India is a country with a population still having a strong belief in saving money. Yet lately things have changed. But money doesn’t have just two roles, i.e., to earn and to be spent but also has a third crucial role, i.e., to invest. Indians, on the other hand, have a huge population which is unaware of the various opportunities from where they can earn money from money. As per a few research, only about 1.2 %-1.5 % of Indians have a de-mat account and are direct investors in the stock market and only about 2% in the equity market.
Due to this approach of the population here, India doesn’t seem to be an interesting investment market to people from other countries. The reality is that Indian market provides everything that any favorable investment market can. All that’s mainly required is an exposure and knowledge to the population about the various investment options.
Major Investment Areas In 2017
- Public Provident Fund (PPF)
- Mutual Funds
- Equity Shares
- Real Estate Investment
- Post Office monthly income account
- Company Fixed Deposits
- Initial public offerings
The above-mentioned options have a different rate of return, different clauses regarding the maximum and minimum amount that can have, risk, etc. For investment advice, people may need a broker. A stock broker is a person who buys or sells stock for their client. According to a person’s knowledge about the market the need for a broker increases or decreases. But what is more important is to choose the right broker for which you need to know about various brokers, how they work, and compare brokerage.
Investments can be divided into two types one is short term and the other is long term. Long term investments where need a lot of patience and there is no instant return yet they are better because the benefits get compounded and are more tax efficient. They give superior returns in comparison to short-term investment.
Best Long Term Investments Options in India In 2017
Gold – With its amazing trend to triple its value in past 10 years, it becomes the best investment option. It had a return value of 9% in dollar terms last year. Gold is said to be a safe haven in investor’s terminology.
PPF and EPF – Public Provident Fund and Employee Provident Fund with a return of 7.8% is a safe bet for investors and also have tax benefits. It also helps to build a corpse amount for retirement. Though it has its own flaw of having a lock-in period during which money cannot be drawn out.
Stocks – With huge but no fixed return, stocks require a great risk appetite and good market knowledge. Though stocks give multiplied returns they require a lot of patience, risk taking ability and a good portfolio of stocks. Though risk capacity is a personal affair, the portfolio management can be taken care of by stock brokers. They need to compare brokerage so that they get a good return even after paying to brokers.
Mutual Funds – To balance the risk and return one can invest in equities and bonds or go for Systematic Investment Plan (SIP).
Real Estate – People with huge cash to invest can invest in real estate. This option is great as it’s risk-free, the land prices are going up day by day and have fewer chances of decrement in near future.