What is Investment?
Investment is a technique of building wealth by setting aside some money to obtain additional income or profit over time. When you invest your money in smart investment options, you can ensure its steady growth.
Starting investments based on your long or short-term plans, can help you meet your financial goals easily. You must chalk out a proper plan to tie up every investment with your goal, so you can easily fulfil them.
When you start investing early, you can reap the benefits of compounding returns, which keep increasing over time. With a handsome fund at your hand you don't miss out on awesome investing opportunities
You can invest smartly to grow your corpus, & accumulate savings to grow over time. By setting aside a sum of money for retirement, you can ensure that you cater to your regular expenses and secure your future.
Top 10 Best Investment Options with High Returns
In today’s world, earning money may not be enough to fulfil 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.
Though there are so many investment options available, making the right choice may get overwhelming. To help you decide the best investment options to consider, here’s a rundown on different types of investments and their returns.
Investors usually take investment decisions, based on their risk appetite.
Thus, these investments are classified into different risk levels, which include low risk, medium risk and high risk. Here’s a look at these investment options in detail:
Low Risk Investment
These are instruments which pay fixed income – irrespective of the changes in the business or economy. Bonds, debentures and Fixed Deposit fall under this category. Also, special investment vehicles – PPF, EPF, SCSS, Sukanya Samriddhi, National Savings Scheme and other small Post Office Schemes which are created by a government statute for specific purposes are low risk as they guarantee the returns. The returns are periodic and pre-determined.
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 liquidity.
Medium Risk Investment
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.
Best Investment Options in India
Here are few investment options Indians look at while savings for their financial goals