Strategic investments pave the way for a safe and comfortable future. The global outbreak of the covid-19 showed how uncertain times can be, it left people scrambling for earnings. Investors always look for schemes that offer huge returns within a short period without the risk of losing the principal amount. Usually, people are constantly searching for top investment plans that would give them maximum returns with limited risk.
However, finding high-return low-risk investment plans is quite difficult in today's market. Things are becoming even more difficult in these uncertain times. Every investment plan comes with its share of risk and return. Higher returns are always accompanied by higher risk and vice versa.
When selecting investment schemes you should always be aware of your risk appetite and investment horizon before choosing a product. There is an abundance of investment options that include high-risk factors but can potentially generate huge returns. These schemes offer better returns than most other long-term investment plans. Similarly, some of the plans offer lower returns but the risk factor is also low.
Typically investment plans are categorized into two classes: financial and non-financial assets. Financial assets mostly include market-linked products like mutual funds, stocks, and fixed income products. Investment tools like physical gold and real estate come under non-financial assets. The following section of this article lists some of the best investment options in India 2021.
Equity Mutual Fund
Equity mutual fund plans typically invest in equity stocks. Due to the guidelines of the Securities and Exchange Board of India equity, mutual fund schemes invest a minimum of 65% of assets in equity-related tools.
Active trading in equity mutual funds is predominantly dependent on the performance of the fund manager. On the other hand, exchange-traded funds and index funds offer passive management options. Equity schemes fall under the category of market capitalization. Classification is also dependent on whether investments are in domestic or international entities.
National Pension System (NPS)
If you are looking for safe investments with high returns in India then the National Pension System is the right option. The investment scheme is managed by the Pension Fund Regulatory and Development Authority. You can start a Tier 1 account with a minimum investment of ₹1000. It includes a combination of corporate bonds, fixed deposits, government funds, equity funds, and liquid funds. You can choose your portfolio according to your risk appetite.
Debt Mutual Funds
Debt mutual funds are particularly suitable for investors looking for steady returns. The risk factor of debt mutual funds is relatively low in comparison to equity funds. It primarily invests in stable interest-generating tools like government securities, corporate bonds, commercial paper, and treasury bills.
Not everyone is aware of the dynamics of the stock market. Most people are also not comfortable with the risk factor associated with stock market investments. Direct equity plans offer sizable inflation-adjusted returns for those who can carry on for long periods in the market. However, it does not eliminate the risk of losing a certain portion of principal investment. One needs to have a Demat account for investing in equity plans.
Senior Citizen Saving Scheme
Senior Citizen saving scheme is the most preferred choice for retired individuals. It only allows senior citizens to invest in this plan. One can avail of the facilities from the bank or post office only if they are above the age of 60. It involves a five-year period that can be extended by 3 years after maturity. The maximum investment in this scheme is 15 lacs. The interests earned from this scheme are not tax exempted.
Your house is not essentially e a real estate investment as it is meant for self-consumption. The second property that you buy can be considered a real estate investment. The location of a property is one of the most vital factors that help in determining the value of a property. It also affects the rent that you can potentially earn from it. Profits from real estate investment can be realized either in the form of rentals or capital appreciation. However, it is one of the most illiquid forms of investment. You need to have complete knowledge of the different regulatory approvals and paperwork before investing in real estate.
The best investment plans in India 2021 discussed above include both market-linked and fixed income options. Both these classes play an important role in compounding wealth. Market-linked products provide higher returns but also include a higher amount of risk. Similarly, fixed-income investments are suitable for preserving accumulated wealth and also meet financial objectives. If you wish to earn long-term returns you need to create a perfect balance of both these instruments. Experts always recommend creating a sensible mix of all forms of investments to keep up with risk factors, taxation, and time horizon. There is no other alternative to calculated investment for securing the up-coming days.
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