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22 Oct 2020

Where To Invest Money For Good Returns In India?

Nisha Ramesh

A good return is the goal of every investor.

It is quite common for an investor to anticipate good returns in a small timeframe without risking the investment’s principal amount. But most experts would agree that a high-return yet low-risk product rarely exists.

Does that mean that making good money from investments is very difficult?

No !!

While selecting an investment, you have to match your own risk with that of the investment. If you invest well, good returns will follow.  

How To Invest Money For Good Returns In India?

To avoid the risk of loss that follows all high return investments, an investor would benefit from being aware of some basic rules for success in investments. 

  • Diversify your assets: Diversification ensures that your portfolio is balanced. If you invest in a spread of non-related assets instead of just in one asset class, the risk of loss in one may be compensated by profits from another. 
  • Know your investments: As Warren Buffett quotes, “Risk comes from not knowing what you are doing.” Whether you are an expert or a beginner, it is wise to invest only in assets you understand. 
  • Patience is key: A seed sowed today does not become a tree tomorrow; likewise, an investment made today does not yield returns tomorrow.

Of course:

There are ways in which you can invest for a brief period and reap profits, but that is called trading and does not classify as an investment.

When an investment is made for an extended period, time does its magic, giving room for the investment to grow immensely with compounding power. 

Where To Invest Money For Good Returns In India?

Now that we understand how to invest smartly let’s see where one can invest for good returns in India.

#1. Cryptocurrencies

The crypto market is now very close to its mighty heights of 2017. Cryptocurrency as an asset has grown tremendously in its value since inception.

If you are looking for an investment that provides high returns without putting a lot of time and money into it, cryptos might be the right choice. Even institutional investors are now turning towards cryptocurrency

According to data from Yahoo Finance, as of December 2019, bitcoin has witnessed a whopping 9,150,088% return on investment which also indicates a high-risk premium.

If someone invested ₹1000 in bitcoin in 2009, that ₹1000 would have been ₹9.15 crores by the end of 2019. There are several other profitable currencies available in the market apart from Bitcoin. 

However, this is not investment advice but merely historical facts.

To help you gain more knowledge about it, we started this educational initiative, i.e., KuberVerse, where no Indian should be left behind to take advantage of cryptocurrencies.

Invest In Crypto With Just Rs.100

#2. Equities

With about 5000 stocks are trading in the stock markets in our country, less than 10% have the potential to yield good returns. The NSE’s Nifty has shown a historical return of 98.8% over the past 10 years.  

Small and medium cap companies can be a great choice if one is looking to grow their money in the long run, but you need to do your own research too.

Small-cap funds are known to emerge as multi-baggers with the potential of giving over 100% returns but are risky too. Yet they are one of the top-yielding assets available at a low cost. 

#3. Equity Mutual Funds 

Mutual funds generally come across as a low risk, low return investment option. However, this applies majorly to debt funds. Equity funds are known to have as much potential as investing in stocks. 

  • Debt funds – These funds invest in fixed-income assets such as bonds, government securities, etc.
  • Equity Funds – These funds invest solely in stocks. They are categorized into large-cap, mid-cap, or small-cap funds. 

Equity Mutual Funds have the potential of generating good returns based on which fund you choose.

To put things in perspective:

Last year, small and mid-cap funds churned maximum returns of 57% and 36%, respectively.

#4. Gold

Gold is one of the few assets that offer high returns with lower risk over a long period. It is also the only asset that is not someone else’s liability.

People have invested in gold for a very long time for various reasons. Over the years, gold investments have evolved drastically from physical gold, Gold ETF’s to digital gold.

Nevertheless:

All forms of gold are an equally attractive investment vehicle owing to their scarcity and demand. Historically, gold prices in the short term have been volatile, but long term investors have reaped great value from this yellow metal. 

Bottom line

High return investment options are a great way to create wealth.

But, some asset classes may not prove worthy to some as it does to others. So picking what suits your profile best is one of the drivers of success in enjoying high returns.

Happy investing!

[su_note] KuberVerse is an educational initiative. Anything expressed here directly or indirectly is not investment advice. And we ask you to do your own research before investing. [/su_note]

Disclaimer : Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The information provided in this post is not to be considered as investment/financial advice from CoinSwitch. Any action taken upon the information shall be at user's own risk.

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Nisha Ramesh

Content Writer

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