Do not put all your Eggs in one Basket !

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                   An investor succeeds only when he spreads his wealth & diversifies his investment in different options available in market. But, he should research several investment tools and apply his wisdom before making any investment. He should be very clear regarding his requirement & investment goal.
                       Examples of few investment options which are popular in Indian market are  illustrated below.......

1) Savings account:

  • Low-interest investment plan, roughly 4%
  • Good option regarding easy & instant withdrawal
  • Annul interest up to Rs.10000/- is tax-free

2) Fixed Deposit:

  • Medium-interest investment plan with various slabs of interest
  • Investment is locked for fixed term
  • Any interest is taxable
3) Sovereign Gold Bond:
  • Paper gold investment launched by RBI without transaction of physical gold
  • Investment is locked for long term
  • Return is tax-free
  • Additional 2.75% of interest provided annually, which is taxable.
4) Public Provident fund:
  • 7.6% annual Interest
  • Investment is locked for 15 years
  • Return from investment is tax-free
5) Equity / Share:
  • Sound knowledge, huge market research & good luck are involved.
  • No lock-in period.
  • Return after one year is termed as " Long Term Capital Gain" which is tax-free upto gain of Rs.1 lakh in any financial year.
  • Return before one year is termed as " Short Term Capital Gain" which is taxable.
6) Mutual Fund:
  • Best Plan in Indian market.
  • Wise selection of fund after market survey is required.
  • One/ three  year lock-in period.
  • Return after one year is termed as " Long Term Capital Gain" which is tax-free in case of equity-oriented Mutual Fund upto gain of Rs.1 lakh in any financial year.
  • Return before one year is termed as " Short Term Capital Gain" which is taxable.

                              Only some of the popular options are discussed. Hope this will stand you in good stead.

Happy investing !!!
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Comments

  1. Avijit27 March 2017 at 02:40

    "equity-oriented Mutual Fund" means share oriented? How do we know which Mutual fund is the best for us.Can you elaborate which mutual fund is risky

    ReplyDelete
  2. PRADIP27 March 2017 at 05:34

    Equity-Oriented Mutual Funds are of various types. According to market capital, it may be categorised into... Large Cap, Mid Cap & Small Cap. In Large Cap MF, risk factor is low & investment return is also low. In Mid Cap MF, risk as well as return is medium. In Small Cap MF, possibility of Risk as well as reurn is high in nature.
    Combination of all of the above-mentioned three type is called Multi Cap or diversified Mutual fund.
    Now, Best Mutual Fund is a relative thing as this will vary man to man according to their investment plan & goal .
    I will elaborately discuss all this things in near future after understanding common necessary fundamentals of stock market.

    Pl. comment !

    ReplyDelete
  3. Avijit27 March 2017 at 06:00

    Thank you for your reply,So diversified mutual fund can be debt/bond ridden and equity based that is both in single mf. right?

    ReplyDelete
    Replies
    1. PRADIP27 March 2017 at 08:02

      No. Diversified MF will invest money in equity of Large Cap, Mid Cap & Small Cap only. That's why this MF is also called Multicap MF.
      pl. comment !

      Delete
    2. Avijit27 March 2017 at 09:27

      I think MF may be high ,medium and low risk category and risk depends on which section/portfolio they are investing.High risk MF that you are described which has maximum return i,e based on equity fund ,medium risk MF may be equity and debt fund and lower case purely debt and government bond etc here can be guarantee return bcoz risk is minimum .I am saying this because once i saw a MF document where fund distribution shown in a chart/table. I can also remember a offer document of a MF where investor can select distribution of their fund. But one thing is sure MF does not mean it will be equity based but its one option can be Multicap MF what you said above. Please let me correct if i wrong

      Delete
  4. PRADIP27 March 2017 at 10:02

    I have already told you all about MF that are totally equity based & so no question of debt or bond arises. This MF are categorised as per market capital of stock in which MF is investing as shown below....
    1) MF-Large Cap : Only invests in Big companies with market capital > 20000 Cr.
    2) MF-Mid Cap : Only invests in medium companies with market capital between 5000Cr & 20000 Cr.
    3) MF-small Cap : Only invests in small companies with market capital < 5000 Cr.
    4) MF-Multi Cap : Invests in companies with any value of market capital.

    This is very simple & don't think in a complicated way! I will discuss everything but slowly for everyone. Mutual fund topic will come only after understanding of share market. Have patience dear!

    ReplyDelete
  5. PRADIP27 March 2017 at 10:10

    The MF you were thinking about is " Hybrid-Mutual Fund". Actually I don't want to discuss this things now!

    ReplyDelete

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