Investment is a great option, but before you venture into investing, it is good to know about the following…
Risk and return go hand-in-hand. The higher the risk, the greater the return. The lower the risk, the lower the return.
If you want to protect your principal amount then investing in fixed income is a good option. It is relatively less risky. However, when you adjust the returns for inflation, you risk losing money. Example - A fixed deposit that gives you 9% when inflation is 10% means that you are losing a net 1% per year. Fixed-income investment is best suited for ultra risk-investor investors
Investing in equity is a great option. It has been known to beat inflation for a long time. Historically, equity investment has generated returns of around 14–15%. However, equity investment can be risky
Real estate investment requires large outlay of cash and cannot be done in small amounts. Liquidity is another issue with real estate investing - you cannot buy or sell whenever you want. You always have to wait for the right time and the right buyer or seller to do a transaction with you.
Gold and silver are considered to be relatively safe but the historical returns on such investments have not been very encouraging.
Risk and return go hand-in-hand. The higher the risk, the greater the return. The lower the risk, the lower the return.
If you want to protect your principal amount then investing in fixed income is a good option. It is relatively less risky. However, when you adjust the returns for inflation, you risk losing money. Example - A fixed deposit that gives you 9% when inflation is 10% means that you are losing a net 1% per year. Fixed-income investment is best suited for ultra risk-investor investors
Investing in equity is a great option. It has been known to beat inflation for a long time. Historically, equity investment has generated returns of around 14–15%. However, equity investment can be risky
Real estate investment requires large outlay of cash and cannot be done in small amounts. Liquidity is another issue with real estate investing - you cannot buy or sell whenever you want. You always have to wait for the right time and the right buyer or seller to do a transaction with you.
Gold and silver are considered to be relatively safe but the historical returns on such investments have not been very encouraging.
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