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Top Investing Ideas to Consider in 2023

We all want fast pleasure in today’s world. Despite understanding that patience and discipline would provide greater results, we want to complete all of our tasks as soon as possible. We want to get the maximum potential return in the quickest amount of time. It is for this reason that we are constantly on the hunt for the greatest investment strategies that can double or triple our money.

The word “programme” refers to the process of creating a programme. The word “programme” refers to the process of creating a programme. Also, they may take longer than expected to get the intended results. To successfully develop your money, you must fit the available investment plans with your investing horizon and level of risk tolerance.

Divide your financial goals into three categories to help you choose the best investment plans for your portfolio: long-term, medium-term, and short-term. This will give you an indication of how much time you have to complete the task. Following that, you can select from the available options based on your risk tolerance.

This article will look at some of the most popular investment alternatives in India that fall into these three categories: long-term, medium-term, and short-term. More significantly, we’ll show you how to combine several investing options to create the greatest investment strategy for you.

Long-Term Investment Strategies
Long-term goals are those that you hope to achieve within the following 7-10 years. As a result, when looking for the finest long-term investment plans, you may opt for solutions that are volatile but have the potential to offer large returns over time.

That being stated, you must evaluate how much volatility you can tolerate and then choose your investing options accordingly. Let’s take a look at some of the investment possibilities that can meet your long-term investing goals, as well as the risks and rewards they can provide.

Direct Investment
The following is a list of the top ten things to do in your spare time. There are numerous examples of equities that have increased the wealth of investors throughout time. For example, in the last 15 years, the Indian non-banking financial company Bajaj Finance has provided an annualised return of more than 41%.

To put this return into context, a Rs. 10,000 investment in Bajaj Finance in January 2007 would have grown to more than Rs. 18 lakh in January 2023. It means that your assets would have risen 180X.

Many other stocks, such as Bajaj Finance, have emerged as wealth builders for investors. At the same time, many businesses have proven to be wealth destroyers. Consider the case of Reliance Communications. Its stock prices have plummeted by 98-99% since their peak in January 2008. And investors in these stocks saw their money dwindle.

To summarise, while stocks offer enormous potential to increase your money over time, the hazards of investing in equities are equally substantial.

You can invest directly in company stocks. The actual issue, however, is locating the appropriate stocks. Moreover, with over 5,000 stocks listed on Indian stock exchanges, selecting the proper stocks is undoubtedly difficult.

Mutual Funds of Stocks
Take professional advice and diversify your investments across numerous stocks to lower the danger of avoiding the wealth-destroyers. Here is where Equity Mutual Funds come into play.

Equity mutual funds invest mostly on stocks. Yet, they do not focus your money on just one or two stocks. These funds spread your money among several stocks. Most importantly, these funds are managed by expert investment managers. As a result, they only invest your money after thorough study. As a result, it boosts your chances of making strong long-term profits.

Property Management
It is without a doubt one of the most popular investment options for Indians. Yet, while property investments have historically generated spectacular profits, they come with their own set of dangers and limits. One of the major concerns with real estate is that you may not be able to sell it quickly. In addition, if you are in a hurry to sell the property, you may have to sell at a steep discount.

Furthermore, even if the amount of money required is less than the value of the property, you must sell the entire property to obtain the funds.

Gold
Since ancient times, gold has been a symbol of riches. Even now, it retains its lustre as an investment alternative that can outperform inflation.

Real gold has traditionally been the preferred method of purchasing the precious metal. However, it has constraints such as additional manufacturing or design fees or storage costs. To circumvent these constraints, you can purchase gold using mutual funds and exchange-traded funds (ETFs). We have a blog where we explain several gold investment options in India. Read it to find out which one is best for you.

In terms of long-term returns, gold has historically not delivered the same high returns as equities.

Return Comparison (Gold Vs. NIFTY 50 TRI)
Investment Period	Gold Returns (%)	NIFTY 200 TRI Returns (%)
5 years	12.72	12.22
10 years	5.35	12.91
15 years	10.36	8.92

Yet, the price of gold normally rises when individuals seek safe-haven investments during a crisis. As a result, they are an excellent hedge against inflation or equities.

PPF and other small savings plans
For consumers who want to invest in very secure investment possibilities, the government has launched a slew of small-savings programmes. These schemes provide investors with guaranteed profits with limited volatility. However, your returns are smaller than those of market-linked products such as NPS, Mutual Funds, or stocks.

Having said that, small savings plans often outperform inflation and FDs by a wide amount. Small-scale long-term savings schemes include the Public Provident Fund (PPF), Senior Citizens Savings Scheme (SCSS), Sukanya Samriddhi Programme, and Kisan Vikas Patra.

The table below displays some of the small savings programmes ideal for long-term investment, as well as the potential returns.

*Data as of Jan 2023

NPS
The National Pension System (NPS) is a long-term investment plan geared for retirement. It is a mix of assets such as stocks, government bonds, and corporate bonds. Based on your risk tolerance, you can select how much of your money to invest in different asset classes.

A Unit-Linked Insurance Plan (ULIP) is a type of insurance that combines life insurance with investing. A portion of your premium is invested in asset types such as stocks and bonds to develop wealth over time. Another portion of your premium is allocated to life insurance.

ULIPs have a history of charging exorbitant fees. New ULIPs, on the other hand, do not have such hefty charges. They do, however, have a 5-year commitment. You can read our blog Mutual Funds vs. ULIPs to determine which option is best for you.

Best Long-Term Investing Strategies
Medium-term goals are those that are 3-5 years in the future. Saving for a wedding, a down payment on a property, house renovations, and so on are examples of medium-term goals.

For such medium-term financial objectives, you need investment options that can outperform inflation while being relatively stable. Here are some investing possibilities that can help you meet your medium-term financial objectives.

Certificates of Deposit for National Savings (NSC)
The National Savings Certificate (NSC) is a government-backed post-office savings instrument. It functions similarly to a 5-year FD. As a result, your NSC savings will mature in 5 years and you will earn 7% annual income. However, the total amount is only payable upon maturity.

Hence, if you have a 5-year objective in mind, NSC is one of the safer investment options. However, it has constraints such as a 5-year lock-in period and lower returns when compared to Debt Funds or Hybrid Funds.

Postal Service Time Deposit
Post offices, like banks, offer FDs. These investment alternatives, known as National Savings Time Deposits, allow you to deposit your money for short-to-medium time periods. National Savings Time Deposits have the advantage of providing higher returns than banks. And this without any added risk because these programmes are supported by the Indian government.

Tenure	Post Office Time Deposit Interest Rate	SBI FD Interest Rate
1 year	6.6%	6.75%
2 years	6.8%	6.75%
3 years	6.9%	6.25%
5 years	7.0%	6.25%

Medium-Term Debt Funds
There are up to 16 different types of Debt Funds. All of these Debt Fund categories differ in terms of the amount of risk they assume and the rate of return they seek. As a result, you must be certain of your objectives before selecting the best Debt Fund for you.

For a medium-term goal, there are three Debt Mutual Fund types that provide the right balance of risk and return. Banks & PSU Fund, Corporate Bond Fund, and Short Duration Fund are the three Debt Mutual Fund categories. To see why these three Debt Fund categories are the best fits for your medium-term goals, read our essay The Best Debt Mutual Funds For 3 Years.

Hybrid Funds TThese mutual funds invest in many asset classes. The most common asset class combination used by these funds is equity and debt. Yet, some Hybrid Funds also invest in gold or real estate. The benefit of these products is that you can benefit from both the growth potential of equity and the stability of debt in one vehicle. Further information about these funds can be found on our Hybrid Funds website.

Best Short-Term Investing Alternatives
While looking for the best short-term investing plans, you must consider two critical factors. To begin, you must reduce the risk to the capital invested. Second, your investments must be easy to access. Let’s have a look at the investment possibilities that can help us achieve these two goals.

Fixed Deposits at Banks (FDs)
This is a popular investment option in India since it provides guaranteed profits. FDs operate in a straightforward manner. You put your money in the bank, which guarantees you a specific return on your initial investment at the end of the term.

While FDs are one of the most secure investment options, they do have some substantial drawbacks. FD post-tax returns hardly outperform inflation. This means that if you invest in FDs, you are effectively generating negative returns and destroying your capital over time. Furthermore, FDs charge a penalty if you withdraw your money before they reach maturity. As a result, the liquidity of FDs is also a key limitation.

The three Debt Fund categories that match nicely in your short-term investing basket are Debt Funds for Short-Term Liquid Funds, Ultra-Short Duration Funds, and Money Market Funds. These are extremely low-risk items. They are also more accessible to investors than traditional products such as FDs. Further information on these three categories may be found in our blog Top Types of Mutual Funds for Short-Term Investing.

How Do You Choose the Best Investing Strategy?
All of the investment products we’ve explored thus far assume varying degrees of risk and seek varying rates of return. None of the financial solutions are a one-stop shop for all of your investing needs. To reach your objectives, you must carefully construct a portfolio of several investment products based on your risk tolerance, investment horizon, and expected return.

But, determining your risk profile, the best investment possibilities, the best exit strategy, and so on is never straightforward. To deal with these critical financial decisions, you need the continual assistance of an expert. This is where Parasram can assist you.

Parasram produces and recommends individualised investment plans that are appropriate for all of your objectives. Hence, regardless of whether you have a short-term, medium-term, or long-term goal, Genius will first analyse you as an investor and evaluate your risk-taking capacities.

Following that, Experts generates portfolios based on your risk score. These portfolios provide exposure to Indian and worldwide equities, debt, and gold. The allocation to various asset classes is determined by a variety of market factors, including inflation, valuations, and price patterns. Furthermore, Parasram advises you exactly what modifications to make in your portfolio each month. The proposed improvements assist you in capitalising on current market conditions and continuously outperforming the market. The best aspect is that it all happens in real time, and you can complete the rebalancing with a single press.

Parasram’ sophisticated approach to personalisation, asset allocation, and monthly rebalancing enables you to earn great returns while maintaining consistency. You also have more protection during market downturns. Experts portfolios have delivered 80% more than their benchmark while providing 40% higher protection during the worst market declines, which is a significant sign.

January 21, 2023