Thangavel.....

With changing interest rates and pricey homes, here's how you can be a savvy customer. By Padmavathi Subramanian I live in what's arguably the city with the world's highest real-estate prices. But our Mumbai flat was too tiny—my family, I felt, deserved something better. Selling it and moving to an affordable, larger flat farther away from my downtown office, where I reach after an hour's commute, would make my life even harder. Then, in mid-2005, my next-door neighbours decided to sell their equally small flat. I bought it with a home loan from HDFC Ltd, pulled down a wall and joined the two flats to create a fairly large home. While applying for the loan, one question troubled me. Should I choose a fixed rate of interest, or a floating rate—one that could go up or down, depending mainly on inflation? Interest rates were low in 2005. But one never knows: "low" and "high" are relative terms in the world of finance. If I chose the 7.75% fixed rate off

Dangerous Definitions: Know Your Hedge Funds The hedge fund industry may appear to be a risky investment choice right now but not every investment instrument referred to as a 'hedge fund' may necessarily behave according to the true definition. With a little research, hedge funds can still provide a good return. On the surface, the hedge fund industry, like telecoms, dotcoms and banks before it, is now apparently crashing and burning. Schadenfreude all round, some may say. In recognition of the fact that 'hedge fund' is an unhelpful modern misnomer in the same way that 'government bailout' is, we might like to establish some workable definition by which to measure what a hedge fund actually does. Or, rather, should do. How about: 'Moderately leveraged, bi-directional, speculative trading in liquid and transparent markets in order to achieve absolute returns unrelated to traditional asset classes.' This sounds simple enough, so why do most hedge fund