Best Investment Options in India in 2024

16 February 2024
7 min read
Best Investment Options in India in 2024
whatsapp
facebook
twitter
linkedin
telegram
copyToClipboard

We know how important it is to consider our investment options. However, a financially secure life must also include money accumulation and returns that can improve the future and your goals. Additionally, relying solely on savings won't always make sense, will it?

There are plenty of investing options in India. In this blog, you will find out what you would like to opt for to create financial stability and security that would benefit you. So, here are some of the Best Investment Options in India in 2024 based on three main criteria. You can choose how you could start your investment journey-

  • Low-Risk Investments
  • Medium-Risk Investments
  • High-Risk Investments

What is A Low-Risk Investment?

Put, a Low-Risk investor has a lower risk tolerance. It indicates that the investor wants little to no volatility in their portfolio of investments.

Typically, retirees and beyond who have spent years building a nest egg choose to make these investments. The returns from these investments are always guaranteed because they rely on fixed-income instruments.

Here Are A Few Low-Risk Investment Options

Some of the best investment plans carrying low risk are as follows-

  1. Fixed Deposit

    They are consistently regarded as one of the best investment options and the safest form of investment. In addition, you can assemble high returns from various Fixed Deposit schemes through a fixed deposit.

    The fund always maintains security and promises returns free of market fluctuations. Most importantly, the principal on a fixed deposit is not depreciated.
  2. Public Provident Fund

    A Public Provident Fund is a government-backed investment option that can be used for a safe investment with high returns in India. It provides you with a risk-free return, which also makes it one of the best investment options.

    The interest received over the amount on this scheme is revised and paid by the government every quarter.
  1. Money Market Funds

    Money Market Funds are short-term debt funds.

    They invest in various money market instruments and endeavour to offer good returns over up to one year while maintaining high levels of liquidity. The average maturity of a Money Market Fund is one year.
  2. Municipal Bond

    A Municipal Bond or Muni-Bond is a debt instrument issued by municipal corporations or associated bodies in India.

    These local governmental bodies utilize the funds raised through these bonds to finance projects for socio-economic development through building bridges, schools, hospitals, providing proper amenities to households, etc.
  3. Certificate of Deposit

    A Certificate of Deposit is a term deposit offered by scheduled commercial banks that do not have the option of premature redemption.

    The primary difference between a Certificate of Deposit and a Fixed Deposit is that a Certificate of Deposit is freely negotiable.
  4. Treasury Bills

    The Government of India issues Treasury Bills to raise funds for up to 365 days. It is considered an investment with the best returns. Since the government gives these, they are considered very safe.

    However, lower risks also translate into lower returns which is the case with treasury bills. As a result, the returns on Treasury Bills are lower than other money market instruments.

What is A Medium-Risk Investment?

Some investors are pretty comfortable with Medium-Risk investments on the table. These returns are relatively higher when compared to low-risk investments.

They are investments that have a certain level of risk, but at the same time, they hold higher returns.

Here Are A Few Medium-Risk Investment Options

Some of the best investment plans having medium-risk are-

  1.  Balanced Mutual Fund

    A Balanced Mutual Fund is another of India's most prominent investment options. Even though it is subjected to market risks, it can be the best investment to grow money multifold.

    On the other hand, when you have a lower risk appetite but want higher returns, a fixed-income mutual fund or monthly systematic investment plan can be your best investment option.
  1. Debt Funds

    Debt Funds are mutual funds that invest in fixed-income securities such as bonds and treasury bills. These monthly income plans assure some locked-in money and not a total loss. As a result, they have a low-risk ratio compared to high-risk investments.
  1. Dividend-Paying Stocks

    Dividend-Paying Stocks are an excellent way to invest in the stock market. Although they're not as popular as high-yield bonds, dividend-paying stocks offer investors a way to earn a steady income from their investments.

    They're also known as "blue chip" stocks because of their history of paying dividends and because they tend to be bought by institutions such as mutual funds and pension funds.
  1. Exchange-Traded Fund (ETFs)

    An ETF, short for Exchange-Traded Fund, is just like a stock and can also be called a basket of securities that trade on the stock market.

    Exchange-traded funds pool the financial resources of several people and use them to purchase various tradable monetary assets, such as shares, and debt securities, such as bonds and derivatives. Most ETFs are registered with the Securities and Exchange Board of India (SEBI).


    Hence, it is an appealing option for investors with limited expertise in the stock market.
  1. Corporate Bonds

    A Corporate Bond fund is a mutual fund that invests more than 80% of its total financial resources in corporate bonds. Business organizations sell these to fund their short expenses, such as working capital needs, advertising, insurance premium payments, etc.

    Corporate bond funds are increasingly becoming a popular debt instrument for businesses to raise required finances as associated costs are lower than bank loans.

What is A High-Risk Investment?

A High-Risk investment does not precisely have a guaranteed return. However, these are generally high-return investments in India as the returns on these investments, without a doubt, are pretty high if invested wisely.

But the issue arises when the returns are not assured, and there are chances it might result in losses. The investors who pick these kinds of investments are usually the ones who are pretty savvy and are keen on understanding securities and more.

Of course, there stands no limit to the gains in high-risk investments, but significant gains come with risks too.

Here Are A Few High-Risk Investment Options

Some of the good investment plans with high risk are-

  1. Direct Equities

    Direct Equities are also one of the best investments for long-term purposes. It is an equity share of a company bound by legal terms related to company ownership.

    When you buy an equity share, you get the right to be involved in the company's decision-making. But equities do also hold a high hand when it comes to risk.
  1.  Equity Mutual Funds

    Equity Mutual Funds are funds that will primarily invest in stocks. You can invest your money in these stocks through SIP, little by little, or in a lump sum amount.

    It suits savvy investors who are experts in the market. But, as you know, it is pretty high regarding the risk involved. Your profits can be immense, but so should your risk appetite.
  1. FOREX Trading/Foreign Exchange

    FOREX, or Foreign Exchange, may be defined as a network of buyers and sellers who exchange currencies at an agreed-upon price. Hence, Foreign currency trading is the process through which people, businesses, and central banks exchange one currency for another.
  1. Hedge Funds

    In the Securities and Exchange Board of India's (SEBI's) words, "Hedge Funds, including fund of funds, are unregistered private investment partnerships, funds, or pools that may invest and trade in many different markets, strategies, and instruments (including securities, non-securities, and derivatives) and are not subject to the same regulatory requirements as mutual funds."

Note - Although these instruments fall under High Risk, they also yield high returns. Investors should assess their risk factors before investing and conduct due diligence.

Conclusion

You can achieve financial stability by saving, but is that sufficient? What if you begin saving for retirement later, which means you won't be able to cover all of the costs by keeping it alone?

Investments are, therefore, always a wise choice, and this blog will assist you in selecting among the best investment plans in India. Additionally, you always have the option to choose between Low-Risk, Medium-Risk, and High-Risk investment options.

You May Also Be Interested to Know

1.

Best Stocks to Invest for Long Term

2.

5 Best Stocks to Invest

3.

5 Best Stocks for Beginners

4.

Best Stocks Under Rs 100 in India

5.

Best Stocks Under Rs 10 in India

Disclaimer: This blog is solely for educational purposes. The securities/investments quoted here are not recommendatory.

To read the RA disclaimer, please click here
Research Analyst - Himanshu Sinha

Do you like this edition?
LEAVE A FEEDBACK
ⓒ 2016-2024 Groww. All rights reserved, Built with in India
MOST POPULAR ON GROWWVERSION - 4.8.6
STOCK MARKET INDICES:  S&P BSE SENSEX |  S&P BSE 100 |  NIFTY 100 |  NIFTY 50 |  NIFTY MIDCAP 100 |  NIFTY BANK |  NIFTY NEXT 50
MUTUAL FUNDS COMPANIES:  GROWWMF |  SBI |  AXIS |  HDFC |  UTI |  NIPPON INDIA |  ICICI PRUDENTIAL |  TATA |  KOTAK |  DSP |  CANARA ROBECO |  SUNDARAM |  MIRAE ASSET |  IDFC |  FRANKLIN TEMPLETON |  PPFAS |  MOTILAL OSWAL |  INVESCO |  EDELWEISS |  ADITYA BIRLA SUN LIFE |  LIC |  HSBC |  NAVI |  QUANTUM |  UNION |  ITI |  MAHINDRA MANULIFE |  360 ONE |  BOI |  TAURUS |  JM FINANCIAL |  PGIM |  SHRIRAM |  BARODA BNP PARIBAS |  QUANT |  WHITEOAK CAPITAL |  TRUST |  SAMCO |  NJ