolio, their percentage holding in your portfolio may change from the original allocation. Thus, monitoring your portfolio regularly and rebalancing would ensure that your portfolio remains well-diversified.

  • Take financial advice from experts

Financial planning and risk mitigation of your portfolio requires knowledge, time and expertise. Taking the help of financial experts, who can guide you to select the right financial products as your risk profile and unique investment needs.


Conclusion

A disciplined approach to your investments and sticking to the basic principles of risk management will help you achieve your financial goals. If you are unsure on how to manage risk of associated with your investments and need guidance to help you prepare a portfolio most suited to your investment needs and minimising risk, you can consult our financial advisors at IndiaNivesh who can help guide you through your investments and also manage your portfolio risk. 





Disclaimer: "Investment in securities market and Mutual Funds are subject to market risks, read all the related documents carefully before investing."

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Know What is Pre-Market Trading & How it Works in Share Market

Posted by Mehul Kothari | Published on 21 Nov 2019

Most of us are aware that trading takes place on the stock exchange between 9.15am and 3.30pm. But what if we told you that it is only partially correct. Some trading (though low in volume) also takes place during the extended trading hour periods. Read on to know about more about this additional trading window and its significance. What is Pre-Market Trading Pre-market Trading is a global phenomenon and refers to trading that takes place before the usual trading hours. The usual trading hours for Indian stock markets is 9:15 am to 3:30 pm. Pre-open market stock trading is a special trading window of 15 minutes prior to the start of the working hours for the stock markets. Hence, the time frame between 9:00 am and 9:15 am is considered as the pre-open market session. This feature was first introduced by NSE and BSE in October 2010. The objective behind a pre-market trading It was observed that there was tremendous volatility in the first couple of minutes of trading hours. The core objective behind having a pre-market trading session is to stabilise the market especially when heavy volatility is expected due to some overnight major events or corporate announcements. These could be election results, reforms or new economic policies, declaration of mergers and acquisitions, delisting of shares, open offers, change (especially downgrading) in credit ratings, debt-restructuring, market rumours etc. The additional 15 minutes allows the stock markets to arrive at the right premarket stock price and not get carried away by external events or announcements. In India, premarket future or options trading is not permitted. Pre-market Trading Session – Breakdown of the 15 minutes The premarket trading period can be further bifurcated into three slots:Order Entry or CollectionThe Order Entry session starts at 9:00 am and lasts for eight minutes. The following activities are undertaken during this timeframe Placing of orders for purchase or selling of stocks Changes or modification in orders Cancellation of orders After 9:08am (i.e. completion of order entry session), orders are not accepted by the stock markets Order MatchThe Order Matching session starts at 9:08am and continues for the next four minutes. The following activities are undertaken during this timeframe Confirmation of orders placed during the Order Entry session Order Matching Calculation of stock opening price for the regular session that starts at 9:15am During the Order Match session, one cannot buy, modify, cancel or sell their orders. Limit orders (i.e. order quantity and price is specified) are given priority over the market orders (order quantity and price are not specified) during the execution time. Buffer TimeThe last three minutes of the premarket trading session (i.e. 9:12 am to 9:15 am) is considered as buffer time. This period is used to ensure a seamless transition to regular trading hours. Any abnormalities from the previous two slots are addressed during this time.   Calculation of Opening price during the pre-market stock trading session The opening price of the stock during this session is determined during the second phase i.e. Order Match session. It is done with the help of a specific methodology. This calculation method is referred to as the call auction methodology or the equilibrium price. The stock price which corresponds to the maximum quantity of tradable shares is known as the equilibrium price. It is a factor of demand and supply. The orders placed during the first eight minutes are matched at the equilibrium price and then traded accordingly. Some scenarios: If the highest tradable quantity corresponds to two different stock prices, then the stock price with the lower unmatched orders is taken as the equilibrium price. For example:   Stock Price Order (Buy) Order (Sell) Demand Supply Max Tradable Quantity Size Unmatched Orders (Demand minus supply) 105 1275 1160 25000 20000 20000 5000 99 2000 8000 20000 30000 20000 -10000   Though the maximum tradable quantity is same in both the cases, the equilibrium price will be considered as 105 as it has a minimum unmatched order size If the values of the highest tradable quantity and unmatched orders are same or equidistant, but they correspond to two different stock price, then the above methodology cannot be applied. In this case, the equilibrium price is taken as the stock price which is closer in value to the closing price of the previous day. For example, Stock Price Order (Buy) Order (Sell) Demand Supply Max Tradable Quantity Size Unmatched Orders (Demand minus supply) 105 1275 1160 25000 20000 20000 5000 99 2000 8000 20000 25000 20000 -5000 Assuming the closing price on the previous day was Rs. 110, then the equilibrium price in the above example will be Rs. 105.   What about orders that remain unmatched or are not traded in the pre-open session? Orders that are not traded or remain unmatched are carried forward to the general trading session. The opening price of these orders is determined in the following manner: Limit Orders i.e. orders wherein the price and quantity are already specified are carried forward at the same mentioned price Market Orders i.e. orders wherein the price and quantity are not specified are carried forward at: If the opening price was ascertained during the pre-open trading session but order not traded, then at the determined price If the opening price was not discovered, then they are carried forward at the previous day’s closing price   Stock Markets tend to be overwhelming for many investors. The concept of premarket trading can further compound the complexity level. However, as an investor, you should always remember that help is just around the corner. Professional experts like IndiaNivesh can help to simplify and demystify the entire process. The team at IndiaNivesh keeps a close eye on this Pre-market session to comprehend the mood and strength of the stock market. They track the pre-market stock prices and take the best decisions for your portfolio basis the market sentiments. Moreover, since they offer a wide range of services (broking, mutual funds, institutional equities, private equity, strategic investments, corporate advisory, etc.) they have a holistic view of the market and the economy. Their expert opinion can help you to amp up your investment game. You can read more about their offerings, vision and accomplishments on their website https://www.indianivesh.in/Disclaimer: "Investment in securities market and Mutual Funds are subject to market risks, read all the related documents carefully before investing."

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Online Trading – 5 Essential Tips for Trading Online in 2020

Posted by Mehul Kothari | Published on 14 Jan 2020

Technological advancements and digitalisation have changed the online arena for every business, and the online share trading is no exception to the trend. Over the last few years, online trading has become very popular, especially amongst the millennials and generation Y. Prevalence of smartphones, lower costs, opportunity to earn extra income, low entry barriers, ease of access, etc has had a profound impact on online trading. Even though online stock trading today is huge, and many people are motivated to explore online trading for a rewarding career, by no figment of imagination it should be assumed that it is easy, and they can become financially self-sufficient in a short period. Here are 5 essential online trading tips to help improve your chances of success in your endeavours as a trader-1. Do the research and gain relevant information about the markets The economic conditions are constantly changing and it has a significant impact on the stock markets. To be successful in online share trading you have to do your research, collect relevant information and be updated about matters relating to markets. With information being available at the click of a button, it is easy to get access to information from various sources. Keeping your eyes and ears open about the official announcements being made, reading up market-related articles and financial publications can help you ace the game of online stock trading and avoid making whimsical trade calls.  2. Get acquainted with the trading terminologies and tools Getting yourself familiar with various terminologies and trading tools beforehand is extremely important so that you do not falter when you start trading. Clearing your basics about the important workings, different types of trades, important terms are critical. If you are not clear about the basics, then you may end up placing a wrong order. Once you are trading online, you are investing real capital and you cannot undo the trade. So, it is essential that you must be familiar with the features and the functions of the trading platform which you are going to use. Practice trading on dummy versions to get a hang of the trading interface before you can start with online trading. Once you have enough practice you will not be flustered and confused at the time of real trading. 3. Start with small capital and practice risk management There are infinite opportunities in the trading world and you do not want one experience to be the deciding factor for you. As online trading is risky, you should always make a small start in the beginning and invest little capital. Even the most successful traders do not put their entire investible surplus for trading but use only the capital which they have to spare after they have put aside for their long-term goals such as retirement. So, invest only the capital which you can afford to lose and which will not affect your financial planning. Another important thing to keep in mind at the time of executing trades is that the risk associated with trading is high and hence you should take adequate measures to minimise risk. Setting a stop-loss to your order will automatically stop a trade if the losses hit a particular mark and help minimise your losses. 4. Be patient and disciplined Online trading is a great way to make an income and many have successfully made a career out of it. If the success stories of other traders have motivated you to take the plunge, then, let’s be honest, online trading is risky and not for the light-hearted. Moreover, it is not something you can master overnight or become rich overnight on a single trade. To be successful, you need to have the right mindset and should be disciplined in your approach. Make a trade plan and stick to it. Trading out of impulse or greed will not help you become successful but following a plan and trading when you see opportunities can help you achieve the desired results. 5. Select the right broker and trading platform Last but not least, choosing the right broker and opening the best trading account online is important, and hence you should be careful about your selection. Choose a trading platform that best meets your needs and has a user-friendly interface. You should be comfortable using their software. Your success rate would be greatly affected by the timely execution of your orders. Other aspects to consider are a level of customer service and satisfaction, market reputation and competitive fee structure.   Conclusion With the above essential online trading tips, you can give your income a boost. We at IndiaNivesh have one of the best online trading platforms at the most competitive price and also offer expert advisory and research to meet your investment needs.Disclaimer: "Investment in securities market and Mutual Funds are subject to market risks, read all the related documents carefully before investing."

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  • IPO Process - 5 Steps for Successful Listing in India
    Posted by Mehul Kothari | Published on 14 Jan 2020

    The last two years have proven to be very fruitful for the IPO (Initial Public Offer) market. Investors have cashed in the opportunity and made huge returns in the IPO. The journey of the company to offer its shares to the public is exciting and at the same time, it also offers an opportunity to the investors to reap the benefits of IPO. Seeing the performance of recent IPOs, the attention of investors towards it is at an all-time high and they are always on a lookout for the new opportunities to arrive. When a private company decides to go public, the initial public offering process starts. The companies go public to raise a huge amount of capital in the exchange of securities. An IPO is an important stage for the growth of any company because they have access to public capital which enhances their credibility and exposure. The initial public offering process in India is regulated by the ‘Securities and Exchange Board of India (SEBI). In this article, you will learn about 5 steps of the IPO process for a successful listing on the Indian stock exchange. IPO Process in India Step 1: Selection of an Investment Banker for Underwriting Process Before understanding the IPO process, let us understand what underwriting is. Underwriting is a process in which the shares of the companies are issued and sold during the initial public offering. During this process investment bank advices and gives suggestions to the company against a fee. The investment banker understands the financial situation of the company and accordingly suggests them plans to meet their financial needs. They sign an underwriting agreement with the company. The agreement has all the details about the deal and the amount that will be raised by issuing securities. The companies may select an investment bank after determining various factors such as the reputation of the bank, expertise in the process, quality of their equity research and experience in the sector they deal. All these factors help in selling the IPO to the investors, traders and retailers. Step 2: Due Diligence and Regulation Process After the selection of the investment banker, the company is required to make an initial registration statement as per the regulations of the SEBI. In this process, the company and the underwriters submit the SEBI its fiscal data and the future plans of the company. The company is also required to give the declaration about the usage of funds that will be raised from IPO procedure. This declaration ensures that the company has given each and every disclosure that an investor must know. The company must file various versions of the prospectus from the initial stage to the final stage with the investors. The prospectus consists of the company’s details like valuation of the company, risk and rewards of the investment along with other details. This IPO process ends with the filing of the above-mentioned documents. Step 3: Pricing The final price of the Initial Public Offering is determined by the investors. The investment bank markets the IPO. To attract the public to the IPO application process, they are priced at a discount. By issuing shares at discount, the share performs well when they are listed on the stock exchanges. The price of the stock during IPO procedure can be a fixed price with the price mentioned in the order document. On the other hand, a book building issue will have a price band within the bids that can be made by the investor. Step 4: Stock Listing and Price Stabilization When the shares of the company are listed on the stock exchange and trading begins, the investment bank takes measures to establish the price of the securities. When there are not enough buyers, the bank will purchase the shares. The role of the investment bank in stabilizing the share price is essential. However, one must remember that such buying would last only for a short period of time because the IPO process already consumes a huge amount of capital investment. Step 5: Transition to Market Competition When the company's transition period to the normal competitive environment is over, the company is required to make disclosures like its financial results, significant news, etc. that is material in nature and can affect the price of the shares. The role of the investment bank is still significant. It can continue as an advisor to the company and assist in increasing the price of the shares over a period of time.   Conclusion The above mentioned are the IPO process steps for a successful listing. An IPO can change the fortunes of the company and it can grow at a rapid pace. Apart from the company, investors can also reap the benefits of an IPO by investing in them. Since there are many risks and uncertainties associated with a company going public, good research before investment can be fruitful. The investors can compare the company with its peers and check its fundamentals before investing. An investor must also consider his risk appetite and availability of funds before investing money in the IPOs. If you are an investor and need any assistance regarding investing in the stock market, you can contact IndiaNivesh.Disclaimer: "Investment in securities market and Mutual Funds are subject to market risks, read all the related documents carefully before investing."

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  • IPO Allotment Status – All you need to know about IPO Allotment Process
    Posted by Mehul Kothari | Published on 14 Jan 2020

    Initial Public Offerings have been in existence for a long time. But recently they have come under a lot of limelight. In the July-September period of last year, funds to the tune of USD 0.86 billion were raised from just 10 IPOs. And as per an EY report, IPOs are expected to gain more momentum in 2020. IPOs or Initial Public Offer are the buzzwords these days. Especially after the successful ones like IRCTC and Ujjivan Bank. Indian stock exchanges (BSE & NSE) ranked 6th worldwide in the highest number of IPOs in Quarter 3 of 2019. Read on to understand the IPO Allotment process in detail. Important aspects of bidding in an IPO Before we move to the allotment, we should know some important basics about IPO bidding. These days, most IPOs take the book building route. Some important terms to be aware of: Price Band Each IPO involves a price band. It is a price range within which applicants can make their IPO bids. The upper limit (or maximum price) is s the cap price. The lower limit of the price band is the floor price. The final issues price (known as the cut-off price) is decided based on the bids received.   Lots The total shares (on offer in the IPO) are divided into small lots. Each applicant needs to bid in these lots and not for individual shares. For instance, if a company intends to issue 1 lakh shares and the lot size is 20 shares per lot. Hence, the total number of lots on offer is 5,000. As per the SEBI guidelines, applicants cannot bid for shares quantity which is lower than the lot size. Also, bidding for lots in decimals (such as 1.5 lots) is not permitted. It is important to note that the lot size is applicable only at the stage of IPO allotment. Post listing, investors can trade their shares in the market in whatever quantity they want. ASBA ASBA stands for Application Supported by Blocked Amount. This facility lets you bid in IPOs without paying any money upfront. The amount remains blocked in the bank account and is deducted only after the allotment. IPO Allotment process Share allotment in an IPO needs to be done as per the SEBI guidelines. With the changes introduced by the regulator in 2012, all RII (Retail Institutional Investors) applications need to be treated equally. Some important points about IPO Allotment process: Only bids which are equal to or higher than the issue price qualify for allotment. Retail applicants (with qualified bids) need to be allotted the minimum application size, subject to stock availability in the aggregate. Apart from retail investors, there are two other types of investors in an IPO – QIB (Qualified Institutional Buyers) and NII (Non-Institutional Investors). Allotment to them is done on a proportionate basis. Post submission of all the bids, a computerised application is used to eliminate all invalid bids. This helps to identify the number of successful bids. There can be two situations –Under subscription (number of applications received is lesser than the total lot of shares offered) and Oversubscription (number of applications received is higher than the total lot of shares on offer). Allotment Rules for over and under subscription In case of an under subscription, every investor gets full allotment, regardless of the application size. For retail investors, in case of an IPO oversubscription, the max number of retail applicants eligible for allotment of the minimum bid lot is determined by using this formula – Total no. of shares available for RII (Retail Individual Investors) divided by Minimum Bid Lot. If the IPO is oversubscribed by a huge margin, the final allotment is done through a computerised lottery method. This would mean that some applicants will not get any allotment. If the oversubscription is not by a huge margin, then all applicants will get the minimum bid lot and the balance is proportionality allotted to applicants who had bid for multiple lots.   IPO Allotment Status IPO Allotment Status of each applicant gives the details regarding the number of shares applied for and final allocation in the IPO. The IPO status details are available online on the website of the registrar. Each IPO has a specific registrar such as Karvy, Linkintime, etc. Applicants can check their IPO allotment status by providing details such as PAN, IPO application number, etc. IPO Allotment Status Online is available within one week of the IPO closing date. The entire allocation process takes almost 10 business days. In the case of non-allotment within that period, the amount paid by the applicant is refunded back. The registrar also publishes an allotment document which has all the details regarding the IPO allotment such as the total number of applications received, IPO allotment calculations, etc.   Why were shares not allotted to you in the IPO? There can be three reasons for this. Invalid Bid Bids in an IPO can be rejected or considered invalid for numerous reasons. Some of these are invalid Demat or PAN details, incomplete information, multiple applications by the same person, etc.   Over Subscription Oversubscription means that the demand for the company’s shares exceeds the number of shares issued. In case of a hugely oversubscribed IPO, the shares are allotted based on a lottery. The rationale being that every applicant has an equal chance. If your name does not come up in the lucky draw, you will not be allotted the shares.   Bid Price is below the issue price IPOs following the book building route requires applicants to bid for lots as well as the price they are willing to pay. If the bid price you have submitted is less than the final issue price, you will not get any IPO allotments.   If you want to stay on top of the IPO game, a financial expert can be of great help. A partner like IndiaNivesh, who has more than 11 years of experience in the Indian markets, can keep you informed about all the upcoming IPOs and help you make the most of it.  Disclaimer: "Investment in securities market and Mutual Funds are subject to market risks, read all the related documents carefully before investing."

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  • Tax Saving FD – Know About Tax Saving Fixed Deposit
    Posted by Mehul Kothari | Published on 14 Jan 2020

    Every salaried individual as well as a business person is required to pay taxes as per the income tax laws. While paying taxes, we all aim to legally save it in some way or the other. But how do we do that? It is the most confusing question for most of the taxpayers. One of the excellent ways of saving taxes is by investing in tax-saving investment schemes. They not only help you save taxes but are also instrumental in effectively achieving your financial goals. There are many investment avenues available in the market that either offer tax exemption or tax deduction. Having said that, selecting the most suitable and right tax-saving investments may not come easy for everyone. While choosing the right scheme, one needs to access several factors such as safety, returns and liquidity, among other things. A very popular tax-saving investment option among taxpayers is investments under section 80C. As per section 80C of the Income Tax Act, 1961, investments of up to Rs. 1.5 lakhs can be claimed as a deduction. Tax saving fixed deposit is a type of fixed deposit where you can get a deduction of maximum Rs. 1.5 lakhs under section 80C. To arrive at the net taxable income, the amount invested in tax saving FD is to be deducted from gross total income. Let us learn about some of the important points that you must consider before investing in tax saving FD. Things to Know About Tax Saving Fixed Deposit Investment in tax saving FD can be done by individuals and Hindu Undivided Family (HUF) only. The minimum amount for fixed deposits varies from bank to bank. Income tax saving FD has a lock-in period of 5 years. You cannot make premature withdrawals and loans against these FDs. Investment in these FDs can be made only through private or public sector banks. Rural and co-operative banks are not eligible for these FDs. Tax-saving fixed deposits can be held in ‘singly' or 'jointly'. When the holding is in joint mode, the tax benefit is available to the first holder. Tax saving FD interest rates vary from bank to bank. The interest rate ranges from 5.5% – 7.75%. However, note that some banks offer higher rates on FDs to the senior citizens. These fixed deposits have nomination facilities. The interest earned on the income tax saving FD is taxable according to the investor’s tax bracket. The interest on tax saving FD is payable on a monthly or quarterly basis. The main advantage of investing in tax saving fixed deposits is that they are less risky in comparison to equities. Since many banks offer this type of FD, let us learn about its details. Banks and Income Tax Saving FDs SBI Tax Saving FD Tax saving FD interest rates of SBI is 6.25% for general customers and 6.75% for senior citizens. The maximum deposit in a year is Rs. 1 lakh and the minimum deposit is Rs. 1,000. By using a tax saving FD calculator you can know the amount receivable after the lock-in period of 5 years depending on the maturity period of your FD.   HDFC Bank Tax Saving FD Tax saving FD in the HDFC Bank can be opened with a minimum amount of Rs. 100. The maturity period of this FD is 10 years. Tax saving FD interest rates is 6.30%. Senior citizens get an added benefit of 50 basis points over general customers.   ICICI Bank Tax Saving FD The interest rate on tax saving fixed deposits at the ICICI Bank to the general customers is 6.6% and for senior citizens, the interest rate is 7.10%. These rates are applicable to FDs having a maturity period of 5 to 10 years. The maximum amount that can be deposited is Rs. 1.5 lakhs and the minimum amount for opening tax saving FD at the ICICI Bank is Rs. 10,000.   PNB Tax Saving FD Punjab National Bank offers an interest rate of 6.30% on a five-year tax saving FD. The minimum amount for opening tax saving FD at the PNB Bank is Rs. 5,000.   Bank of Baroda Tax Saving FD Bank of Baroda offers an interest rate of 6.30% on a five-year tax saving FD.   The Bottom Line The above mentioned are the basic details about the major banks that offer income tax saving FDs. You may access each individual option carefully and select the suitable one after doing good research. You can find all the basic information on the bank’s website. If you want to find out the returns that you will be earning from the fixed deposit, you can access the tax saving FD calculator and find out the returns by entering your fixed deposit details. If you want to learn more about income tax saving FD or want to learn about other investment options, you can contact IndiaNivesh. We are among one of the most trusted and value-enhancing financial groups in India.Disclaimer: "Investment in securities market and Mutual Funds are subject to market risks, read all the related documents carefully before investing."

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