Why Investors Invest In Hedge Funds

Why Investors Invest In Hedge Funds Abstract Hedge funds have gained a lot of popularity in the last decade and are one of the fastest growing industries. The main aim of most hedge funds is to reduce volatility and risk. It also attempts to preserve capital and deliver positive returns under all market conditions. Not all hedge funds are same therefore it is important to know the difference between them. It differs in terms of its risks,  investment returns and volatility among the different hedge fund strategies. The strategies which are correlated to equity markets deliver consistent returns and have low risk while the ones that are not will be more volatile. Main objective of hedge funds is to provide consistency in its returns for investor, lower portfolio volatility and preserve their capital investments, which is the reason why investors such as pension funds, insurance companies, institutional investors and high net worth individuals and families invest in hedge funds. This thesis reviews various issues relating to the investment in hedge funds, which have become popular with high net-worth individuals and institutional investors, as well as discuss their empirical risk and return profiles. The concerns regarding the empirical measurements are highlighted, and meaningful analytical methods are proposed to provide greater risk transparency in performance reporting. It also discusses the development of the hedge fund industry in Asia. Asian hedge funds have grown vastly in past few years. It is said to have grown nearly six times as many funds while managing ten times are much in assets since 2000 according to Eurekahedge. The industry is estimated to consist over 1100 funds, and managing roughly $175 billion in assets. International managers are starting up their own Asia-focused funds too. Allocators are increasingly eyeing investment opportunities in Asia. Funds with a global mandate are increasing their allocation to Asia. The paper presents an overview of hedge funds, describing their development and characteristics. It also discussed the various issues related to the measurement of hedge fund performance, as well as examined alternative performance measures. This thesis ends with some remarks on the development of the hedge fund industry in Asia. 1. Introduction There has several definition of hedge funds throughout the history. There isnt one particular sentence that defines what hedge funds really means. However, according to Chicago Board Options Exchange (No Date), hedge funds can be defined as: A conservative strategy used to limit investment loss by effecting a transaction that offsets an existing position. Alfred Winslow Jones was the first person to create hedge fund structure more than 50 years ago. The fund established had following feature: He created hedges by investing in securities that was said to be undervalued and funded these positions by taking short positions in overvalued securities hence creating market-neutral position. He designed an incentive fee compensation arrangement for fund mangers. They were paid a percentage of profit from the clients capital assets; and He so invested his own investment capital in the fund, to make sure that his capital and that of his investors were coordinated and in line so that it is not just an individual investment but a partnership Almost all modern hedge funds have above listed features in them, and are set up as limited partnerships with a lucrative incentive-fee structure. In most hedge funds, managers also have a significant portion of their own capital invested in the partnerships. The term hedge fund has been generalized to describe investment strategies that range from the original market-neutral style of Jones to many other strategies and opportunistic situations, including global/macro investing. There is a large variety of hedge fund investing strategies present today and therefore no standard way to classify hedge funds separately. Many data vendors and fund advisors set up their own major hedge fund styles according to their popularity. Under the classification by Credit Suisse, the categories of hedge funds with 9 differentiated styles and a fund-of-funds category: (a) Event driven funds are the funds that take positions on corporate events when companies are undergoing re-structuring or mergers. For example, fund managers would purchase bank debt or high yield corporate bonds of companies undergoing the re-organization which is often referred to as distressed securities. Another event-driven strategy is merger arbitrage where the funds seize the opportunity to invest just after a takeover has been announced. They purchase the shares of the target companies and then short these shares of the acquiring companies. (b) Global funds are categories of funds that invest in non-US stocks and bonds with no specific strategy reference. This fund has the largest number of hedge funds and it includes funds that specialize on the emerging markets. (c) Global/Macro funds are the funds that rely on macroeconomic analysis and invest in long and short position in order to capitalise on major risk factors and unforeseen markets such as currencies, interest rates, stock indices and commodities. (d) Market neutral funds refer to hedge fund strategy that involves utilizing strategies such as long-short equity, stock index arbitrage, convertible bond arbitrage and fixed income arbitrage. Long-short equity funds use the strategy of Jones by taking long positions in selective stocks and going short on other stocks to limit their exposure to the stock market. Stock index arbitrage funds trade on the spread between index futures contracts and the underlying basket of equities. (e) Dedicated Short Bias  funds are strategies that take more short positions than long positions and earn returns by maintaining net short exposure in long and short equities. Detailed individual company research typically forms the core alpha generation driver of dedicated short bias managers, and a focus on companies with weak cash flow generation is common. To affect the short sale, the manager borrows the stock from a counter-party and sells it in the market. Short positions are sometimes implemented by selling forward. Risk management consists of offsetting long positions and stop-loss strategies. (f) Convertible bond arbitrage funds typically capitalize on the embedded option in these bonds by purchasing them and shorting the equities. (g) Fixed income arbitrage is a strategy that bets on the convergence of prices of bonds from the same issuer but with different maturities over time. This is the second largest grouping of hedge funds after the Global category. (h) Short/long fund-, shorts focus on engineering short positions in stocks with or without matching long positions. They play on markets that have raised too fast and on mean reversion strategies. Long funds take long equity positions with leverage. Emerging market funds that do not have short-selling opportunities also fall under this category. (i) Emerging Markets  funds invest in currencies, debt instruments, equities and other instruments of countries with emerging or developing markets (typically measured by GDP per capita). Such countries are considered to be in a transitional phase between developing and developed status. Examples of emerging markets include China, India, Latin America, much of Southeast Asia, parts of Eastern Europe, and parts of Africa. There are a number of sub-sectors, including arbitrage, credit and event driven, fixed income bias, and equity bias. (j) Fund of funds refer to funds that invests in a pool of hedge funds. They specialize in identifying fund managers with good performance and rely on their good industry relationships to gain entry into hedge funds with good track records. Table 1 gives statistics about the various categories of hedge funds and past performance. The global/macro hedge funds provided the best mean return over the period studied, while the event-driven funds had the lowest standard deviation of returns. On a risk adjusted basis which is obtained by dividing the mean return by the standard deviation, the category of fund that ranks highest is the global/macro funds followed closely by event-driven funds. Hedge funds are not required to publicly disclose performance and holdings information unlike the registered insurance companies, which might be construed as solicitation materials. This is the reason why which makes it more difficult for investors to evaluate hedge fund managers. TABLE 1 Jan 2000   Nov 2009 Categories Mean Return (%) Standard Deviation (%) Risk-Adjusted Return Event driven 8.66 5.44 1.60 Global 6.60 6.23 1.06 Global / Macro 12.28 6.07 2.02 Market neutral 2.09 13.48 0.16 Short/Long 5.50 8.88 0.62 Emerging Market 9.23 11.05 0.84 Convertible Arbitrage 6.98 8.34 0.84 Dedicated Short Bias (1.95) 16.40 (0.12) Fixed Income Arbitrage 3.66 6.81 0.54 Source: Credit Suisse/ Tremont hedge index Notes: The mean returns are annually compounded returns over the period 2000 to November 2009, The annualized standard deviations were computed from of the standard deviation of monthly returns for each investment style. Risk-adjusted returns are obtained by dividing the mean return by the standard deviation. In 1990 the entire hedge fund industry was estimated at $20 billion. At the end of 2008, global hedge fund industry was estimated to be worth $1 trillion with 8350 active funds. It has gained a lot of popularity in the last decade and is one of the fastest growing industries. While hedge funds are well established in US and Europe, they have also been growing rapidly in Asia. Hedge funds have posted attractive returns. A seven year annualised return of 2.47% posted by Hedge Fund Research (HFR) from 2003 to 2009, higher than the SP 1200 of 1.18%. Hedge funds are seen as natural hedge to control downside risk because they employ investment strategies believed to generate returns that are uncorrelated to traditional asset classes. Hedge funds differ in strategies- a macro fund such as quantum fund generally take a directional view by betting in particular bond market or a currency movement. Other funds specialise in corporate events such as mergers or bankruptcies. They also vary widely in investment strategies and the amount of financial leverage. In the recent financial crisis, hedge funds have been heavily criticised in terms of their strategies and also for the fact that in 2008, they have had hard time fulfilling their absolute return targets. There have been other criticisms towards hedge fund regarding this particular crisis. Stromqvist (2009) writes that ever since the growth of hedge fund industry there has always been discussions regarding the role of hedge funds in a financial crisis. The main focus of the criticism was on highly leveraged hedge funds and that they may have a large impact on price stability on both currencies and equities. In an article written in The Times, Dillow (2008) observes that even though average return of hedge funds in 2008 has been poor, they have not been a serious source of instability in the wider financial system. Regardless of the recent financial crisis, hedge funds still generate a growing number of interests all around the world. Due to their private nature, it is difficult to obtain information about the operations of individual hedge funds and reliable summary statistics about the industry as a whole. It is a common belief that investing in hedge funds can have superior returns. Many success stories have emerged in the past and the most popular of which is the George Soros story. In September of 1992, he risked $10 billion on a single  currency  speculation when he shorted the British pound, which gave him an international fame. He was right, and in a single day he successfully generated a profit of $1 billion â‚ ¬Ã¢â‚¬Å" ultimately, it was reported that his profit on the transaction almost reached $2 billion. Therefore, he is famously known as the the man who broke the  Bank of England. The greates investor: George Soros, http://www.investopedia.com/university/greatest/georgesoros.asp 16-12-09 As seen in Table 1, the hedge funds as a group can generate positive returns. For example, over the period 1990-1997, all the hedge funds had positive absolute returns. Global/Macro funds obtained mean returns of 28.1% p.a. with a standard deviation that is comparable to equity funds. Traditional asset allocation makes the most of the use of equities, bonds, real estate and private equity to invest in a portfolio that maximizes returns and minimizes the portfolio risk. Therefore, in an investment portfolio hedge funds can play a vital role in maximising returns. Moreover, in a bear market, many investment and fund mangers find it dull to just beat the market index, which may have negative returns. They generally prefer to go short or avoid long positions to have positive returns. Choosing an appropriate hedge fund to invest increases the possibility of obtaining positive absolute returns. It is also generally believed that hedge funds have returns that are generally uncorrelated with the traditional asset classes. In fact, hedge funds may even have a lower risk profile. For example, Morgan Stanley Dean Witter (2000) reported that hedge funds exhibit a low correlation with traditional asset classes, suggesting that hedge funds should play an important role in strategic asset allocation. The answer to the question Why invest in Hedge funds? simply is to make money. The common analogy in all hedge funds strategies and the underlying rationale for investing in hedge funds is the search for absolute returns. This is sometimes called alpha. Alpha is the extra return a skilled manager can produce over and above the market return (or beta). Whereas many conventional fund managers aim simply to outperform their chosen benchmark index, hedge fund managers seek to produce positive gains in all market conditions. http://www.fleetstreetinvest.co.uk/shares/trend-investing/hedge-fund-investing-00128.html Research Question By using quantitative study, I will try to answer the following questions: Why investors invest in hedge funds? To answer this question I will be looking at the return, risk and performance associated with investing in hedge fund and how the fund mangers. By looking at the annualised return, standard deviation and risk adjusted returns of different styles of hedge funds their performance can be measured. What are the issues relating the investment in terms of risk, return and performance measurement? Although hedge funds are popular in terms of an investment vehicle, there are various issues. The issues related are its cost/ management fee structures, collection of data, survivorship bias and selection bias. Various performance measure techniques are available for hedge funds too. I will be looking at some of the performance measurement approaches. Purpose There are several purpose for this paper. First is to give an overview of hedge fund as an investment vehicle with a short description of different characteristics and styles of hedge funds. Second is to describe why hedge funds are attractive for investors and fund managers by presenting different theories where risk and returns of hedge funds are investigated in order to evaluate the performance measures. Third purpose is to investigate the issues related to the investment in hedge funds where several sets of issues are evaluated and various performance measures are identified. LITERATURE REVIEW There is no one particular definition of hedge fund as mentioned earlier. According to the Investment Company Act 1940 of the US, hedge funds were defined by their low degree of regulatory controls. In comparison to mutual funds, hedge funds were seen to have higher level of risk. This led to a 100-investor limit as well as wealth requirement of the investors. Fung and Hsieh (1999) claim that another reason for 100-investor limit is the use of leverage and short selling in hedge funds. The limit restrictions were later abandoned and wealth requirement lowered. Many definitions of hedge funds have been cited-most of them mainly based on its characteristics. Some of them are: Investment companies that by their charter can buy on margin, sell short, hold warrants, convertible securities and commodities and otherwise engage in aggressive trading tactics in order to profit from forcasting market swings.- Polhman, Ang and Hollinger (1978) A mutual fund that employs leverage and uses various techniques of hedging- Soros (1987) hedge funds are vehicles that allow private investors to pool assets to be invested by a fund manager. Unlike mutual funds, hedge funds are commonly structured as private partnerships and thus subject to only minimal SEC regulation. Moreover, because hedge funds are only lightly regulated their managers can pursue investment strategies involving, for example, heavy use if derivatives, short sales and leverage.- Bodie, Kane and Marcus (2008). Murguia and Umemoto (2004) claims that the reason why there is no proper definition of hegdge funds is because they are not classified by the different asset classes but by the type of strategies employed by the fund mangers is what classifies them. Such strategies range from very aggressive to conservative, which is the reason why there is no clear definition. Several studies have been carried out about hedge funds performance and risk issues. Fung and Hsieh (1997a) extend Sharpe (1992) style analysis and conclude that there are more diversified hedge fund strategies and suggested that hedge fund strategies are more dynamic. The literatures also conclude that option-based factors can enhance the power of explaining hedge fund returns. Brown, Goetzmann and Ibbotson (1999) examine the performance of offshore hedge funds and attribute fund performance to style effects rather than managerial skills. Brown, Goetzmann and Liang (2003) found, in a study using the TASS database, that fund of hedge funds reduce by a third the standard deviation of monthly hedge fund returns, as well as significantly reduce the value at risk of hedge fund investment. Hence, fund of hedge funds can also provide significant diversification potential. A well-diversified fund of hedge fund manager can therefore take advantage of market-specific risks while maintaining low correlations to stock, bond, and currency markets. As a result of which the fund of hedge fund manager can provide superior returns and generate alpha which reflects managerial skills. More generally, since fund of hedge funds deliver more consistent returns with lower volatility than individual hedge funds, they are considered to be ideal for diversifying traditional portfolios. During 1993â‚ ¬Ã¢â‚¬Å"2001, fund of hedge funds outperformed the SP 500 index on a risk-adjusted basis (Gregoriou, 2003a). Koh, Koh, Lee and Phoon(2004) state that traditional asset allocation optimizes the use of equities, bonds, real estate and private equity to invest in a portfolio that maximizes returns and minimizes the portfolio risk. Thus, hedge funds become vital in enhancing returns in an investment portfolio. Following the growth in hedge fund industry, fund-of-hedge funds (FOF) have become more and more popular. Liang (2003) states that FOF mixes various strategies and asset classes together and creates more stable long-term investment returns than any of the individual funds. It invests in underlying hedge funds and diversifies the fund specific risks and relieves burdens on investor to select and monitor managers, and providing asset allocation in dynamic market environments. Fund-of-funds require less initial investment as compare to hedge funds and therefore are more affordable for small investors. To participate in the investment, small investors may be willing to pay extra fees as it might be the only way for them. Previous studies in this area by Brown, Goetzmann and Liang (2002) conclude that combining hedge funds with fund-of-funds not only causes the double counting but also hides the difference in fee structures between hedge funds and fund-of-funds. Liang (2003) state that a hedge funds charges a management fee and incentive fee while a fund-of-funds not only charges these fees at a fund-of-fund level but also passes hedge fund level fees in the form of after fee returns to the fund-of-fund investors whether or not the fund-of-funds make a profit. Brown, Goetzmann and Liang (2002) examine this issue and propose an alternative fee which provide a better incentive for fund-of-fund managers and reduce the cost for investors under the current fee structure, which is that the fund-of-fund managers absorb the underlying hedge fund fees and establish their own incentive fees at the fund-of-fund level. Liang (2003) conclude that because of the above issues fund-of-funds need to be separated from hedge funds in academic studies and address the difference in performance, risk and fee structures. However, the FOF mangers can add value to the portfolio through selection, construction and continuous monitoring of the portfolio. They provide professional services and have access to the information that are expensive and difficult to obtain otherwise. The FOF mangers quite often use different investment strategies and styles through a diversified portfolio of individual fund managers. Considering these advantages for an investor, investing in fund of hedge funds is not cheap. The cost can be as high as the cost of buying a building, according to Koh, Koh, Lee and Phoon (2004). This structure allows for more diversified portfolio and much reduced risk at the fund level which comes at a price. More diversified the portfolio is it is more likely that it will incur more incentive fees. Therefore, there are many persuasive reasons why investing in hedge funds are considered as alternative investments. Some uninformed investors may be misled about the risks and returns on hedge funds as it relies heavily on statistical compilation from the database vendors which is filled with data bias such as survivorship bias and selection bias. Fung and Hsieh (2001a) found that estimates of survivorship biases differed across two commonly used databases, HFR and TASS. The survivorship bias was much higher in TASS than that in HFR. They estimated that survivorship bias would over-report hedge fund mean returns by about 1.5% to 3% per annum. Brooks and Kat (2001) stated that around 30% of newly established funds do not survive the first three years, primarily due to poor performance. Thus, not including defunct funds is likely to lead to over-estimation of the returns and profile of hedge fund industry.

Hindu Women and Their Coparcenary Rights

NATIONAL LAW INSTITUTE UNIVERSITY BHOPAL VI TRIMESTER FAMILY LAW – II HINDU WOMEN AND THEIR COPARCENARY RIGHTS SUBMITTED TO – SUBMITTED BY – Ms. Kavita Singh Archana 2011 B. A. ,LL. B 79 VI Trimester INDEX SERIAL NUMBER |HEADINGS |PAGE NUMBER | |(1) |INTRODUCTION |3 | |(2) |TRADITIONAL POSITION |4 | |(3) |DAYABHAGA COPARCENARY SYSTEM |4 | |(4) |MITAKSHARA COPARCENARY SYSTEM |4 | |(5) |MARUMAKKATTYAM LAW |5 | |(6) |POSITION OF WOMEN UNDER CONSTITUTION |6 | |(7) |CONCEPT OF COPARCENARY AND JOINT PROPERTY |7 | |(8) |PARLIAMENTARY DEBATE |7 | |(9) |SECTION 6 OF HINDU SUCCESSION ACT |8 | |(10) |NEW COPARCENARY UNDER STATE ACTS 10 | |(11) |WOMAN AS KARTA |12 | |(12) |JUDICIAL INTERPRETATION |13 | |(13) |PROBLEMS OF COPARCENARY RIGHTS OF WOMEN |14 | |(14) |RECOMMENDATIONS |15 | |(15) |CONCLUSION |16 | |(16) |BIBLIOGRAPHY |17 | INTRODUCTION The Constitution of India provides that every person is entitled for equality before law and equal protection of the laws and thereby prohibits discrimination on the basis of caste, sex and creed.The discrimination on the basis of sex is permissible only as protective measures to the female citizens as there is need to empower women who have suffered gender discrimination for centuries. Since time immemorial the framing of all property laws have been exclusively for the benefit of man, and woman has been treated as subservient, and dependent on male support. The right to property is important for the freedom and development of a human being. Prior to the Hindu Succession Act, 1956 shastric and customary laws that varied from region to region governed Hindus and sometimes it varied in the same region on a caste basis resulting in diversity in the law. Consequently in matters of succession also, there were different schools.The multiplicity of succession laws in India, diverse in their nature, owing to their varied origin made the property laws even mere complex. The ultimate sufferers of these complexities are women as their position regarding property rights is vulnerable in a coparcenary system. In our project we are trying to analyze the discrimination against women under Hindu Succession Act, 1956. The paper begins with a study of devolution of property in various traditional schools. It then proceeds to analyze the position of women in the Constitution of India. The focus of this paper is on the concept of coparcenary and the inherent discrimination meted on the women by depriving them proprietary rights in the Hindu Succession Act, 1956.Finally, we have analyzed the new notion of coparcenary under various State amendments and the pros and cons of these amendments in the light of right to equality guaranteed under the Constitution of India. TRADITIONAL POSITION The entire concept of coparcenary originates in the Classical Hindu law, so it becomes imperative to understand the position under these traditional schools before we proceed further – THE DAYABHAGA COPARCENARY SYST EM The Dayabhaga School is followed in primarily in West Bengal, Bihar, Assam and parts of Orissa. According to this school neither son nor daughter gets by birth or by survivorship a right in the family property, though joint family and joint property is recognized in this school.It lays down only one mode of succession and the same rules of inheritance apply whether the family is divided or undivided and whether the property is ancestral or self-acquired. In this school neither sons nor daughters become coparceners at birth nor do they have rights in the family property during their father's lifetime. However, on his death, they inherit as tenants-in-common. It is a remarkable feature of the Dayabhaga School that the daughters also get equal shares along with their brothers. But, since this ownership arises only on the extinction of the father's ownership none can compel the father to partition the property in his lifetime and the latter is free to give or sell the property withou t their consent.Therefore, under the Dayabhaga law, succession rather than survivorship is the rule. If one of the male heirs dies, his heirs, including females such as his wife and daughter would become members of the joint property, not in their own right, but representing him and manage the property on behalf of the other members in the Dayabhaga School. MITAKSHARA COPARCENARY SYSTEM The Mitakshara law is followed extensively in India. According to this school, a son by birth acquires a right and interest in the joint family property. But, the interest in the property is restricted to three generations of male lineal descendants, which includes son, grandson and the great grandson.These three constitute a class of coparceners, based on birth in the family. Under the Mitakshara system, joint family property devolves by survivorship within the coparcenary. This means that with every birth or death of a male in the family, the share of every other surviving male either gets diminish ed or enlarged. For example, if a coparcenary consists of a father and his two sons, each would own one third of the property. If another son is born in the family, automatically the share of each male is reduced to one fourth. But, no female is recognized as a member of the coparcenary in Mitakshara law. We find many variations of this school in different parts of India.According to the Bengal, Banaras and Mithila sub- schools of Mitakshara recognise five female relations—  widow, daughter, mother, paternal grandmother, and paternal great-grand mother as being entitled to inherit. [1] The Madras sub-school recognized the heritable capacity of a larger number of females including the son’s daughter, daughter's daughter and the sister’s heirs who are expressly named as heirs in Hindu Law of Inheritance (Amendment) Act, 1929. [2] The son's daughter and the daughter's daughter ranked as bandhus in Bombay and Madras. The Bombay school which is most liberal to wome n, recognizes a number of other female heirs, including a half sister, father’s sister and women married into the family such as stepmother, son's widow, brother’s widow and also many other females classified as bandhus. THE MARUMAKATYAM SYSTEMThis system prevailed in Kerela wherein the family was joint and a household consisted of the mother and her children with joint rights in property. The lineage was traced through the female line i. e. matrilineal. The joint family so formed is known as Tarwad. In this system both male and females are equally the members of joint family. Son be the member of mother’s coparcenary but son’s son would not be the member of this system. He will be member of his mother’s Tarwad. Here both male and female accrues interest in property. This system explains how traits moved towards matriarch cal from patriarch cal. However, joint family system in Kerela are abolished by Kerela Joint Family Abolition Act.But even today at some places customary law governs. THE POSITION OF WOMEN UNDER THE CONSTITUTION OF INDIA The framers of the Indian Constitution have taken special care to ensure that the State should take positive steps to give women equal status with men. Articles 14, 15(2), (3) and Article 16 of the Constitution of India, attempt not only inhibit discrimination against women but in appropriate circumstances provide a free hand to the State to provide protective discrimination in favour of women. Also Part IV of the Constitution which contains the Directive Principles of State Policy interalia provides that the State shall endeavor to ensure equality among individuals[3].Notwithstanding these Constitutional mandates and directives, a woman is still neglected and the rights of the women is blatantly disregarded by some of the provisions of personal laws like the inherent discrimination and inequality in the Mitakshara coparcenary under Section 6 of the Hindu Succession Act, 1956. But, to say th at coparcenary rights under Mitakshara system violates Article 14 raises an important question- Does â€Å"laws in force† in Article 13(1) of the Constitution include personal laws? The Apex Court has yet to give a definitive view on this point. But in State of Bombay v Narsu Appa Mali[4] the Bombay High Court took the view that the term â€Å"laws in force† includes only laws passed or made by legislature or other competent authority and does not include personal laws.But in the Supreme Court in Sant Ram v Labh Singh[5] and in Shri Krishna Singh v Mathura Ahir[6] has accepted the contrary. But, Seervai is of the opinion that- â€Å"We have seen that there is no difference between the expression ‘existing law’ and the ‘law in force’ and consequently, personal law would be ‘existing law’ and ‘law in force’. This consideration is strengthened by the consideration that custom, usage, and statutory law are so inextricabl y mixed up in personal law that it would be difficult to ascertain the residue of personal law outside them†[7] THE CONCEPT OF COPARCENARY AND JOINT PROPERTY In the Hindu system, ancestral property has traditionally been held by a joint Hindu family consisting of male coparceners.Coparcenary can be defined as a narrower body of persons within a joint family and consisting of father, son, son's son and son's son's son. Ancestral property continues to be governed by a wholly partrilineal regime like the Mitakshara school, wherein property descends only through the male line as only the male members of a joint Hindu family have an interest by birth in the joint or coparcenary property. Since a woman cannot be a coparcener, she is not entitled to a share in the ancestral property by birth. But a son's share in the property would increase in case the father dies interstate would be in addition to the share he has on birth.This is a clear discrimination against women. PARLIAMENTARY DEBATE ON THE ADOPTION OF MITAKSHARA COPARCENARY SYSTEM The  provisions regarding succession in the Hindu Code  Bill, as  originally  framed  by  the  B. N. Rau  Committee  and piloted   by   Dr. Ambedkar,  Ã‚   was  Ã‚   for  Ã‚   abolishing  Ã‚   the Mitakshara   coparcenary with its concept of survivorship   and the son's right by birth in a joint family   property and substituting it with the principle of inheritance by succession. These proposals met with a storm  of conservative opposition. The  extent  of  Ã‚   opposition within the government itself can be gauged from   the   fact   that   the   then   Law Minister Mr.Biswas, on the floor of the house, expressed   himself against   daughters   inheriting property from their natal   families. Sita Ram S Jajoo from  Madhya  Bharat, identified  the  reason for the opposition accurately,  when he stated:   â€Å"Here we feel the  pinch  because it t ouches our   pockets. We male members of this house are in a huge majority. I do not wish that the  tyranny  of the majority may be imposed on the minority, the female members of this house. â€Å"[8] However, the majority   prevailed when the Bill was finally passed in 1956. When Dr. Ambedkar was questioned as to how the provisions relating to coparcenary was retained in spite of strong opposition he said:   â€Å"It was not a compromise.My enemies combined with my enthusiastic supporters thought that they  might damn the Bill by making it appear worse than it was. [9] By the retention of the Mitakshara coparcenary without including females it meant that females cannot inherit ancestral property as males do. If a joint family gets divided, each male coparcener takes his share and females get nothing. Thus the law by excluding the daughters from participating in coparcenary ownership not only contributed to an inequity against females but has led to oppression and nega tion of their right to equality and appears to be a mockery of the fundamental rights guaranteed by the Constitution. [10] SECTION 6 OF THE HINDU SUCCESSION ACT, 1956.Section 6 deals with the devolution of interest of a Hindu male in coparcenary property and recognizes the rule of devolution by survivorship among the members of the coparcenary. The provision relating to co-parcenary property in the Hindu succession Act 1956 is Section 6 which provides that if a male Hindu dies leaving behind his share in Mithakshara Co-parcenary property, such property will pass on to his sons, son’s son’s, son’s son’s son by survivorship, on surviving members. In case there are female relatives like daughter, widow, mother, daughter of predeceased son daughter of predeceased daughter widow of predeceased son, widow of predeceased son of a predeceased son, then the interest of the deceased co-parcenary will pass on to his heirs by succession and not by survivorship.Exampl e: If â€Å"c† dies leaving behind his two sons only, and no female heirs of class I then property of â€Å"C† passes to his sons by survivorship since there are no female relatives like daughter or any other member specified in the class I of first schedule. In case â€Å"C† dies leaving behind two sons and three daughters, then property of â€Å"C† will pass on to his sons and daughters by succession in the following manner. Firstly property of â€Å"C† is divided among â€Å"C† and his two sons. The shares of â€Å"C† and his two sons are C gets one-third and each son one-third. The sons are entitled to the equal share of the property along with the father. But the daughters are entitled to the share in the share of the deceased â€Å"C† along with other sons.So the sons will get one-third of the property and a share, which is one-fifth in the share of deceased â€Å"C†. Even under the Hindu Succession Act, 1956 the d aughter does not take equal share with the son. The law by excluding daughter from participating in the coparcenary ownership not only contributes to her discrimination on the ground of gender but also has led to oppression and negation of her fundamental right of equality guaranteed in the Constitution having regard to the need to render social justice to women. HINDU SUCCESSION (AMENDMENT) ACT, 2005 W. R. T SECTION 6 Considering the Principle of Equality under The Constitution, Hindu Succession (Amendment) Act, 2005 came up.According to amendment, the daughter of a coparcener shall- 1) By birth become a coparcenary in her own right in the same manner as the son; 2) Have same rights in the coparcenary as she would have had if she had been a son; 3) Be subject to same liabilities in respect of the said coparcenary property as that of a son, 4) She is allotted the same share in property as that to son. And any reference to Hindu Mitakshara coparcener shall be deemed to include a refe rence to a daughter of a coparcener. Now the mode of devolution is no more survivorship but has become succession. This is a drastic amendment, which has changed the whole scenario. Now women are not anyway unequal to men. This is a step taken to bring them at par with men in this society. NEW COPARCENARY UNDER STATE ACTSThe concept of the Mitakshara coparcenary property retained under Section 6 of the Hindu Succession Act has not been amended ever since its enactment. But, five states in India namely, Kerela, Andhra Pradesh, Tamil Nadu, Maharashtra and Karnataka[11] have taken cognizance of the situation an have made necessary amendments. As per the law of four of these states,   (Kerela excluded), in a joint Hindu family governed by Mitakshara law, the daughter of a coparcener shall by birth become a coparcener in her own right in the same manner as the son. Kerela, however, has gone one step further and abolished the right to claim any interest in any property of an ancestor du ring his or her lifetime founded on the mere fact that he or she was born in the family.In fact, the Kerela Act has abolished the Joint Hindu family system altogether including the Mitakshara, Marumakkattayam, Aliyasantana and Nambudri systems. In Kerela the joint tenants has been replaced by tenants in common. The approach of the Andhra Pradesh, Tamil Nadu, Maharashtra and Karnataka state legislatures is, strikingly different from that of Kerela and these states instead of abolishing the right by birth strengthened it, while broadly removing the gender discrimination inherent in Mitakshara coparcenary. The broad features of the legislations are more or less couched in the same language. The State enactments in these four states provide that— a) the daughter of a coparcener in a Joint Hindu Family governed by Mitakshara law, shall become a coparcener by birth in her own right in the same manner as the son and have similar rights in the coparcenary property and be subject to s imilar liabilities and disabilities; (b) On partition of a joint Hindu family of the coparcenary property, she will be allotted a share equal to that of a son. The share of the predeceased son or a predeceased daughter on such partition would be allotted to the surviving children of such predeceased son or predeceased daughter, if alive at the time of the partition. (c) This property shall be held by her with the incidents of coparcenary ownership and shall be regarded as property capable of being disposed of by her by will or other testamentary disposition. (d) The state enactments are prospective in nature and do not apply to a daughter who is married prior to, or to a partition which has been effected before the commencement of the Act.In Kerela Section 4 (i)[12]of the Kerela Joint Family System (Abolition) Act, lays down that all the members of a Mitakshara Coparcenary will hold the property as tenants in common on the day the Act comes into force as if a partition had taken pla ce and each holding his or her share separately. But the major criticism against the Kerela model is that if the Joint family was abolished today in the other states then a deemed partition would take place and women not being coparceners would get nothing more. Whereas if they are made coparceners, then they become equal sharers. WOMEN AS KARTA The law commission has rightly observed that although the Hindu Succession (State Amendment) Acts have conferred upon the daughter of a coparcener status but there is still reluctance to making her a Karta.This is because of the general male view that she is incapable of managing the properties or running the business and is generally susceptible to the influence of her husband and his family, if married. This seems to be patently unfair as women are proving themselves equal to any task and if women are influenced by their husbands and their families, men are no less influenced by their wives and their families. If women can act as coparcena ries then they must also be given the powers of Karta. The shastra is clear that in the absence of senior member a junior member (if he has reached the age of legal competence) may incur debts for the needs of the family, and in the absence of a male member a female member may do so[13].The Sanskrit texts empower women to act, as Karta in instances like when the husband is away or missing or the son is yet to attain majority. Various texts go to prove that the ‘women in defacto is independent; as soon as her husband returns or her son attains majority she becomes dependant, but meanwhile the responsibility rests with her, and the powers should be obviously be allowed to her accordingly’. [14] It is ridiculous to contend that a lady may be fit to be a High Court Judge she is not entitled to exercise within her own family the discretion that a manager can exercise. [15]  Ã‚   JUDICIAL INTERPRETATION There are conflicting opinions of the various High Courts on the questi on of women coparcenary and thus a Karta.The matter for the first time came up before a full Judge Bench of the Nagpur High Court in Kesheo v Jagannath[16] where it was held that â€Å"any adult member may be the manager of the joint family, and in case of a need a step mother could bind her step son, who was a minor, by alienation of the joint Hindu family property in whatever character she purported to act†. The next case that dealt with this problem was Hanooman Prasad’s Case[17] where the powers of the widow mother as a manager of the property of her minor son was discussed. The Court in this case held that â€Å"the test of the lady’s act was not who she was or in what capacity she purported to act? But whether the act was necessary or the minor’s interest as understood by law†.The same view was followed in Pandurang Dohke v Pandurang Garle[18], where the widowed mother passed a promissory note for necessity, as a guardian of her two minor son s. She was a defacto manager and was held to have the managerial powers and the sons could not repudiate the debt. The view of female being the manager of the Joint Hindu family was further strengthened when the Woman’s Right to Property Act, 1937 was passed, which made the widow the owner of the coparcenary interest. But the Madras High Court in- Seethabai v Narasimha[19] gave a contrary decision. In this case the widows claimed that they were the undivided members of the coparcenary by virtue of the operation of the Act of 1937, they objected to the appointment of the guardian for the property of the minor sons.The Court appointed one widow, as the guardian of one minor and a stranger was appointed as the guardian of the other. None of the widows, it was held could be the manager. It was held that to be a manager one must be a pukka coparcener, a male with a birth right and not a mere statutory interest. This decision took a step back and adversely affected the position of women. The similar strand of thought was followed in Mayuri Padhano v Lokananidhi Lingaraj[20] where it was held that a mother, when the husband is alive, couldn’t be a manager. She might indeed act as a guardian of her son, if her husband was dead and perhaps act as a defacto guardian. But as a manager she had no power whatsoever.The principle that a woman could be a manager was decisively rejected. The High Court of Patna has asserted the same view in Sheogulam v Kishan Choudhuri[21], it was denied that a mother of a minor son, during the long absence of her husband might act as a ‘Karta’ and incur debts for family purposes and further that such loans would not be binding up on the family. The matter finally came up before the Hon’ble Supreme Court in Commissioner of I. T. v Seth Govindram Sugar Mills[22], where it upheld the view taken by the Madras High Court and has overruled the decision of Nagpur High Court as they felt that it was contrary to the e stablished rules in the dharmashashtras. SUCCESSION TO PROPERTY OF FEMALE HINDUFor the first time in the Indian History U/S 14 of the Hindu Succession Act 1956, female Hindu is given absolute ownership over the property acquired by Will, sale or by any other lawful means. So far as succession to property of female Hindu is concerned the daughter, son, and the husband takes equal share by succession, which means while she is living no member can demand partition of the property. She can dispose the property either by will or by sale, if she dies without disposing the property then members gets right to inherit the property by succession. Section 15 of the Hindu Succession Act deals with the devolution of the property owned by Hindu female.If the Hindu female has inherited any property from her father or mother, such property devolves upon the heirs of her father, if there are no legal heirs, which are specified in Section 15, like son, daughter, children of predeceased son or daughte r. Likewise if the Hindu female has inherited any property from her husband or father in law, such property will devolve on the heirs of her husband if there no legal heirs like son, daughter, and children of predeceased son or daughter. DWELLING HOUSE But in case of dwelling house, the daughter U/S 23 of the Hindu Succession Act 1956, cannot claim any share by partition until male members choose to divide the share in the dwelling house. In case the daughter is unmarried, she is entitled to a right of residence there in.The daughter may loose her right to share in the property in any of the following circumstances: Section (26) – if daughter ceases to be a Hindu by converting to another religion. Section (25) – if daughter commits murder or abets the commission of murder of a person whose property she could have inherited. However she will not be disqualified to inherit the property only by reason of any disease, defect or deformity. PROBLEMS BY GIVING COPARCENARY RIG HTS TO WOMEN 1) Male members of the coparcenary oppose the giving of coparcenary rights to women as they are the one who manage the property. 2) Women after marriage have to change their family relations and they support their husbands in amily matters, which is quite unsatisfactory for the maternal family members. CONCLUSION There will no doubt be opposition in implementation. In fact, the land fragmentation and joint family stability arguments go back to the 1940s when the Hindu Code was being debated. Changing social attitudes takes time. Legal awareness will require a campaign too. But legal reform is also important in and of itself since it reflects our vision of the kind of society we want. BIBLIOGRAPHY 1) Deewan Paras, Family Law, Allahabad Law agency 6 ed. 2) www. google. com 3) www. yahoo. com ———————– [1] Mulla, Principles of Hindu Law 17th ed by S. A. Desai, p. 168. (1998) [2] Ibid. 3] Article 38(2) – The Stat e shall strive to minimize the inequalities in income, and endeavor to eliminate inequalities in status, facilities and opportunities, not only among individuals but also amongst groups of people residing in different or engaged in different vocations. [4] AIR 1952 Bom 84. [5] AIR 1965 SC 314. [6] (1981) 3 SCC 689. [7]Seervai, H. M, Constitutional Law of India 4th edn. , p 677 (1991). [8] The Constituent Assembly of India (Legislative) Debates Vol. VI 1949 Part II. [9] Ibid [10] Law Commission of India 174th report on ‘Property Rights of Women: Proposed Reforms under the Hindu Law’, May 2000. [11] The Kerela Joint Family System (Abolition) Act, 1975; The Hindu Succession (Andhra Pradesh Amendment)Act, 1986; The Hindu Succession (Tamil Nadu Amendment)Act, 1989; The Hindu Succession (Maharashtra Amendment)Act, 1994; The Hindu Succession (Karnataka Amendment) Act, 1994 12] The Kerela Joint Family System (Abolition) Act, 1975- S (4) Joint tenancy  to be replaced by tenanc y in common —  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚     Ã‚   (1) All members  of  an  undivided  Hindu family  governed  by  the  Mitakshara law holding any coparcenary property  on  the day this Act comes into force shall with effect from that day, be deemed   to   hold it as tenants-in-common as if a partition had   taken place among all the members of that undivided Hindu family   as   respects such   property and as if each one of them is holding his or her share separately as full owner thereof; Provided that nothing in this sub-section shall affect the right to maintenance  or the right to marriage or funeral expenses out  of  the  coparcenary property or the right   to   residence,   if   any,   if  Ã‚   the members   of   an   undivided   Hindu family, other   than   persons   who  Ã‚   have  Ã‚   become entitled to hold their shares separately, &   any such right can be enforced if this Act had not been passed. 2) All members of a joint Hindu family, other than an undivided Hindu family referred to in sub-section (1), holding any joint family property on the day of this Act comes into force, shall, with effect from that day be deemed to hold it as tenants-in-common, as if a partition of such property per capita had taken place among all the members of the family living on the day aforesaid, whether such members were entitled to claim such partition or not under the law applicable to them, and as i. e. each one of the members is holding his or her share separately as full owner thereof. [13] 17 Derret, J Duncan, â€Å"May a Hindu Women be the Manager of a Joint Family at Mitakshara Law†, Bom. L. R.. , J. ,   p. 42. [14] Derret, J Duncan, â€Å"May a Hindu Women be the Manager of a Joint Family at Mitakshara Law†, Bom. L. R.. , J. ,   p. 42. [15] Derrett, J Duncan, ‘A critique of Modern Hindu Law’, 1st edn. , NM Tripathi Pvt Ltd, Bomba y (1970). [16] [1926] AIR Nag. 81 [17]Hanooman Prasad Pandey V. Musumoot Baboee (1856) [18] [1947] AIR Nag. 178 [19] AIR 1945 Mad. 306 [20] [1956] AIR Ori. 1. [21] [1961] AIR Pat. 212. [22] AIR 1966 SC 24.

Mercalli Earthquake Intensity Scale

The Modified Mercalli Intensity Scale of 1931 is the basis for the U.S. evaluation of seismic intensity. Intensity is different than the  magnitude in that it is based on observations of the effects and damage of an earthquake, not on scientific  measurements. This means that an earthquake may have different intensities from place to place, but it will only have one magnitude. In simplified terms,  magnitude measures how big  an earthquake is while intensity measures how bad  it is. The Mercalli Scale The Mercalli scale has 12 divisions, using Roman numerals from I to XII. I. Not felt except by a very few under especially favorable circumstances.II. Felt only by a few persons at rest, especially on upper floors of buildings. Delicately suspended objects may swing.III. Felt quite noticeably indoors, especially on upper floors of buildings, but many people do not recognize it as an earthquake. Standing motorcars may rock slightly. Vibration like passing truck. Duration estimated.IV. During the day felt indoors by many, outdoors by few. At night some awakened. Dishes, windows, and doors disturbed; walls make a creaking sound. Sensation like heavy truck striking building. Standing motorcars rock noticeably.V. Felt by nearly everyone; many awakened. Some dishes, windows, etc., broken; a few instances of cracked plaster; unstable objects overturned. Disturbance of trees, poles, and other tall objects sometimes noticed. Pendulum clocks may stop.VI. Felt by all; many frightened and run outdoors. Some heavy furniture moved; a few instances of fallen plaster or damaged chimneys. Damage slight.VII. Everybody runs outdoors. Damage negligible in buildings of good design and construction slight to moderate in well built ordinary structures; considerable in poorly built or badly designed structures. Some chimneys broken. Noticed by persons driving motor cars.VIII. Damage slight in specially designed structures; considerable in ordinary substantial buildings, with partial collapse; great in poorly built structures. Panel walls thrown out of frame structures. Fall of chimneys, factory stacks, columns, monuments, walls. Heavy furniture overturned. Sand and mud ejected in small amounts. Changes in well water. Persons driving motor cars disturbed.IX. Damage considerable in specially designed structures; well-designed frame structures thrown out of plumb; great in substantial buildings, with partial collapse. Buildings shifted off foundations. The ground cracked conspicuously. Underground pipes broken.X. Some well-built wooden structures destroyed; m ost masonry and frame structures destroyed with foundations; ground badly cracked. Rails bent. Landslides considerable from river banks and steep slopes. Shifted sand and mud. Water splashed over banks.XI. Few, if any (masonry), structures remain standing. Bridges destroyed. Broad fissures in ground. Underground pipelines completely out of service. Earth slumps and landslips in soft ground. Rails bent greatly.XII. Damage total. Waves seen on ground surfaces. Lines of sight and level distorted. Objects ​thrown upward into the air. From Harry O. Wood and Frank Neumann, in Bulletin of the Seismological Society of America, vol. 21, no. 4, December 1931. Although the correlation between magnitude and intensity is weak, the USGS has made a pretty good estimate of the intensity that might be felt near the epicenter of an earthquake of a specific magnitude. It is important to reiterate that these relationships are by no means precise: Magnitude Typical Mercalli Intensity Felt Near Epicenter 1.0 - 3.0 I 3.0 - 3.9 II - III 4.0 - 4.9 IV - V 5.0 - 5.9 VI - VII 6.0 - 6.9 VII - IX 7.0 and greater VIII and greater

Condominium Assessments The Lifeblood Of The Any...

Condominium assessments are the lifeblood of the any condominium association. A condominium association cannot function and provide essential services to co-owners unless assessments are collected. Unfortunately, dissatisfied co-owners often threaten to withhold assessments as a means to get what they want. Examples of situations where co-owners commonly threaten to withhold assessments and/or withhold assessments are as follows: 1. A co-owner has suffered damage to their unit and/or the appurtenant common elements and the condominium association has not responded as quickly as the co-owner desires. 2. A co-owner has suffered damage to their unit and/or the appurtenant common elements and the co-owner is not satisfied with the quality of repairs. 3. A co-owner is under the mistaken belief that they are a tenant and that they are allowed to deduct the costs of repairs and make repairs as set forth in Rome v Walker, 38 Mich App 458, 196 NW 2d 850 (1972). http://www.leagle.com/decision/197249638MichApp458_1348/ROME%20v.%20WALKER 4. A co-owner withholds assessments on the basis that they are dissatisfied with accounting practices and/or financial decisions made by the board of directors. 5. A co-owner is dissatisfied with the board of directors and withholds payment for political reasons and/or encourages other co-owners not to pay assessments. While a co-owner may believe that they are justified in withholding assessments for the above reasons, or other reasons,Show MoreRelatedMarketing and Financial Markets41809 Words   |  168 Pagesbuyers’ reactions to the firm’s marketing mix. Understanding the Marketing Concept Individuals and organizations engage in marketing to facilitate exchanges, the provision or transfer of goods, services, or ideas in return for something of value. Any product (good, service, or even idea) may be involved in a marketing exchange. We assume only that individuals and organizations expect to gain a reward in excess of the costs incurred. For an exchange to take place, four conditions must exist.