Best Investments To Invest Your Money in FY 2021

investments

When the question is about choosing the best investments, there are many aspects to be considered by an investor such as risk and reward factor, investor’s expectation from investment, their risk profile, liquidity concern and investment horizon.

What is investment, different types of investments and how one can make the right financial decisions to maximize returns are also some of the basic questions an investor may ask before making an investment. Here are the answers.

An investment is categorised as financial and non-financial assets with the objective of generating income or creating wealth by increasing its value over time. Time and amount always affect the decision of choosing an investment type. Investments can be ownership/capital market investments like stocks, real estate etc, lending investments like bonds, savings account etc, money market instruments like certificate of deposits etc.

Investors can understand it as market-linked products and fixed income products. Market-linked products are stocks, mutual funds etc and non-financial products are Public Provident Fund, fixed deposits etc. Non-financial options are physical gold and real estate.

Following are some of the investments to invest in FY 2021:

1.  Initial Public Offer (IPO)

IPO is the opportunity to get fresh stock at the lowest possible price. The IPO market is set to make records on major IPOs in 2021. Insurance Corporation of India (LIC) IPO has already been announced in the Union Budget. More than 15 IPOs are lined up this year. Other major upcoming IPOs are Kalyan Jewellers, Bajaj Energy, Barbeque Nation, Paytm. Keep an eye on daily updates of the stock market to grab the opportunity.

2.  Direct Equities

Investing in equity shares is rewarding for risk-takers. An investor must have adequate knowledge of the stock markets and risk tolerating appetite. Researching and educating themselves is the constant process to invest in the stock market. The best part of direct equities is that they deliver higher returns that can beat inflation in the long run. You can buy and sell stocks anytime as per requirements.

3.  Company Fixed Deposits

Even in the pandemic era, company fixed deposits are equally popular among risk-averse investors. Company FDs offer higher interest rates comparatively. Ensure security of your funds through investing in FDs and earn a regular income with the non-cumulative FD product. It is preferred by senior citizens because of the easy online FD account facility and the additional interest rate advantage on senior citizen FDs. Fixed deposit rates in India are lucrative. Investors can earn interest rates up to 7.25% depending on the category of investor, investment amount and tenor. Apart from high FD rates, Bajaj Finance FD also offers additional benefits such as flexibility to choose tenor, frequency of periodic interest payouts, multi-deposit facility, loan against FD and much more.

4.  Equity mutual funds

Equity mutual funds pool funds and invest in equity stocks as per the directions of market regulator Securities and Exchange Board of India (Sebi). Minimum 65% of your funds will be invested in equity and equity-related instruments like index funds and exchange-traded funds (ETFs). Fund managers can invest in stocks of only Indian companies or overseas companies.

5.  Debt mutual funds

Debt mutual funds can be chosen by investors looking for steady returns. These are the investments in money market instruments offering fixed-interest rates like corporate bonds, government securities, T-bills, commercial paper etc. They are less risky as compared to equity funds because of less volatility. Investors are suggested to know about risks associated with mutual funds.

These are some of the best investment avenues. Company FDs like Bajaj Finance FDs are less risky among these.

Following are the steps to choose the best investment avenues:

  1. Financial needs and objectives of the investor
  2. Know your timeline to make an investment
  3. Determine your Risk-Profile
  4. Make an investment plan
  5. Determine Investment Cost
  6. Diversify investment portfolios because greater rewards are the result of diversification.

You can list down the investments to avoid as well. Review your investment plan periodically so that you know it is aligned to fulfil your financial objectives or not.

Hi i am Ahmad , I love to write about Heath, Tech, Business, Automobile

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