The concept of modern warfare is no different. It’s only the currency that differs. Every other major event in the world nowadays is largely driven by virtual currency, and the digital economy; and the tension among both Ukraine and powerhouse Russia is no exception.

Across many sides of the conflict, the last several weeks have been intense. Ukraine has been invaded and bombed, and Russia was sanctioned by some of NATO’s most powerful countries, causing its economy and trade to suffer. Markets, of course, reacted, and some of the share prices and cryptocurrencies went through ebb and flow. 

Digital currencies:

Bitcoin went up owing to its active participation in the Ukraine-Russia conflict; Waves, the Ukrainian-led crypto, was equally on a positive “all-green” track. Seesaw Protocol also managed not only to be negatively affected by the war (as other cryptos have) but to rise by +32 percent in only one week in March 2022.

Bitcoin (BTC): Sanctions imposed on Russia by the US, the UK, and others have targeted the Russian central bank and national wealth fund. The ability of Russian President Vladimir Putin to use the country’s $630 billion in foreign reserves had been severely limited. Furthermore, some major Russian banks were removed from the Society for Worldwide Interbank Financial Telecommunications (SWIFT), resulting in a loss of the country’s economic condition and spending power. Bitcoin (BTC) has returned to its former glory. In the existing crisis, it is playing an important role. The demand for this cryptocurrency has increased, and its valuation has risen yet again.

• On 20th February 2022, the starting date of the Russia-Ukraine conflict, BTC’s closing price was $38,431.38, and throughout the war, the prices continued to go up by breaking the $44,000 level multiple times.

Waves: On 20th February 2022, the starting date of the Russia-Ukraine conflict, WAVES’ closing price was $9.39, and throughout the war, the prices continued to go up by breaking the $45 level multiple times. 

• WAVES was founded by Ukrainian scientist Alexander Ivanov.
• Following the announcement of plans to make a blockchain-agnostic Metaverse and a new collaboration with Allbridge to enable cross-chain transactions, the price of WAVES ramped up by more than 100%.

Seesaw Protocol (SSW): It is a non-custodial decentralized and multi-chain ecosystem of DeFi (Decentralized Finance) products. With its added Metaverse apps, the Seesaw Protocol (SSW) connects the Binance Smart Chain (BNB), Polygon (MATIC), and Ethereum (ETH) blockchains, allowing users to transfer tokens between them. It allows customers to select the platform that has the lowest gas fees.

• SSW has grown by over 1300 % in less than a month and sold more than 75% of the tokens during the first presale simultaneously. Its value has risen sharply by 30%, indicating that it has come a long way. 

Commodities:

Commodity prices in global markets have been rapidly rising sharply since the end of February, reaching an all-time high in March, recreating a similar trend in Indian markets.

Gold & Silver: Precious metal prices have gained a safety net in the face of global uncertainty. The markets are currently quite bullish, but traders who purchased gold prior to February of this year, when prices were still under pressure, have made reasonable profits. 

• On February 21, 2022, the price of gold was 1,278 USD/T, and prices continued to rise throughout the war, breaking the 2052 USD/T level on March 8, 2022, and reaching an all-time high.
• The price of silver was above 23 USD/T on February 21, 2022, and it skyrocketed throughout the conflict, breaking the 26 USD/T level on March 8, 2022.

Crude Oil: Among all of the strategic, geopolitical, and humanitarian concerns, rising crude oil prices and their impact have received a lot of attention. The world suspected that the war would result in a ban on Russian oil in the West. Even before the US and the UK banned Russian oil and gas imports, some countries halted purchase decisions, whereas others started panic buying.

• On March 7, prices reached a 14-year high of $140 per barrel.

Metals: The fear that the world will run out of ferrous and non-ferrous metals as a result of the Russia-Ukraine conflict has caused a spike in their prices. Between February 23 and March 8, three-month nickel futures on the London Metal Exchange (LME) increased by 97%, zinc by 16%, aluminum by 6%, and copper by 3.5%.

• Nickel was above 24820 USD/T on February 21, 2022, and it continued to rise, having broken the 48340 USD/T level on March 7, 2022.

Edible Oil: Edible oil prices have risen as imports from Russia and Ukraine have ceased due to the ongoing conflict. Sunflower oil is primarily imported into India from Ukraine and Russia. Furthermore, for the first time, palm oil has become the most expensive of the four major edible oils as consumers rush to preserve alternatives for sunflower oil shipments from the top exporting Black Sea region that was affected by Russia’s invasion of Ukraine.

• India imports 25 lakh tonnes of sunflower oil each year, with Ukraine accounting for 74% and Russia accounting for 12%.
• Palm oil was trading above INR 1,270/g on February 21, 2022, and it continued to rise, surpassing INR 1,480/g on March 8, 2022.

Food: The invasion of Russia has seriously affected trade from Black Sea ports, driving global Chicago benchmark wheat prices to 14-year highs. Russia and Ukraine are responsible for 30% of global wheat exports and 20% of global corn exports, respectively. 

Wheat futures were trading above INR 2,100/10 metric tonnes on February 21, 2022, and continued to rise, inevitably crossing INR 2,350/10 metric tonnes on March 10, 2022.

Writer: Arpita Chatterjee 

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What is this journal all about?

Our journal “PW Insider” includes an in-depth analysis of the following:

1. Economic Outlook.
2. Stocks IN & OUT of Mutual Fund Portfolio. | Laggards & Leaders.
3. Open Network for Digital Commerce.
4. Insider top 50
5. Entrepreneur of the Month: BERMIOK FARMS.
6. Phases of Retirement.
7.  House Insurance Policy.
8. Beauty Tycoon: Mrs. Ghazal Alagh’s Mamaearth.
9. 7 to have a Systematic Investment Plan.
10. Section 194S – TDS on Crypto Currency/ Virtual Digital Assets.

Do check it out!

Publisher Description:

This book is developed in collaboration with Prudent Wealth.

Prudent Wealth is a Professional Financial Planning and Chartered Wealth Management Firm. It is North Bengal and Sikkim’s fastest-growing Financial Consultant and Wealth Management Service Provider. 

We have served over 2,000+ Clients & have an AUM of 250+ Cr. Prudent Wealth is founded with a vision to provide complete wealth management solutions with professional expertise and the highest level of service standards to its clients. 

Our expertise, knowledge, years of experience, and thorough understanding of finance help the client achieve financial success. Our expertise, knowledge, years of experience, and thorough understanding of finance help the client achieve financial success. 

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Acknowledgment: 

We would like to thank Chandan Ghosh, founder-director of Prudent Wealth, for giving us this opportunity to come up with the journal and share his valuable ideas. We would also like to thank the entire team of MyGoalMySip for their valuable inputs, which have helped us shape this journal.

• Editor PW Insider: Suraj Kar 
• Sub Editor PW Insider: Arpita Chatterjee 

Note to the readers:

This journal is solely developed to help the readers understand the necessity of financial planning, and investing, and its benefits and drawbacks. 

The contents of this publication do not necessarily represent or suggest Prudent Wealth’s endorsement, recommendation, or favoring. This publication is solely intended for educational and informational purposes. 

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Read Next: Gautam Adani: Richest Asian Billionaire in History?

Now, the question is, why is this assessment important?

Recently, if you have observed, you must have seen a lot of new-age investors flocking to the Equity Market, and some are taking a step ahead and are investing in cryptos before investing in any product. One must know the risk and rewards associated with it, but often we skip this part. So, is this the right way to invest, or is our mind hijacked by the quick rich scheme bombarded by the Instagram pages and YouTube influencers lecturing us on how easy the financial market is?

I believe that information should be accessible and available to everyone. Unfortunately, not everyone is on the same level playing field. Everyone doesn’t have the same set of information and a similar level of skills to understand and interpret the complexities of the market. And then there are people behind the curtains who run the show and adding to that, we have also witnessed scams perpetuated by digital thieves with a coded knife.

Before understanding any financial product, one must understand their financial status and their state of mind; as an investment is not only the exchange of money from your pocket to someone else’s purse, investment is a decision linked to your life, every major and minor event that you will eventually encounter which involves financial decisions will have an impact on the money decisions that you made in the past.

Said so, let’s understand ‘Risk Appetite’, as this is one of the key factors to your investment decision.

Risk appetite refers to the ability, willingness, and psychological capacity to take the risk. Different individuals have different levels of risk-taking capacity.

If you ask a salaried person, he would want a stable life. On the contrary, a business person might be willing to trade an extra risk for higher gains. An old man, in his late 50’s wishes to spend the rest of his life in peace, gardening and sipping a cup of tea with his beloved wife, rather than brewing heartaches by the volatility of the market. Similarly, if you suggest a man/woman at his prime, who wants to own a house after 10 years to invest in Bank FD’s, it would be a grave injustice.

To understand your Risk Profile you can take a risk assessment test, and you will be assigned any of the following profiles:

1. Very Aggressive: These investors aspire to outperform the markets by a substantial margin, and they are taking on significantly more risk than the markets. Their portfolio majorly consists of growth, small-cap, and sector mutual funds. Any fixed-income mutual funds that are included in the portfolio will be of riskier types and those that are generally aggressively managed. The purpose of any cash held is to handle any unexpected withdrawals and to take advantage of perceived buying opportunities.
2. Aggressive: An investor in this category wants to outperform the market when the markets are up and doesn’t mind too much, being down a little more than the markets when they are down. Fixed income positions are minimized, and risky asset classes are fully utilized. The portfolio is aggressively-managed. These investors want to take the risks of winning the game by playing hard offense but still don’t want to lose too much in a short period.
3. Moderate: The majority of investors fall in this category. These investors generally have a long-term goal either for retirement or funding for children’s education & marriage expenses. These investors are looking for high profits and are aware that they will have to take certain risks to get them. Their portfolio would gain less or equal to that of the market at the time of rising and fall less when the market falls. A Moderate portfolio will hold a balanced mix of all-major viable asset classes (for maximum diversification).To limit risk and improve revenues, both safe and risky asset classes are employed to their full potential.
4. Conservative: The investor in this category can tolerate a little more risk than the highly conservative investors. They are averse to large short-term downside fluctuations and are happy with little more return with a little less income. The average investor in this category is either retired and earning a living from their investments or is about to retire. These folks want to be shielded against significant market downturns, also they’re not willing to fully participate in upward market rallies.
5. Highly conservative: This investor desires to be protected from “noticeable downside market fluctuations” and will forsake almost all considerable upside possibilities relative to the markets to attain their goal. Often these investors want an inflation-adjusted stream of income from their holdings to cover their living needs. Investors are afraid of losing what little money they have left. They don’t have time to make up for any lost ground. The majority of their money should be held in liquid and high-quality Debt Mutual Funds, risky asset classes are typically avoided altogether.

When you have identified your “Risk Profiles”, you are halfway ready for your investment journey. You can also take a risk assessment test by downloading the MyGoalMySip app.

Written by: Arup Kr. Mondal

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This observation is, without a doubt, predictable. Monetary lessons, after all, are a part of the different influences which emerge within us as we go and grow through life.  A significant part of my approach towards finance was shaped by how my family dealt with it as I grew up. 

The twist, in my opinion, is that, although my family was somewhat orthodox, the women were still very active participants, and to a certain extent, rather dominating. In retrospect, I consider myself very fortunate to have had these influences and to have been able to learn from them. Two women in my life deserve special recognition for sharing their experiences and inspiring me.

Financially, planning ahead, starting early, and being prepared for emergencies:

I spent a considerable amount of time at my maternal grandmother’s house because, first, we lived in the same city, and second, my grandma was the best. I have two vivid recollections of hers, both of which seem to be pertinent even now.

One, after my grandfather passed away, she continued my grandfather’s tradition of investing in a local chit fund regularly. It piqued my interest, so when I started going to college, I set up my first savings account with a grand sum of Rs. 2000 by saving my pocket money. I also used to deposit 100 or 200 every month by saving the money I used to get for lunch. I had my own passbook, which I kept up to date. I may be romanticizing this a little bit more than usual, but I believe this is when my “a penny saved is a penny earned” behavior began.

The other memory I have of her is, she had this little trunk, which only she had the keys to, where she kept all the cash that she saved for emergencies. That fund used to be her go-to anytime someone in the family needed money.  I remember her giving me money to get chocolates, but secretly. Probably one of the least obvious aspects of being “fiscally sustainable,” it turns out, is having enough liquidity when needed. Funny how they spoil us and teach us valuable lessons at the same time.

Stepping out of our comfort zone through delayed gratification:

We didn’t have the easiest of childhoods and growing up as the eldest kid got me a front-row seat to my mother’s struggle to make ends meet. Just like all mothers, she always figured out a way to meet our demands, no matter how insignificant they were (dining out once in a while, for example) while sacrificing some of her own. I’m not sure how she was able to put off her needs and desires so effortlessly. I suppose it was from watching her that I learned about delayed gratification.

Another thing that intrigued me was her decision to pursue a career in her 40s. Despite her education, she had never worked before. However, when my sister and I grew up, she decided not to waste her time at home anymore and realized that she would rather help support the family financially. She started working six days a week in a gas agency. She worked there for a long time before covid hit us. Despite the low pay, she certainly enjoyed this “second innings” of her life.

Her breakout towards financial independence didn’t end there. The moment she had to leave the job, her entrepreneurial journey started. Despite the many challenges associated, she always gets excited to learn new things and start from scratch. In fact, she told me that, not taking risks is, in some ways, the greatest risk.

Each of these events has shaped my approach towards finance, and they have pushed me to pursue a career and kick start my financial planning journey. It encouraged me to stay grounded and keep my stupid desires at bay.

We still witness several women who are not as active in family financial decisions, which leads me to conclude that I’ve been fortunate in this regard. When it comes to making any decisions at home, two heads are usually better than one!

Written by: Arpita Chatterjee 

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