Tuesday, 28 December, 2010

A fool & his money seldom stay together!

A fool & his money seldom stay together!

You must have heard / watched / read about the fraud that happened at Citibank, Gurgaon, India.

Here are some details:

All I wish to point out is:

  • If someone is talking about doubling your money in double-quick time, is it not your responsibility to get enough details about it in terms of:
    • The type of investments 
    • The lock-in period, if any
    • How the returns are proposed to be generated
    • Charges involved
    • The comparable products for the same risk profile (from Citi as well as from other competitors)

If someone doesn't bother to do even such basic due diligence, I guess that such frauds will continue to happen from time to time.

If you're greedy, at least

  • Go and buy some junk stocks with the hope of tripling it in 10 days
  • Go and play around in futures and options, commodities, etc., preferably without doing too much of research about risks involved
  • By artwork by an unknown artist from Christies / Sotheby, hoping that he'll become tomorrow's Picasso / MF Hussain in the next couple of years

In each of the above options, the probability is high that you'll lose money. However, you'll at least have the satisfaction that the profits (if you're extraordinarily lucky) as well as losses will be entirely on account of your own efforts. You'll have the satisfaction of not having fallen prey to some conman!



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