5 Best Financial Instruments Often Overlooked – 2021

by Nisha Ramesh  |  December 30, 2020

When you think of investments, what comes to your mind?

Well, generally, the first things that come to one’s mind in terms of investing are Fixed Deposit, gold and real estate. 

The more adventurous ones may even think of stocks and mutual funds. Some others might even consider bonds and debentures. But the investment horizon does not end here. 

What if you want to invest beyond the regular assets available in the market?

There is an ocean of investment avenues that are overlooked by investors.

Some of them may fetch you unimaginable returns; some may ensure regular returns and some others serve as a haven from the market risks.

Either way, you will be adding more assets to your portfolio and hence bringing in a healthy mix.  Here, I have carefully curated a list of five legitimate investments opportunities that are generally overlooked. 

1. Equity Linked Savings Scheme (ELSS)

Equity Linked Saving Scheme Fund is nothing but a tax-saving Equity Mutual Fund. ELSS funds invest more than 80% of its corpus in equities and equity-related instruments. 

For better understanding:

Mutual funds are companies that pool the investment of its investors and buy securities such as equities, debts etc. There are two major types of Mutual Funds, namely Equity and Debt Funds. 

Coming back to ELSS, if you invest in these funds, you can get a tax exemption of up to ₹1,50,000 under Section 80C of the Income Tax Act. 

These schemes come with a minimum of lock-in three years, but you can choose to stay invested for longer than that too. 

ELSS is the only type of investment that both invests in equities as well as offers tax benefits to its investors. But like every equity mutual fund, it carries significant risk due to market fluctuations. 

2. Cryptocurrencies

Cryptocurrencies are digital currencies; they can be used as a medium of exchange as well as a store of value. It was first introduced in 2009 in the form of Bitcoin and today we have about 6000+ cryptos in circulation. 

Though it has been gaining popularity recently, I believe that it is one of the most overlooked assets in terms of potential. 

For instance:

At the time of inception, Bitcoin carried a value of less than ₹1. Fast forward ten years, today the value of one Bitcoin is more than ₹15,00,000. We can understand from the example that cryptocurrencies are one of the best high return investments in the world. 

Along with high returns, cryptos also carry an increased risk due to the volatility of its prices. However, you can earn unimaginable returns if you choose right and invest wisely. 

Buy Crypto With Just Rs.100

3. Post Office Monthly Income Scheme 

Most people may not be aware of the fact that the post offices of India offer services beyond just sorting posts and parcels.

Yes, they even offer financial services such as Post office savings schemes, Post office time deposit and of course, the Post office monthly income scheme. 

This scheme is one of the highest return monthly income schemes with an interest rate of ~6.6% at present. As the name suggests, the interest will be disbursed to your accounts regularly each month. 

The POMIS is a hassle-free and safe investment scheme. And it requires you to hold a post office savings account in advance. 

However, these funds have a lock-in period of up to 5 years. In case, you want to withdraw the corpus in advance; you will be charged a penalty on your capital depending on how long you were invested in the scheme. 

4. ESG Funds

ESG expands to Environmental, Social and Governance. 

These funds invest in portfolios of companies that are assessed on the lines of sustenance in environment, society and governance. If a company is performing well presently and shows signs of sustaining in the future too can be compliant with ESG. 

One can invest in ESG in the form of Stocks and Mutual Funds. 

Suppose you are someone who is environmentally conscious and wants to invest in a sustainable future. In that case, ESG funds may be your cup of tea. 

But since it is a developing market, reliable facts may be hard to find, and you might have to rely on experts for advice before investing in such funds. 

5. ETF’s & Index Funds

Exchange-Traded Funds or ETF’s are very much like mutual funds; except they can be traded on exchanges such as BSE and NSE. These funds invest in other assets such as stocks, commodities, bonds, indices or a mix of these investments. 

ETF’s are known to be less risker than direct stocks as they are more diversified. Unlike Mutual Funds, these funds are valued and estimated continually in the stock market. 

In developing countries like ours, people now prefer such funds over active funds. However, liquidity can be an issue. 

Bottom Line

Wrapping up, I would remind you again that there is more scope beyond the traditional investment options such as stocks, bonds and mutual funds. 

You can explore the list above and see if they fit your profile and needs.

However, do note that this is neither investment advice nor an exhaustive list of instruments. I have jotted them down based on my opinions and views. 

If you have more to add to the list you are welcome to share it on our Twitter page  🙂.

Happy Investing!

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.


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