Today I would like to tell about good investment plans, now we see what is an investment? In today’s world, earning money may not be enough to fulfill your financial goals and take your dreams towards fruition. Instead of letting your hard-earned money lie idle in your bank accounts, you may consider investing in investment options such as stocks, equities, mutual funds, Fixed Deposit, or more.
Investments are three types they are:
Low-risk investments: Low-risk investments are not linked to the stock market movements and are usually governed by the interest rate movements of the financiers. However, there is always the returns are always guaranteed.Government bonds and life insurance policies provide good returns, however, they have long lock-in periods. So, you will have to wait for a long time to earn substantial returns from these investment options. Fixed Deposit is one of the very few low-risk investments that offer stable, high returns and immediate liquidit.
Medium risk investments:These are investments which might have a certain percentage of risk but these also pay higher returns to investors willing to invest in them. Debt funds, balanced mutual funds, and index funds fall in this category. Such instruments do have an element of debt and stability, but they have their volatility linked to the markets which can hamper your principal amount. The irregularity in earnings can make any fixed income from such investment impossible
High risk investment:These are investments where there is no limit to the upside along with the downside of risk-returns. These are stocks of companies, equity mutual funds, even stocks, and derivatives. The return on these instruments can give huge returns as well as chances of losses depending on various external factors to the company and internal ones. The quantity and timing of returns on these instruments are not fixed. Hence, they are at high risk
Different investment options:
- Direct equity
- Equity mutual funds
- Debt mutual funds
- National pension system(NPS)
- Public Provident fund(ppf)
- Bank fixed deposit(FD)
- Senior citizens saving scheme
- Pradhana mantri Avaya bandana yojana
- Real estate
- Gold
What you should do
Some of the above investments are fixed-income while others are financial market-linked. Both fixed-income and market-linked investments have a role to play in the process of wealth creation. Market-linked investments offer the potential of high returns but also carry high risks. Fixed income investments help in preserving the accumulated wealth so as to meet the desired goal. For long-term goals, it is important to make the best use of both worlds. Have a judicious mix of investments keeping risk, taxation and time horizon in mind.
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