Top Best 10 Investment Options in India

Top 10 investment plan around us

February 28, 2017
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 Investment Options

Actually we are in need of financial security  so we do invest. The best way to attain financial security is to save and invest money for a long period of time to have a financial stability in future. The typical thinking of most of the people, if you need more money you need to work more. But is that bunch of money going to be pleasurable if you don’t have the time to enjoy it? You can’t have a clone of yours to work every time for you so the expansion of money leads to an extension of your working hours. Investment is to make your money work for you, maximizing your earning potential to know more about the best investment options in 2017.

Best Investment Options in India

Investment Options Maximum Amount Minimum Amount Minimum Investment Period
Public Provident Fund 1,50,000/ – (One FY) 500/- (One FY) 15 Years
Mutual Fund (SIP) No Limit As low as 500 Only applicable in case of close-ended and ELSS schemes
Equity Shares No Limit No Limit Not Applicable in this case.
Real Estate Investment No Limit No Limit Not Applicable in this case.
Gold ETF No Limit Variable Not Applicable in this case.
Post office monthly income account schemes (single) 4,50,000/- 1,500/- 5 Years
Company Fixed Deposits No Limit As low as 2000/- 12 Months
Initial Public Offerings No Limit No Limit Not Applicable in this case.
Unit Linked Insurance Plans No Limit 1,00,000/-  for plans 45 years and below 45 Years or below
Bonds No Limit Variable Variable


There are two way by which our money can work for us are:

  1. Money earns Money: You can give money to someone to use it for a pre-defined period of time. That money will come back with an interest. Or you can also invest in stocks.
  2. Buying something that could increase in value:You are an owner of something for which you hope that its value will increase with time. At the time of need, you can sell it and get the money along with the profit.

As we know that there are various short term and long term investments option available in the market in 2017 like mutual funds, bank fixed deposits, equity shares, stocks and much more. One can opt for the most appropriate investment option as per his needs, budget and future plans.

Always Risks and Returns are the two terms that click in your mind instantly whenever you hear about Investment. All the three terms- Investment, Risks and Returns are interlinked and interdependent. High investment leads to more risk which further leads to higher returns.

Some of us think that ‘Investing is Gambling’. But these two terms are quite different. One should not get confused with both. Gambling is putting money at risk by betting on an outcome which is uncertain. It works just on a hope that you might win the money. But investing doesn’t work on this principle. Yes, there is a risk but there is also a security of getting a certain amount of money after a defined time interval.

Actually timeframe, tolerance, diversification, and knowledge, these are the four strategies which can reduce your exposure to investment risk. You should stay invested for longer in that product with which you feel comfortable. Don’t get stuck to any one type of investment option and put efforts to understand the financial world to become a good investor. 

 

The following are the top 10 best investment options in India

  1. Public Provident Fund

As we know it is the safest and secure long-term investment product amongst the best investment options in India. It is totally tax-free. Under the PPF account opened in bank or post office the money get locked for the time of 15 years and you can earn compound interest from this account. You can also extend the time frame for the next five years. The only drawback of this PPF account is you are only allowed to withdraw your investment at the end of 6th year. In case you need it, you can take a loan on the balance of PPF account.

 

The current interest rate for years 2016-2017 is 8.1%pa.

Financial Year Interest Rate
2012-2013 8.80%
2013-2014 8.70%
2014-2015 8.70%
2015-2016 8.70%
2016-2017 8.10%

**PPF rates represented above are for last 5years.

**All interests earned on PPFs are tax-free.

  1. Investing a Mutual Fund

Those people who want to invest in equities and bond with a balance of risk and return generally choose to invest in mutual funds. Inthosedays investing in stock markets through a mutual fund is a market trend. One of the best investment options in India is a mutual fund for a long time by systematic investment plan.  This investment plan will definitely give a much better return compared to any other investment option in the market.

  1. Direct Equity or Share purchase

Make sure you know how to analyze a share stock before going to buy direct equity or share. It is the best amongst the list of top 10 best investment options in India for the long period of time. If the investment is for a long time, for example, more than 15 years, it is somewhat sure that there will be higher return.

  1. Real Estate Investment

As we know one of the fastest growing sectors in India is real estate, holding the huge prospects in major sectors like housing, commercial, hospitality, manufacturing, retail and more. Buying a flat or plot is the best decision amongst the investment options. The risk is very low because the rate of property increases within 6 months.

  1. Investing in Gold in Various Ways

In india Gold is one of the oldest and evergreen investment products, as the value of gold increases quickly.

Those who are looking for a gold investment option you can simply opt for any gold investment format like gold deposit scheme, gold ETF, Gold Bar, Gold mutual fund etc. gold investment can benefit in the short period of time.

Top 5 Indian Gold ETF investment options, with their return rates

Mutual Fund Scheme 1 Month 3 Month 6 Month 1 Year 2 Year 3 Year 5 Year
Religare Invesco Gold ETF -1.5 13.2 8.1 10.7 0.9 2.4 5.6
SBI – ETF Gold -1.5 13.2 8.2 10.7 1.6 2.5 5.7
ICICI Pru Gold ETF -1.4 13.3 8.3 10.5 1.5 2.5 5.6
Quantum Gold Fund -1.6 13.1 8 10.5 1.5 2.4 5.6
HDFC Gold Exchange Traded Fund -1.5 13.2 8.1 10.3 1.4 2.3 5.5

**above returns have been calculated based on NAVs as on 16.04.2016

  1. Post Office Saving Schemes

From the beginning this is the best in top 10 best investment options in India that ensures the highest return, there is a monthly income plan of Post Office Saving Schemes is very suitable for retired people with regular income requirements. This government saving scheme does not have any risk-related factor but the interest is quite low.

Requirements and Benefits
Interest rate wef 1.4.2016 is 7.80% payable monthly per annum (multiples of 1500/-)
Maximum investment limit-
Single account Rs 4.5lacs
Joint account Rs 9lacs
Minimum eligibility age 10 and above (can be opened in the name of minor or by minor)
Single account can be converted to joint and vice versa.

 

7.   Company Fixed Deposits

If you are thinking for a long period then company FDs are very beneficial in comparison to the bank FDs as it gives higher rate interest. Make sure you select the investment period very carefully as it is not allowed to withdraw money before maturity. The corporate fixed deposit schemes are not under any insurance benefits and neither it is under the control of the Reserve Bank of India. Company Fixed Deposits is one of the top 10 financial investment options in India. So investors who are willing to invest for long term and can bear some amount of risk can opt for company FDs.

8.   Initial Public Offerings

IPOs is once in a lifetime opportunity as it happens only once in every company. It is very attractive if launched by the good and reputed company. There are some unique risks associated with them. The lack of information links some uncertainties with IPOs. It’s a long term investment option with low risk.

  1. Unit Linked Insurance Plans

It is also known as ULIPs, which falls under the list of top 10 best investment options in India. It invests in debt and equities markets. The fluctuation is counted by the net asset value (NAV). It is not very known but, plays an important role investment market.

Period Absolute Returns (in%) Annualised Returns (in%) Performance Ranks(within fund class)
1 Week 1.3 ** 32
1 Month 2.7 ** 23
3 Months 3.2 ** 14
6 Months 1.3 ** 6
1 Year 2 2 7
2 Years 26.1 12.3 22
3 Years 37.6 11.2 25
5 Years 55.7 9.3 7

**annualized return illustrated only for 1year and above.

**ranking amongst total 35 Equity Oriented Hybrid Speciality Funds

  1. Invest in Bonds

Sometime we fee uncomfortable in investing in mutual funds and direct equity market investments, then we can try investing in bonds. Investing in bonds can be one of the best investment options since there are many good bonds which actually provide a high rate of return on investments. There are bonds that are under the regulation of government, for example, a bond for 10 years which is currently giving a rate of interest of 7.70%.

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