iinvestmnent avanues
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Transcript of iinvestmnent avanues
In our article today, I will try to list the different types of investment
avenues available in India where investors can put in their money.
The figure shown below is pretty self-explanatory. However, I will quickly
explain the specifics.
Indians can invest broadly into five categories of investments – Equity,
Debt, Real Estate, Commodities and Miscellaneous.
Please note that though insurance should not be considered an investment
avenue, in the Indian context, we still use it as a long term savings tool –
hence the inclusion of insurance below.
Figure below explains all the investment options available. Click on the
figure to open a bigger size image in a new window.
Equity Please note that investments in equity should only be done for the long term (anything more than 5 years) to earn decent returns. Risk of investing in equities is high and so the returns are also high. You could dabble in the stock market broadly in three ways.
1. Directly by buying and selling shares on the stock exchanges BSE/NSE2. Take the plunge via the Mutual Fund route – wherein the options available
are : equity diversified, balanced, tax saving ELSS funds, thematic, exchange traded or index funds
3. Investing in ULIPs(insurance plans) via their equity funds.
DebtDebt investment can be done for the short term and long term as well. Risk
here is very low and so return is low as well. Investing in debt can be done
by the following ways.
1. Fixed Deposits, POMIS, NSC, PPF, NPS, Bonds, Kisan Vikas Patra, Senior Citizen Saving Schemes
2. Debt mutual funds (balanced, floating rate, gilt, liquid and liquid plus) also offer another way to do so.
3. Traditional insurance policies (money back, whole life, endowment) and the debt portions of ULIPs can be a mechanism as well.
Real EstateThis is again for the long term with a high risk and very low liquidity factor.
Liquidity is defined as the ease with which you could sell your investment
for cash quickly. Investing in property can be done by :1. Buying apartments and plots in either residential or commercial areas2. Or buying Real Estate Mutual Funds.
Commodities For small investors, exposure to gold is the right step to invest into
commodities. The risk is moderate/high in this class of investment and it is
highly volatile as well.1. One could buy gold and silver bars/coins or jewellery and2. Invest in Gold exchange traded mutual funds.
ArtInvestment into Arts is not every small investor’s first dream but having
invested into the first four, one could think of putting their money into art as
well. This should be on less priority as compared to the above four.
These broadly define the options available with investors for investing their
hard earned money.- See more at: http://www.thewealthwisher.com/2010/06/23/investment-avenues-for-indian-investors/#sthash.v4WGUToG.dpuf
Project on Investment Avenues in India
The project “Investment Avenues in India” gives a brief idea regarding the various investment options
that are prevailing in the financial markets in India. With lots of investment options like banks, Fixed
Deposits, Government bonds, stock market, real estate, gold and mutual funds the common investor
ends up more confused than ever. Each and every investment option has its own merits and demerits.
Any investor before investing should take into consideration the safety, liquidity, returns, entry/exit
barriers and tax efficiency parameters. We need to evaluate each investment option on the above-
mentioned basis and then invest. Today an investor faces too much confusion in analyzing the
various investment options available and then selecting the best suitable one. In the present project,
investment options are compared on the basis of returns as well as on the parameters like safety,
liquidity, term holding etc. thus assisting the investor as a guide for investment purpose.
The primary objective of the project is to make an analysis of various investment decisions. The aim
is to compare the returns given by various investment decisions. To cater the different needs of
investor, these options are also compared on the basis of various parameters like safety, liquidity,
risk, entry/exit barriers, etc.
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