Investment Options In India - compounding investment options in india.

there are so many investment options in india which provides good returns and help one to take early retirement but today in this article you'll get to know about three major kind of investment options which are the most preferable and profitable investment options in india. but before that let's clear the concept of investment. which is why one should start investing?

as we all know in olden days peoples used to save their money in piggy banks or at home which does not give them any return at all. as the time passes peoples used to save their money in bank accounts, fixed deposits, recurring deposits and so on things from where they can receive a limited or a fixed amount of returns of around 3% to 5% which could be a good option for saving and complies with the security options but it does not provide returns according to the growing ratio of inflation.

in india, inflation increase with the average percentage of 5% to 6% which ultimately decrease the actual value of money. to get rid of this, many peoples used to start investing in india various different things like stocks, mutual funds, derivatives, cryptocurrencies, etc. as this investing options can provide an expected returns upto 15% to 20% on the total investment. rather than that if one can hold his investment for longer time than it might help his investment to be get compounded. this investment gives a good returns on timely basis and along with that the face value of the investment also keeps on growing. below you can find the best investment options which provides good higher returns.

investing in stocks.

investing in mutual funds.

investing in commodities.

investing in ipo's.

investing in etf's

top 5 best investment options in india in 2023.

1. investing in stocks.

nowadays, investing in equity market or you can say investing in stock market is the best investment option in one can expect returns upto 15% to 20% from the holdings, according to experts it is the most preferable and profitable investment option. as compared to investing in fixed deposits and recurring deposits, investing in stock market helps to get rid out of inflation in a better way. because the returns acquired by fd's and rd's is not enough to deal with the growing rate of inflation.

when we invest in stocks, it means we are investing in a company or we're buying a part share of a company which is listed in national stock exchange (nse) or bombay stock exchange (bse) which is regulated by the securities and exchange board of india (sebi) guidelines. 

after we invest in a company, if that company performs well during the financial year than it is said to be obvious that the stock price or we can say the share price of that company will increase. similarly if the company does not performs well during the financial year then it will also put an adverse effect on stock price. however by analyzing company's financials, charts, annual reports, etc one can make a better decision regarding where to invest. as many of the peoples had created their wealth just by making ethical investing, some of those are - warren buffet, benjamin graham. etc.

however, mostly those peoples invest in the stock market who had enough knowledge about it and who loves to take risks to get a better returns in future. as it provides the higher returns and helps to deal with inflation, it is the best option for making investment.

2. investing in mutual funds.

investing in mutual funds is also a better investment options from which one can receive a good returns as the total investment amount will also go directly into the stock market. in a mutual fund portfolio there were so many holdings of different companies and when we invest in any portfolio it means we are investing in all of that companies at one time.

as the complete amount goes in the equity market one can expect returns upto 20%. however mutual fund also consists of three types that is equity mutual fund, debt mutual fund and hybrid mutual fund.

  • in equity mutual fund the complete investment will get invested in the equity market. here one can expect returns upto 15% to 20% and along with that the risk factor is also high as compared to other types of mutual funds.

  • in debt mutual fund the complete investment will get invested in the debt mutual funds that is government bonds, corporate debt securities, money market instruments, etc here the expected returns are upto 8% and there is no risk of bearing loss and along with that by investing in this kind of mutual fund one can also receive tax benefits on returns upto rs 1 lakhs on the basis of long term capital gains.

  • in hybrid mutual fund partial amount of the investment will be get invested in the equity market and the partial amount will be get invested in the debt market. there is no fixed ratio of distribution of the total investment. one can expect returns upto 13% on the total amount. if we talk about risk factor than the partial amount which is getting invested in equity market would only contains risk and the another partial amount which is getting invested in debt market wouldn't bears any risk.

as you see some of the companies in which mutual funds had been invested. so, when someone invest in this mutual fund it means he can get the units of this companies from mutual funds whenever this companies make profits or loss the investor gets his profit by the average of this companies growth or declining rate. however investing in mutual fund will also help to create a habit of investing to take a step forward to the financial freedom.

compounding investment options in india.

3. investing in commodities.

investing in the commodity market is the third best investment option in india, commodity market includes all the things that generates from nature such as gold, silver, grains, crude oil, etc. according to experts one must invest in commodity because it helps to deal with the inflation issues. for example, if someone invest in gold and whenever in future if the gold prices rise then it means the value of his commodity portfolio have also increased. 

nowaday's, peoples also like to invest in digigold provided by various brokers some of them are groww, icicidirect, paytm money etc.

similarly if someone invest in crude oil and if the price of this commodity rise due to any reason than also the value of his investment rise. mostly this kind of investments are done with a view of gaining better returns and face off the problem of inflation.

4. investing in ipo's.

ipo or initial public offerings is also a trending investment option in which peoples like to invest to get higher returns within a short period of time. when a company list themselves in national stock exchange and bombay stock exchange under the guidelines of sebi they have to follow this procedure under which this companies have to launch their ipo's in which investors used to bid their amount so that this companies raise a capital investment from retail investors in the market.

investing in ipo's can make you extra ordinary profit and similarly it also make you extra ordinary loss. so before investing in ipo's it is always suggested to get deep information about the company's working, like the company's recent past performance, its profit and loss on quarter over quarter basis, its future prospects and so on thing.

investing in ipo's means the investment would getting into the equity market, so the risk is comparatively higher in this case. many peoples think whether it is good to invest in ipo's or not? so the answer would be yes, it is good to invest in ipo's. because the expected returns is not predictable one can also expect 100% returns, however it can also provide huge loss so being cautious would always being recommended.

best investing options in india.

5. investing in etf's.

etf's or equity traded fund is quite similar to mutual funds. here lots of portfolios were readily created and available for the investors on the basis of the returns gained, business sectors, lower risk involvement, higher market capitalization, etc. the major difference between mutual fund and etf's is the fund manager, the mutual fund is administered by a fund manager who takes the decision in which stocks to invest, but in equity traded fund the investor gets some options of readily created portfolio of companies in which he can invest to get equities of various companies at a single time.

as investing in etf's is now more easier so it is also considered as a good investment options. there are so many brokers available in the market who provides etf's investing, some of them are groww and icici direct. if we talk about icici direct there are so many good etf's portfolio is readily available which had provided good returns in recent past times some of them are bharat 22 etf, icici prudential nifty auto etf, etc.

here the investment amount is getting directly into the stock market so the expected returns would be equal to equity investing that is 15% to 20%. rather than that the risk factor is also high as similar to investing in stock market.

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