A lot of us also have this in your mind – “What’s the best investment option“? Naturally everybody wants to purchase investment instruments that they could possibly get maximum return. Though there’s no fixed meaning of maximum return, every one of us expects return greater than the fixed interest rate of return available. For instance – If a person blogs about the rate of return of all of the available financial instruments and also the maximum fixed interest rate of return is 8% per year. Any investment which provides greater than 8% return is recognized as a much better investment.
There’s no such idea of best investment option. This will depend in your personal conditions in addition to general market conditions. Let’s take a good example – You’ve Rs 1,00,000 inside your account and you need to invest?
The most crucial factor you should think about an investment horizon (period of time when you have the quantity). According to this answer you could decide among the kind of investment option which matched neglect the horizon. This is actually the initial step towards investing. If you wish to invest for the son’s education after ten years, don’t purchase 1yr bonds for the following ten years. Select a lengthy term investment option
Next just how much risk you are able to undertake neglect the. For instance – From Rs 1, 00,000 you are able to have a chance of taking a loss on Rs 10,000 and Rs 90,000 ought to be safe. Invest Rs 10,000 available market and Rs 90,000 in Bank FDs, PPF.
Third indicate consider may be the rate of return. If you’re pleased with the fixed interest rate of return provided by certain instruments, purchase individuals instruments and produce fixed interests. Otherwise, you need to take a look at instruments which could offer greater returns. However risks are affixed to such instruments and you should know of all of the risks before investing.
To some bigger extent, an effective financial planning will help you choose the best investment options. These may become best investment options whenever you achieve your financial targets.