Secured Investment In The Market


The article is about invest in the market securely, if you have no time to look after your invested fund. This article enlightens where to invest and how to invest without any anxiety and risk. There are multiple ways for investing such as: fixed deposit in nationalized banks, public provident fund, preference shares, balanced fund, index funds, exchange traded fund and systematic investment plan, national pension scheme and commodities such as gold and silver.

Every person wants to invest some amount and make surplus money within a certain time. Everyone needs a risk free and relaxing investment scheme. Every common investor thought about this, but never tries to know the concepts and factors of secured depositing. In-common, many investors are of passive or dormant psychics; those who doesn't have time to watch over his/her funding. These kinds of investors should know where to invest without any risk for a long term concept. Some of the investment concepts are described here below.

Fixed deposit system at Banks

People who do not have time to know about the market status and investing fund status should open a fixed deposit account in any nationalized bank, where they can save a fixed amount for a fixed time and earn a fixed amount as per the banking interest rules. Here, depositing for a long term is highly benefited. The depositor will get high interest on long-term deposits. Another plus point is, in kind of any necessary the depositor can withdraw some amount before the maturity time.

Fixed deposit is not appropriate and secure in cooperative banks and unsure private banks. Some of the bankers also afford insurance along with fixed deposit schemes. Every person in a family should open a fixed deposit account. Where, in case of any bankruptcy each person could minimum one lac of insurance amount by the insurance corporation.

Depositor can also assemble a system with their fixed deposit account; if in case of more deposits in that account, the excess amount automatically merge or transfer with the fixed deposit account. Here the depositor will get high interests, due to their excess depositing. This kind of system was launched by many bankers. For example, if you specified 5,000 amounts for your savings account; and if it exceeds more than this, the excess amount will transfer to your fixed deposit account. Suppose this month your savings account amount reached to 15,000; then the rest amount 10,000 will automatically transfer to your fixed deposit account and you will get more interest over that.

Bankers are giving interest on fixed deposit by monthly, quarterly, half-yearly or yearly. The interest amount can be configured and merged with fixed deposit; where the depositor will get interest over the gained interest with the fixed deposit amount. It will reach to a high amount at last.

Perfect - Public Provident Fund (PPF)

People who do not have time can also invest in Public Provident Fund PPF. Every year billion people were depositing in this fund for a term of 15year. Here investor gets the interest on invested value and also the interest on return value. It is under government of India, which is very secure and risk-free. Here a small investor can open its account with minimum INR 500. Recently, PPF is deciding to increase its interest values.

Preference shares

Investors do not have time to recognize about their investment and fund status; can be invest in preference shares. Preference share holders are the first preferred persons who will get their invested money from any company. However, govt. is rarely permitting companies to sell preference share. There are very limitations on this. The companies, who have standard monetary milieu and an excellent service history, are only granted to sale preference share. There is no risk in this share, as it is different from other shares. Investors will get their amount (dividend) in a fixed interest at a certain time allocated by government. In case of any liquidation of the company, preference share holders will first get their invested money with their interest; then the others.

Mutual fund's balanced fund

Investing in Balanced fund of mutual fund is also risk-less, where the investors do not require looking after them. It is because; balanced fund is a constant fund which do not increases or decreases as the equity funds. Here one can invest both in equity and debt to balance the invested money. If equity rises, then obviously get profit and interest on the debt amount.

Index fund is also best

Index fund is also beneficial as balanced fund; where the investor need not require attempting time to time. Here, the allocations of funds are fixed in advance. Fund demonstration will occur as per the index performance. Fund differentiation may causes, but with less operating expense.

Exchange Trading Fund (ETF) and Systematic Investment Plan (SIP)

Exchange Trading Fund ETF is just like a trading business in share market, where the value fluctuates as per the market rate. However, there is no risk for the investors. Systematic Investment Plan, SIP of Mutual fund is also best for those, who do not have sufficient knowledge about the market and/or lack of time to know market rate.

National Pension Scheme, NPC

National Pension Scheme is also best for passive investors. This is very useful for those, who cannot afford high investment and do not have provident fund or pension schemes. This is a long term scheme with saving plans. Investing in this scheme is also favor of service and economic determined with security.

Investment in Gold and Silver commodities

Investing in shares and mutual funds for long-term is right, however for high returns after a long time, investing in gold and silver is very righteous method. If we think on upcoming marketplace condition, real estate and gold/silver investment are very precious. However, investing in real estate is not easy for small financiers and requires too much attentiveness on that. Therefore for small investors, investing small amount in silvers is very precious.


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Comments

Author: Pravat Kumar Das15 Oct 2014 Member Level: Gold   Points : 7

First of all understand what is secured income?
Secured income means your return on your investment is hundred percent guaranteed. So only Bank fixed deposits, investment in Government Bonds, (not in private bonds ), postal investment are secured and you get your capital as well as the profit or interest as said at that time. Rather than this nothing is secured as you mentioned NPS (national pension scheme), debt funds which are low risk investment but we can't say 100% secured. There might be some loss in future.

But It is worth less to invest all of your money in secured return investment as most of time the rate of interest they offer is below than the inflation, so indirectly it is a loss making investment option in long term period, if you are investing maximum part of your investment in secured funds.

So before investing, look in to some factor.
1- your age.
2- your monthly income and necessary expenses.
3- Your surplus amount.
4- what is your age limit to get retired.
5- your aim and goals in future.
6- your time period of investment.
7- The risk you can take.
8- Are you ready for any un noticed event?
Then only decide your place and avenue of investment. Invest with diversified amount in equity, mutual funds, gold, currencies, real estate, bonds etc.

Guest Author: Shivam Gupta22 Jan 2015

I am a student, I am interested to earn more money for himself and I can save 300-500 per month. So can I invest in share market? Is this sufficient?

Author: Swagatika Pattanaik04 Aug 2016 Member Level: Gold   Points : 5

Author has very well explained about secured investment. But there are certain things he has mentioned which are not secured.
Investing in gold and silver is not at all secure and also there is no guaranty that by holding for longer period this will go up and will increase the capital. As we can see, since 2008 gold and silver is in down trend. Suppose some one has invested 70,000 in silver in 2016 the valuation of that silver now is 47000.
Exchange trade fund or Index fund is high risk high return option. So this can not be taken by a person who wants security of his capital amount.
But I suggest that there is nothing secured, so make a proper plan according to your surplus money, future goal, taxation problems etc. Analyse your self about your investment amount, time frame of investment, the return you expect etc. Then go for various investments like savings bank account for emergency expenses, fixed deposit for safety of your money as well as to grow the capital. Invest in shares, bonds, commodities investment etc for higher returns. Invest in real estate for future prospects.
Always a consult financial planner before you decide about your major investment as some time you might make profit but all profit goes for tax and you won't save anything in your investment time period.

Author: Sheo Shankar Jha19 Aug 2016 Member Level: Diamond   Points : 3

The author has furnished all the relevant details of saving instruments which need least botheration from the side of investors. However, as the inflation rate in India seems to be high at the prevalent stage and hence the interest rate being offered by the Banks for the fixed deposit in the present situation currently hovering around 8.5 percent does not seem to be an attractive investment. This is all the more significant when we take the case of senior citizens having no alternative but to depend upon fixed deposits for their survival. Calculation has to be made by the authorities concerned to assess the real value of the money. Calculating the interest rate and the inflation, there exists a narrow gap of profit which one can earn from the Banks. Such provisions don't provide any relief to the senior citizens at least and this must be required to be attended to keeping in view of their ailing conditions.
Also, in respect of Gold and Silver commodities, there is wide fluctuation of the prices mostly depending upon the global scenarios and this may not be of great help for such sections of people who solely depend upon secured vestments.

Author: Partha K.15 Feb 2017 Member Level: Platinum   Points : 5

I congratulate the author for this extremely useful article. This is a summarized form giving details of various investment instruments which would be beneficial for the new investors who are generally risk-averse. The author has covered Fixed Deposit, Public Provident Fund, Preference Shares, Balanced Fund, Index Fund, NPS and Commodity Investment (Gold and Silver) . As far as the article is concerned, I would like to make the following observations:
a. Some of the investment instruments mentioned in the article belong to fixed return category. Although these are safe, the returns from these instruments are miniscule and cannot take care of inflation.
b. The author has mentioned about preference shares. He should have explained preference shares in more details because it may be a new term for most of the new investors.
c. The author has mentioned Exchange Trade Fund (ETF) and Systematic Investment Plan (SIP). In this connection, I would like to clarify that Systematic Investment Fund (SIP) is not an investment instrument. It is merely a method of investment. This aspect should be made clear.
d. The author could have explained in more details the difference among Balanced Fund, Index Fund and ETF.
e. As far as the investment in Gold and Silver is concerned, these are not risk-free investments and the author could have mentioned about Gold ETF, Gold Fund, Gold Bond and various other paper investments in these two commodities.

Overall I like this article which presents various investment instruments in a compact form. But I feel the article should have been categorised as 'General Finance' article instead of present categorisation as 'Share Market'.



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