Getting the right return on investment is every investors’ goal and with more and more investment options opening up regularly, some investors may feel overwhelmed. High return investment plans or top investment options with high returns may come up with higher risks. So, it is important that you factor in the risk to returns ratio before making the decision to invest in something. So, in this article, we will take a closer look at the best investment plan & option that an investor can make right now and at the same time, we will also look at what makes these unique.
This is one of the most common options that many investors regardless of their experience go for. And for those of you who don’t know what direct equity investment is- it the process of buying equity stock of the various organizations that are listed as well as unlisted in the stock exchange. In this investment, your returns will be capital gains or if not, it will be dividend returns. Some of the uniqueness of this investment option are:
a) It is considered to be a volatile investment and has a high risk-return ratio
b) This investment will have a high risk to return ratio
For those of you who don’t know what an equity mutual fund is- it is the type of mutual funds that are predominantly invested in the equity stocks and also owing to the fact that these are equity based, this type of investment also offers a high risk to return ration. These are also two types of equity mutual funds and they are actively managed and passively managed mutual funds. The primary difference between these two comes from the amount involvement from the fund manager in these funds.
- Bond Funds or Debt Mutual Funds
This third investment option is debt funds and in this investment option, the amount is invested in various fixed income securities and this include debentures, corporate or government and various other fixed income long term securities. One of the unique features of this investment option is the fact that the depending on the type of securities you have invested in, the risk that you have may differ. So, it is important to note that you should give importance when it comes to choosing the type of securities you want to invest in.
- National Pension Scheme (NPS)
The last investment option on the list is National Pension Scheme and this is a very unique investment that was particularly designed to help one in their retirement. NPS is an investment option that is backed by the Indian government and it is also regulated by the Pension Fund Regulatory and Development Authority (PFRDA). The basic goal behind NPS is to help people have a great retirement corpus and there are two types of NPS accounts titled Tier – I (Retirement account) and Tier- II.
Owing to the fact that NPS follows an auto rebalancing method in order to maintain an investment portfolio with a declining risk as someone age, it is considered to be a great investment option.
These are four of the best investment options that gives an investor the best returns but the fact of the matter is that, an investor should give ample importance while choosing any investment portfolio.