Introduction:
An investment is a roadmap for the allocation fund with the expectation of generating returns or future benefits to complete a successful financial journey. In the financial world, it involves the purchase of assets, like stocks, bonds, real estate or other financial instruments, with the aim of achieving financial goals.
The main fundamental goal of investing is to grow wealth and mitigate the impact of inflation. Investors assess various factors, including risk tolerance, time horizon, and financial goals, to make informed decisions about where to allocate their funds. While investments inherently carry some level of risk, prudent strategies involve diversification and careful analysis of market conditions.
In India, there are multiple high return investments options, such as equity, mutual funds, various fix deposits and different category bonds etc. So it becomes mandatory to analyze properly the pros and cons before these investments and select the one of the best plan fit to your requirement while making an investment for wealth growth.
Now, after considering all these, our investment plan should be tailored to our requirements/objectives, avoiding risk. Making an investment is not a one time process, you must focus regularly on it.
1. Methods of Investment Options in India:
All these are classified based on level of risk and potential of returns. Let’s understand in detail every method of investment:
(a) Low risk investment:
Low-risk investments are financial instruments or assets that are considered to have a very nominal or lower probability of loss compared or zero risk. These investments are typically favored by conservative investors who prioritize capital preservation over potential high returns. Such investment offers stable returns, which are almost guaranteed returns. Some of these are fixed deposits, Public Provident Fund, Sukanya Samridhi Yojana and so on. Low risk investments covers the following measures:
(1a.1). Safety of Principal: One of the primary role of low-risk investments is the protection of capital investment. These investments are designed to minimize the chances of significant losses, providing a level of safety for the investor’s principal amount.
(1a.2). Stability and Predictability: Low-risk investments often involve assets or financial instruments with stable and predictable returns.
(1a.3). Lower Returns: While low-risk investments provide a higher degree of safety, they typically come with lower potential returns compared. Investors in low-risk assets are willing to accept modest returns in exchange for reduced exposure to market volatility.
(1a.4). Diversification: Building a diversified portfolio that includes low-risk investments can be a strategy to manage overall risk. Combining assets with different risk profiles helps balance the portfolio and provides a more stable investment experience.
(1a.5). Government Securities: Investments in government-backed securities, such as Treasury bonds or municipal bonds, are often considered low-risk. These securities are backed by the government’s ability to raise funds through taxation or other means, providing a level of security for investors.
(1a.6). Savings Accounts and FDs: Bank products like savings accounts and Fix of Deposit are examples of low-risk investments.
(b) Medium Risk Investments:
Medium-risk investments are those investments that are slightly more riskier than the low risk investments. These fall between low-risk and high-risk options in terms of potential returns and volatility. Most of these seeks to produce good returns while assuming a moderate level of risk. These investments are more appropriate for the balance portfolio. Some its examples are given below:
(1b.1). Corporate Bonds: These debt securities issued by companies offer higher yields than government bonds but come with a moderate level of risk, as they are influenced by the issuing company’s financial health.
(1b.2). Dividend-Paying Stocks: Stocks of established companies that regularly pay dividends can provide a steady income stream. While they are more stable than high-growth stocks, they still carry some market risk.
(1b.3). Real Estate Investment: It allow investors to participate in real estate without the need to own physical properties. They often generate income through rental payments and can provide a balance between income and growth.
(1b.4). Balanced Mutual Funds: These funds typically invest in a mix of stocks and bonds, aiming to achieve a balance between capital appreciation and income generation. They offer diversification, reducing the overall risk of the investment.
(1b.5). Peer-to-Peer Lending: Investing in P2P lending platforms allows individuals to lend money directly to others in exchange for interest payments. While it offers higher returns than traditional savings accounts, where moderate risk is involved.
(c) High Risk Investments:
High-risk investments refer market lined investments that carry significant higher level of risk in compare to above two options. These investments are characterized by their elevated level of volatility, uncertainty, and susceptibility to market fluctuations and gave a high return. While they can be tempting due to the prospect of lucrative gains, investors should approach them with caution and a thorough understanding of the associated risks. The following investments are given below:-
(1c.1). Stocks of Emerging Companies: Shares in newly established or small companies can be highly volatile. While some may experience rapid growth, others may face challenges or even failure.
(1c.2). Options and Futures Trading: Derivatives trading involves contracts that derive their value from an underlying asset. While these instruments can provide significant returns, they also expose investors to substantial losses, especially if market conditions move against their positions.
(1c.3). Venture Capital and Startups: Investing in early-stage companies or venture capital projects carries high risk. While successful ventures can yield substantial returns, many startups fail, leading to significant losses for investors.
(1c.4). High-Yield Bonds or Junk Bonds: Bonds issued by companies with lower credit ratings offer higher interest rates to compensate for the increased risk of default. However, the risk of non-payment is also higher compared to investment-grade bonds.
2. Best Investments Options for Short-Term:
Short-term investment goals are those, which you want to achieve in a year and these requires a different approach compared to long-term investments, focusing on liquidity, safety, and potential returns within a relatively brief timeframe. Here are some of the best investment options for the short term in India.
3. Best Investments Options for Long-Term:
Best long-term investments are required a strategic approach to build wealth and achieve financial goals in the next 7 to 8 years. The following are some of the best investment options for long-term in India:
(a) Direct Equity:
Equity market is a one of the best ways to create wealth for long term. There are numerous examples of stocks that have given multiple returns over a period of time. Even, some stocks have delivered an annualized returns more than 45% in the last 12 to 15 years. The following parameters works in this market:
(3a.1). Eligibility for investment: To enter in this investment, you must have a Demat Account with any broker listed with SEBI (Securities Exchange Board of India).
(3a.2). Investment Amount: There is no minimum or maximum limit to invest in this market.
(3a.3). Maturity Time Period: Direct equity market has no any lock-in period, hence you can redeem or resale your stock at any time during working day.
(3a.3). Taxation & Benefits: Investments made in equity are not eligible for tax deductions. Short term gains taxed @ 15% and long term capital gain upto Rs 1,00,000/- are exempted. However, gain more than one lakh is taxable @ 10%.
(3a.4). Who can invest in Equity: Any person looking to earn market linked return can invest in this market. However, higher risk is involved and requires expertise in stock selection.
(3a.5). Rate of returns: It offers a market linked returns, which you can earn in the form of dividends and capital gain.
5 Stocks which given returns of more than 70% in 10 years
| Ser No. | Stock Name | Price | Market Cap (in Cr) | 1 Yr | 3 Yr | 5 Yr |
| 1 | Aurobindo Pharma | 2367.00 | 5805.64 | 549.20 | 204.79 | 76.55 |
| 2 | Danlwa | 1600.00 | 779.31 | 583.91 | 144.81 | 72.97 |
| 3 | Magellan | 421.00 | 4920.61 | 278.09 | 190.29 | 114.37 |
| 4 | LSIL | 44.35 | 5075.36 | 136.41 | 260.07 | 108.71 |
| 5 | Avantel | 119.20 | 2899.77 | 326.02 | 164.25 | 98.79 |
25 Large Cap Stocks which given returns of more than 20% in 10 years
| Ser No. | Company Name | CPM (in Rs) | PE Ratio | Market Cap (in Cr) | 10 Years Return |
| 1. | Titan | 3820.30 | 102.72 | 339169.97 | 33.23 |
| 2. | Asian Paint | 3296.90 | 62.24 | 316223.43 | 20.96 |
| 3. | Pidilite Inds | 2795.55 | 94.47 | 142223.01 | 25.78 |
| 4. | Bharat Electron | 186.80 | 41.09 | 136546.67 | 33.92 |
| 5. | Britannia Inds | 5130.60 | 55.48 | 123582.28 | 27.60 |
| 6. | TVS Motors | 2033.65 | 66.26 | 96585.27 | 39.89 |
| 7. | Torrent Pharma | 2449.70 | 61.70 | 82858.76 | 26.27 |
| 8. | Berger Paint | 604.45 | 68.16 | 70381.65 | 25.16 |
| 9. | SRF | 2358.15 | 40.33 | 69911.84 | 49.48 |
| 10. | Solar Industries | 6963.35 | 77.94 | 62994.65 | 44.26 |
| 11. | Persistent Sys | 7619.40 | 58.35 | 58546.18 | 31.44 |
| 12. | Abbott India | 25806.50 | 50.71 | 54842.79 | 31.43 |
| 13. | Tata Elxsi | 8604.55 | 68.23 | 53564.26 | 47.07 |
| 14. | PI Industries | 3481.15 | 35.37 | 52903.99 | 31.10 |
| 15. | Supreme | 4162.90 | 51.42 | 52871.11 | 24.31 |
| 16. | Schaeffler | 3319.55 | 56.39 | 52024.71 | 26.24 |
| 17. | Balkrishna Inds | 2606.85 | 48.36 | 50657.72 | 32.37 |
| 18. | Astral | 1794.15 | 88.60 | 48195.71 | 37.80 |
| 19. | APL Apollo Tubes | 1553.75 | 56.14 | 43088.51 | 58.80 |
| 20. | Page Industries | 38261.25 | 83.57 | 42681.49 | 21.52 |
| 21. | Coforge | 6597.00 | 56.16 | 40750.71 | 32.70 |
| 22. | Uno Minda | 700.75 | 54.14 | 40191.20 | 60.26 |
| 23. | AIA Engineering | 3716.00 | 28.83 | 35048.98 | 22.01 |
| 24. | ZF Commercial | 16588.20 | 80.53 | 31462.79 | 24.50 |
| 25. | Indraprastha Gas | 433.80 | 19.21 | 30369.54 | 23.45 |
10 Stocks which given yearly returns of more than 100% (Data till 26 Dec 2023)
| Ser No. | Stock Name | YTD (Yearly Return) |
| 1 | Om Infra | 271% |
| 2 | Patel Engineering | 255% |
| 3 | Innovators Facade Systems | 231% |
| 4 | Neuland Laboratories | 219% |
| 5 | Talbros Automotive Components | 168% |
| 6 | Elecon Engineering | 158% |
| 7 | Precision Camshafts | 148% |
| 8 | Repro India | 140% |
| 9 | Affordable Robotic & Automation | 117% |
| 10 | Atul Auto | 107% |
4. Equity Mutual Funds:
Equity mutual funds are investment vehicles that pool money from various investors to invest primarily in stocks or equities. These funds are managed by professional fund managers, who make decisions regarding the selection and allocation of stocks within the fund’s portfolio. Moreover, in this investment your funds will be diversified and will not be concentrated on just 1 or 2 stocks. However, it is necessary to invest your money in MFs after adequate research only. As a result it will increase your chance of earning higher returns approximately above 30% over the long period. The following are the term conditions for investment in this format:
(4.1). Eligibility for investment: You can invest in MFs through any AMC (Assets Management Company), which are registered with SEBI (Securities Exchange Board of India).
(4.2). Investment Amount: There is no minimum or maximum limit to invest in this MFs, you can start as low as Rs 100/- or can start SIP also.
(4.3). Maturity Time Period: In this market, there is no mandatory locking period, you can redeem anytime, whose payment you will get back in there working days. However, in case of ELSS (Equity Linked Saving Schemes), you can redeem only after three years only.
(4.4). Taxation & Benefits: Equity Mutual Fund investments are not eligible for tax deductions. However, if you have done your investment in ELSS, then STCG (Short Term Capital Gains) will be taxed @ 15% and LTCG (Long Term Capital Gain) will be taxed @ 10% if it above one lakh.
(4.5). Who can invest in Equity MFs: Any person looking to earn market linked return can invest in Equity Mutual Fund market. However, higher risk is involved, where you need expertise advise for selection of right MF.
(4.6). Rate of return: You can earn market linked return approximately above 40% in long term investment. Here are top 10 performing Equity MFs, which can give you high returns in long term:
Here are some popular Equity Funds Categories and their long-term performance as on 08 Jan 2024 (MFs)
NAV & Returns data as on 12 Jan 2024 (Small Cap)
State of Stocks as on 12 Jan 2024 (Small Cap)
| Ser No. | Scheme Name | Crisil Rank | AUM in (Cr) | 1 Yr | 2 Yr | 3 Yr | 5 Yr | 10 Yr |
| 1 | Axis Small Cap Fund (Direct Growth Plan) | 3 | 18,615.72 | 39.16% | 18.57% | 30.47% | 28.70% | 25.58% |
| 2 | Quant Small Cap Fund (Direct Growth Plan) | 3 | 13,001.83 | 55.00% | 27.46% | 46.25% | 35.01% | 20.60% |
| 3 | Union Small Cap Fund (Direct Growth Plan) | 3 | 1,285.94 | 47.90% | 18.80% | 32.05% | 26.73% | – |
| 4 | Tata Small Cap Fund (Direct Growth Plan) | 4 | 5,819.07 | 40.07% | 22.47% | 37.82% | 28.54% | – |
| 5 | LIC Small Cap Fund (Direct Growth Plan) | 2 | 193.61 | 39.55% | 17.27% | 32.03% | 23.01% | – |
| 6 | Sundaram Small Cap Fund (Direct Growth Plan) |
3 |
3,007.86 | 49.10% | 19.61% | 32.33% | 23.78% | 22.54% |
Top MFs Schemes of Mid Cap based on last 5 years returns (Jan 2024)
| Ser No. | Scheme Name | AUM in (Cr) | 1 Yr | 3 Yr | 5 Yr |
| 1 | Nippon India Mid-Cap (Direct Plan-Growth) | 23,495.00 | 65.48% | 32.92% | 31.97% |
| 2 | Mahindra Manulife Mid-Cap (Direct Plan-Growth) | 1903.00 | 64.05% | 31.75% | 31.97 |
| 3 | Quant Mid-Cap (Direct Plan-Growth) | 4222.00 | 63.16% | 35.32% | 37.48% |
| 4 | JM Mid-Cap (Direct Plan-Growth) | 693.00 | 62.93% | NA | NA |
| 5 | Motilal Oswal Mid-Cap (Direct Plan-Growth) | 7411.00 | 61.72% | 36.57% | 33.93% |
| 6 | WhiteOak Capital Mid-Cap (Direct Plan-Growth) | 1427.00 | 61.36% | NA | NA |
| 7 | Sundaram Mid-Cap (Direct Plan-Growth) | 9880.00 | 59.88% | 29.22% | 26.95% |
| 8 | HDFC Mid-Cap (Direct Plan-Growth) | 56033.00 | 59.20% | 33.54% | 31.69% |
| 9 | Tata Mid-Cap (Direct Plan-Growth) | 3041.00 | 57.77% | 28.22% | 28.28% |
| 10 | HSBC Mid-Cap (Direct Plan-Growth) | 9206.00 | 57.72% | 26.54% | 25.01% |
| 11 | Edelweiss Mid-Cap (Direct Plan-Growth) | 4624.00 | 57.69% | 29.22% | 30.82% |
| 12 | ICICI Prudential Mid-Cap (Direct Plan-Growth) | 5115.00 | 57.50% | 26.75% | 27.30% |
| 13 | DSP Mid-Cap (Direct Plan-Growth) | 16790.00 | 54.76% | 22.79% | 22.62% |
| 14 | Franklin India Prima Mid-Cap (Direct Plan-Growth) | 9868.00 | 54.74% | 25.90% | |
| 15 | Invesco India Mid-Cap (Direct Plan-Growth) | 3968.00 | 52.20% | 26.79% | 27.41% |
| 16 | SBI Magnum Mid-Cap (Direct Plan-Growth) | 15458.00 | 43.06% | 25.98% | 29.36% |
| 17 | Baroda BNP Paribas Mid-Cap (Direct Plan-Growth) | 1674.00 | 48.85% | 25.41% | 27.41% |
| 18 | Kotak Emerging Equity Mid-Cap (Direct Plan-Growth) | 38520.00 | 43.09% | 25.05% | 27.91% |
| 19 | PGIM India Mid-Cap Opportunities Fund (Direct Plan-Growth) | 10043.00 | 33.93% | 19.88% | 29.33% |
| 20 | UTI Mid-Cap (Direct Plan-Growth) | 9789.00 | 42.99% | 22.73% | 25.94% |
| 21 | Aditya Birla Sun Life Mid-Cap (Direct Plan-Growth) | 4944.00 | 51.98% | 24.94% | 25.36% |
| 22 | Axis Mid-Cap (Direct Plan-Growth) | 24564.00 | 38.21% | 19.50% | 22.78% |
Returns data as on 12 Jan 2024 (Large-Cap)
| Ser No. | Scheme Name | Crisil Rank | AUM in (Cr) | 1 Yr | 2 Yr | 3 Yr | 5 Yr | 10 Yr |
| 1 | Canara Robeco Bluechip Equity Large Cap (Direct Plan-Growth) | 3 | 11,639.09 | 26.49% | 10.88% | 15.86% | 18.91% | 16.78% |
| 2 | Bandhan Large Cap (Direct Plan-Growth) | 2 | 1,299.07 | 32.63% | 11.54% | 16.63% | 17.05% | 14.74% |
| 3 | HSBC Large Cap (Direct Plan-Growth) | 3 | 1,678.16 | 29.40% | 11.23% | 15.28% | 16.81% | 15.12% |
| 4 | JM Large Cap (Direct Plan-Growth) | 4 | 73.80 | 33.67% | 15.29% | 18.78% | 16.98% | 15.55% |
| 5 | ICICI Prudential Bluechip Equity Large Cap (Direct Plan-Growth) | 5 | 47,928.62 | 30.66% | 15.48% | 19.88% | 18.11% | 17.12% |
| 6 | Grow Large Cap (Direct Plan-Growth) | 3 | 113.49 | 27.57% | 12.50% | 15.46% | 14.91% | 14.83% |
| 7 | Baroda bnp Parbas Large Cap (Direct Plan-Growth) | 4 | 1,693.42 | 29.09% | 13.70% | 16.89% | 18.49% | 17.09% |
| 8 | UTI Large Cap (Direct Plan-Growth) | 2 | 12,230.07 | 23.07% | 6.97% | 13.84% | 15.28% | 14.66% |
| 9 | Invesco India Large Cap (Direct Plan-Growth) | 3 | 909.48 | 33.83% | 11.47% | 18.95% | 17.70% | 16.86% |
| 10 | Taurus Large Cap (Direct Plan-Growth) | 1 | 40.70 | 24.76% | 12.28% | 14.49% | 13.60% | 12.84% |
| 11 | Axis Bluechip Large Cap (Direct Plan-Growth) | 1 | 33,171.04 | 22.55% | 4.94% | 10.61% | 15.42% | 15.74% |
| 12 | Nippon India Large Cap (Direct Plan-Growth) | 5 | 20,217.64 | 36.51% | 20.39% | 24.52% | 18.32% | 18.65% |
| 13 | Tata Large Cap (Direct Plan-Growth) | 3 | 1,854.67 | 28.14% | 12.94% | 19.03% | 17.03% | 15.47% |
| 14 | PGIM India Large Cap (Direct Plan-Growth) | 2 | 537.99 | 22.60% | 10.14% | 13.62% | 15.53% | 15.30% |
| 15 | Aditya Birla Sun Life Frontline Bluechip Equity Large Cap (Direct Plan-Growth) | 3 | 25,898.36 | 26.79% | 11.98% | 17.10% | 16.09% | 16.13% |
| 16 | HDFC Top 100 Fund (Direct Plan-Growth) | 5 | 30,261.72 | 33.33% | 18.52% | 21.72% | 17.06% | 16.59% |
| 17 | Mirae Asset Large Cap (Direct Plan-Growth) | 2 | 37,969.17 | 21.81% | 9.06% | 15.09% | 16.04% | 17.92% |
| 18 | Kotak Bluechip Large Cap (Direct Plan-Growth) | 3 | 7,333.93 | 26.00% | 11.54% | 17.01% | 18.07% | 16.75% |
Returns data as on 12 Jan 2024 (Multi-Cap)
| Ser No. | Scheme Name | Crisil Rank | AUM in (Cr) | 1 Yr | 2 Yr | 3 Yr | 5 Yr | 10 Yr |
| 1 | Axis Multi-Cap Fund (Direct Growth Plan) | – | 44.48% | 18.47% | – | – | – | |
| 2 | Mahindra Manulife Multi-Cap Fund (Direct Growth Plan) | 4 | 43.19% | 18.12% | 29.00% | 25.33% | – | |
| 3 | Edelweiss Maiden Opportunities Series-I, Fund (Direct Growth Plan) | – | 39.56% | 5.14% | 18.73% | 22.47% | – | |
| 4 | Edelweiss Recently Listed IPO, Fund (Direct Growth Plan) | – | 39.56% | 5.14% | 18.73% | 22.47% | – | |
| 5 | Baroda BNP Paribas Multi-Cap Fund (Direct Growth Plan) | 3 | 35.81% | 13.37% | 23.37% | 21.08% | 17.24% | |
| 6 | Kotak India Series-IV Multi-Cap Fund (Direct Growth Plan) | – | 43.28% | 20.48% | 26.39% | 26.92% | – | |
| 7 | ICICI Prudential Multi-Cap Fund (Direct Growth Plan) | 4 | 39.18% | 18.67% | 24.27% | 18.98% | 18.69% | |
| 8 | Invesco India Multi-Cap Fund (Direct Growth Plan) | 2 | 35.93% | 13.95% | 22.42% | 19.92% | 20.36% | |
| 9 | Nippon India Multi-Cap Fund (Direct Growth Plan) | 5 | 42.56% | 25.00% | 32.21% | 20.31% | 18.78% | |
| 10 | Sundaram Multi-Cap Fund (Direct Growth Plan) | 2 | 35.39% | 13.30% | 23.71% | 19.10% | 18.81% |
5. NPS (National Pension Scheme):
This pension scheme (Contributed based pension scheme), now it called National Pension System (NPS). It mixes assets like equity, government and corporate bonds. You can make a decision how much of your fund can be invested in these different assets classes based on your risk appetites.
(5.1). Eligibility for investment: Any citizen of India between 18 to 70 years of age can invest in NPS account. This account can be opened any point of presence service provider (PoP-SP). These can be banks, financial institutions. Complete list of PoPs is available on the official NPS website.
(5.2). Investment Amount: In this scheme minimum investment is Rs 1000/- every year to avoid to keep NPS acct active. However, there is no any upper limit.
(5.3). Maturity Time Period: Subscribers have to hold an NPS account for a minimum 3 years to become eligible for partial withdrawal. This amount that can be withdrawn is restricted upto 25% of the contributed amount.
(5.4). Taxation & Benefits: Subscriber can claim a deduction upto Rs 1.5 lakh under Section 80CCD (1) and an additional deduction of Rs 50,000 under section 80 CCD(1B). If your employer, you can also contribute to your NPS, then you can also claim a deduction under Section 80CCD (2) upto 10% of your basic salary.
(5.5). Who can invest: Any person, whose age is between 18 to 70 yrs is eligible to invest in NPS. Basically, it is specifically those investors who want to save for their retirement.
(5.6). Rate of returns: You can earn market linked return and it is medium risk investment.
6. ULIPs Scheme:
A Unit Linked Insurance Plan (ULIPs) is a combined insurance and investment. In this investment, Insurance Companies invest your part premium in asset classes like equity and bonds to generate wealth over the long run and remaining premium goes toward a life insurance cover.
(6.1). Eligibility for investment: A person can invest in ULIPs plan through any insurance company.
(6.2). Investment Amount: In this scheme minimum investment is Rs 1500/- per month, the amount varies from company to company.
(6.3). Maturity Time Period: Subscribers have to hold his fund minimum for 5 years for its maturity.
(6.4). Taxation & Benefits: Investment made by the individual in the ULIPs are eligible for tax deduction under 80C upto 1.50 Lakhs.
(6.5). Who can invest: Investors who are looking to earn a market linked return as well as insurance coverage.
(6.6). Rate of returns: You can earn market linked return and it is low risk investment.
7. Investment in Real Estate:
Real estate investment offers a variety of opportunities, including residential and commercial properties, as well as land. Real estate investors may benefit from both rental income and potential appreciation in property value over time. Additionally, real estate investments can serve as a hedge against inflation and provide tax advantages. However, the success of such investments depends on factors such as location, market conditions, and effective management. While real estate can be a lucrative long-term investment, it also carries risks and requires thorough research and due diligence before making any significant financial commitments. Secondly, this investment has delivered stunning returns in the past and it has its own set of risk and limitations.
(7.1). Eligibility for investment: A person can invest in real estate through various options, such as buying residential or commercial properties.
(7.2). Investment Amount: In this investment, there is no such limit for minimum or maximum. You can invest any amount as per availability of your budget. However, it needs hefty amount.
(7.3). Maturity Time Period: There is no any maturity date, you can remain invested for the time you desired.
(7.4). Taxation & Benefits: Rental income earned on this investment is taxable as per the income slab. But it also offers tax benefits on interest on mortgage loan, property taxes etc. In addition, long term gains from this investment can also have favourable tax treatment.
(7.5). Who can invest: This investment is suitable for those investors who are looking for regular rental income, capital appreciation as well as diversification of their portfolios.
(7.6). Rate of returns: Real estate investment has great potential for profits through property appreciation and rental income also. Its returns can vary depending on location and market value of that particular site, where investment is made. In this investment risk is medium to high.
8. Sovereign Gold Bonds (SGBs):
These bonds are issued by the Reserve Bank of India (RBI) on regular basis, we may say it is an alternative to physical gold investment. Secondly, these Sovereign Gold Bonds are linked with gold price and return guaranteed by the Govt, according to this scheme there is no need to keep physical gold with you.
(8.1). Eligibility for investment: Any person can invest in these bonds through leading public and private sector banks.
(8.2). Investment Amount: In this scheme minimum investment is the price of one gram gold. However, one can deposit maximum upto the price of 4 Kg gold every financial year, but trust can purchase upto 20 Kg.
(8.3). Maturity Time Period: Its maturity is after 8 years, which starts from the investment date.
(8.4). Taxation & Benefits: This scheme is completely tax-exempted after its maturity. However, interest earned on the SGBs is taxable as per the slab applicable for you.
(8.5). Who can invest in SGBs: This scheme is suitable for investors, who are seeking safe and govt backed guaranteed returns. Also, suitable for those investors looking for diversification of their portfolio by buying gold. In this scheme has low risk.
(8.6). Rate of returns: This scheme offers the benefits of capital appreciation and earn regular interest @ 2.5% semi-annually.
9. Investment in Various Other Govt Bonds:
These are the debt securities that are issued by the Govt of India to raise funds for various purposes like infrastructure development, financial budget deficits etc. It is safe and fastest investment option as govt backs it.
(9.1). Eligibility for investment: You can buy primary bonds through banks, primary dealers and stock exchanges etc. However, this can be bought through secondary market like debt funds, Gilt funds and stock exchanges etc.
(9.2). Investment Amount: In this scheme, you can invest minimum Rs 1000/- and maximum there is no limit.
(9.3). Maturity Time Period: There is no any specific maturity period for these bonds, as it varies with the type of bonds. For example, treasury bills have a maturity period of 90 days or 364 days. Dated G-Secs comes with a maturity period of 5 years to 40 years.
(9.4). Taxation & Benefits: Interest earned on these bonds is fully taxable as per your income tax slab. Other than this, if you have earned an short capital gains, it will also be eligible as per tax slab applicable for you. However, long-term gains will be taxed @ 10%.
(9.5). Who can invest in this scheme: Any individual, who is a citizen of India can apply for this and this scheme is risk-free, as these are govt bonds.
(9.6). Rate of return: This scheme offers a guaranteed return on your investment.
10. Conclusion:
The country has witnessed significant growth in sectors such as technology, renewable energy and infrastructure by attracting both domestic and foreign investors. While the stock market continues to be a focal point for many, alternative investments such as real estate and startups have gained prominence. India Govt initiatives like “Make in India” and economic reforms have further contributed to the investment-friendly environment. However, it is essential for investors to navigate through regulatory challenges, market fluctuations and global economic uncertainties, with a strategic and informed approach, India offers a compelling investment destination, and the evolving economic scenario suggests a promising outlook for those seeking long-term returns.
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