Top 10 investment options in India that you must know about
24th January 2019
As a person who is concerned about the financial health and wellbeing of your loved ones, you are always on the lookout for a safe and healthy investment option. A healthy investment option is one which allows you to weigh your risks, needs and is flexible when it comes to the terms and maturity benefits. Given the fact the risk and investment benefit seem to be directly proportional (i.e. higher the risk, higher the benefit), it must be noted that there is no such thing as a zero-risk investment. Any investment comes with a certain degree of calculated risk. Here are top 10 investment options in India that you must know about:
- Direct Equity: Investing in stocks may not be everyone's cup of tea as it's a volatile asset class and there is no guarantee of returns. Further, not only is it difficult to pick the right stock, timing your entry and exit is also not easy. The only silver lining is that over long periods, equity has been able to deliver higher than inflation-adjusted returns compared to all other asset classes.
- Equity Mutual Funds: Equity mutual funds predominantly invest in equity stocks. As per current Securities and Exchange Board of India (SEBI) Mutual Fund Regulations, an equity mutual fund scheme must invest at least 65 percent of its assets in equities and equity-related instruments. An equity fund can be actively managed or passively managed.
- National Pension Scheme (NPS): National Pension Scheme (NPS), a government-sponsored pension scheme was launched in January 2004, initially for government employees, before being opened to all sections in 2009. An NPS subscriber can contribute regularly in a pension account, can withdraw a part of the corpus in a lump sum and can use the rest of the corpus to buy an annuity product after retirement.
- Public Provident Fund (PPF): One of the most widely used and popular investment schemes in India is the PPF. It has a long tenure of 15 years and makes for a safe investment.
- Debt Mutual Funds: This option is mainly used by investors who want steady benefits/returns. Debt mutual funds primarily invest in fixed-interest generating securities like corporate bonds, government securities, treasury bills, commercial paper and other money market instruments.
- Bank FD (Fixed Deposits): In India, a bank FD is a safe and traditional investment option that is used by most people. Each depositor in a bank is insured up to a maximum of Rs 1 lac for both principal and interest amount. As per the need, one may opt for monthly, quarterly, half-yearly, yearly or cumulative interest option in them.
- Senior Citizen’s Saving Scheme (SCSS): Preferred by most retirees or senior citizens, SCSSs can be availed of through any post office. As the name suggest, a person has to be above the age of 60 years to avail it.
- Gold: Gold investment remains one of the most traditional and hugely popular investment options in India.
- Real Estate: Talking about traditional investment schemes, trading in real estate in also popular. Considered to be highly valued on account of the booming infrastructure market of India, real estate is a further diversified field and rates fluctuate as per market demands.
- RBI Taxable Bonds: These bonds, issued in a demat form, are credited to an investor’s BLA (Bond Ledger Account) and come with a tenure of 7 years.
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