When we talk about investment you may think that it is something which is meant only for wealthy and old folks, or for those who are further along in their careers when compared to you. But in reality, this is not the fact. Investment is an integral part of one’s financial journey and is not limited to a particular sector of the society.
Investment is one of the best ways for saving money and growing it as well, thus helping you in maintaining a healthy financial life. Investment is a very broad term and can be further classified into various different segments. The term investment may conjure an image of the BSE in your mind, but that is only a type of investment.
There are various investment options available in the market and are accessible to everyone regardless of your age, career or income. However, these factors play a key role in figuring out the perfect investment product for you at any given point of time.
Risk profile analysis is another factor which plays a key role in determining the perfect investment for you. For example, when you are young you can invest in high risk instruments which offer higher returns as well, but the same cannot be the case with someone who is inching towards their retirement.
Let us discuss about some of the best investment options for consideration.
So, without further ado, let us discuss about each one of these in detail and help you figure out the best investment options for your needs.
1. Savings Account
This is probably amongst the most common and a safe investment option available. Every nationalized and private bank offers you some interest for your funds parked in the account you hold with the bank. These interest rates often vary depending on the Repo and Reverse Repo rates fixed by the Reserve Bank of India. This is one of the most preferred investment options in India.
Savings account are usually a safe haven for investment; however, it must be noted that there exists no investment option which is 100 per cent safe. Bank default is one of the risks which are associated with this investment. You can even park your funds in a fixed deposit with your bank and earn better interest rates as compared to savings account. But the liquidity in case of FDs is low when compared to savings account. Savings account are also one of the most liquid investment options available.
2. Mutual Funds
Mutual funds have been around us for many years, but they have been into limelight in the recent times. These funds pool money from multiple investors and invest it into different assets ranging from stocks, commodities, bonds etc. If you don’t want to invest lumpsum amount, you can even invest the same in parts known as Systematic Investment Plan or SIP. There are multiple mutual funds available in the market, and you can choose one, depending on the asset class it is investing and the past performance data.
These funds are usually preferred for long terms because the magic of compounding works in the case of them. If you are aiming for a short-term investment, mutual funds are not for you. Mutual funds are dependent on market performance and thus have a risk factor associated with them as well. Therefore, risk profile analysis will help you choose a perfect mutual fund based on your risk bearing capacity.
3. Stocks
Investments and stocks usually go hand in hand. Stocks are one of the most lucrative options when it comes to investments. You can invest in stocks for long term, short term or even trade intraday. There is no minimum investment required and risk to reward ratio in case of stocks is also very high. Everyday millions of investors try their hands-on stocks to earn some decent profits.
However, it must be noted that investing in the stocks is not easy and requires proper research and knowledge. Choosing the perfect set of stocks based on your investment horizon, goal and risk profile is not possible without research. Market Neuron is a product which has a bouquet of stocks for your investment needs which are selected based on fundamental research. Stocks also offer good liquidity to the investors.
4. Gold
When it comes to Indian investors, Gold enjoys a cult following from them. This yellow metal is the favorite investment option for almost every Indian household because of the high liquidity. You can invest in Gold by buying physical gold or through Gold ETFs.
Investing in physical gold always has the risk of safe storage associated with it. This shiny metal is highly prone to thefts and robberies. However, investing in Gold through ETFs or Exchange Traded Funds allows you to invest in Gold but without the risk of safe storage. You can get detailed information about investing in Gold here.
5. Real Estate
Investing in Real Estate can also be considered as a safe investment option, but it usually requires where high investment capital. Also, real estate has the lowest liquidity across all the investment options we have discussed. If you are planning for a long-term investment and have high investment capital, you can consider this option.
Appreciation in value and rent are two of the most common returns that you can expect from your real estate investments. It must also be noted that your own residential property where you reside cannot be considered as an investment. Any other property which you acquire apart from your own house is an investment.
Conclusion
While these were some of the evergreen investment options available for investors, it must be noted that there is always a risk associated with investment and there is no investment available which can offer only rewards without any risk. Therefore, it is always recommended to get your risk profile analysis before stepping out into the world of investments. It will also help you in choosing the best investment option for you.
Happy Investing!
