Money grows only with investments and never just by savings alone. The objective of the investment is to get more out of the money you have and the purpose, channel, duration and amount are unique for everyone. With the ever-increasing penetration of internet in our daily lives and information boom that it has brought is making more and more people active about investing after having surveyed all the options available.Now the importance is more on investing rather than saving. But this doesn’t rule out the fact that even saving is also important. Investment means spending to buy that which has a potential to increase the value of money with time like a policy, an asset, or a commodity. The ultimate motive remains to increase the worth of the current money over time.
Investment is a personal choice and depends on the individual’s choice and capability amount, duration of investment and the risk appetite. To be a successful investor and earn on the investment, one should follow certain principles, which are also called “Thumb Rules of Investment”. These thumb rules answer all questions about investment and make investing in an easy affair. But still, the question that remains is, which is the best way to invest money?
1. Invest Diversified
If talked about, the best way to invest money, then invest in some part money in fixed income instrument, and invest in some of the stocks in GOLD and the rest as per your Risk capacity,
To understand how much investment is invested, you have to understand the technique of asset allocation,
With Asset Allocation technology, you learn to invest in different options of investment by dividing your capital into different parts, depending on your ability to raise your risk.
2. RISK and RETURN
If talked, Best way to invest money, if you take a low risk, you will also get less profit, and on the other hand, if you take more risk, then the probability of profit is also high.
A 25-year young man who starts his career has a lot of time to do his life in SET, thinking that he raises more RISK,
While a person whose age is to be 50, he cannot raise many risks, because he lacks time,
In such a situation, when you understand how much risk is right for you, then you can pick up calculated risk, and you can choose the best option for yourself,
However, for the young person to invest, 70% of their capital stock market, 20% Gold, and the remaining capital can be advised to invest in Fixed Income type instrument,
While a 50-year-old person can be advised to invest only 10% of his capital stock market, 10% Gold and 80% Fixed Income.
3) INVESTING IN FIXES INCOME
If you are talking about Best way to invest money, then invest in Fixed Type Income only when you want to keep the capital safe,
And whenever you invest in fixed income type, keep in mind that the benefit you get from that investment will be higher than the rate of inflation or less,
Because, if you get the benefit from your Fixed Income less than the inflation rate, then you may lose the loss of Purchasing Power in the Future Value of your capital,
For example – if you are getting 7% profit from fixed income, while inflation is increasing by 8%, then you are getting 1% capital loss,
Investment advice in fixed income is given to an older person, who does not want to take a risk at all.
4) REAL ESTATE INVESTMENT
If talking to Best way to invest money, then investing in real estate can be expected to be more profitable in risk, but you need a large amount of capital to invest in Real Estate,
Also, investment in Real Estate can not be sold overnight, there is a shortage of CASH LIQUIDITY,
That is, if you have a proprietory today, if you sell it at the current price, then it is very difficult to get a customer soon, unless you sell that proprietary at discounted prices,
Prior to investing in real estate, you should thoroughly investigate the Papers and Documents related to the property you want to invest, as well as take into account the liquidity of the property.
5) Investing in GOLD
If talked about, Best way to invest money, then in our country gold has been given a lot of importance since ancient times, and for this reason, we still believe in investment in all gold,
But in GOLD, if the only talk of investment, on average, investing in gold has benefited 8% CAGR in last 20 years, so gold is part of our investment, then it is okay, but investing in its entire capital, gold, Return on Investment is not right,
Investing in gold in 10% of your investment portfolio is considered right,
If talked about, Best way to invest money, today the stock market is in the reach of all the people, and the stock market is a very good option in terms of investment,
And, if the average return seen on the last 30 years, Stock Market has given 20% or more CAGR benefits in the long term,
Although the investment in the stock market is considered to be full of risk,
That’s because most people in the stock market do not even invest in getting the TIPS from someone else’s point of view, or simply doing TRADING,
However, investing in the Fundamentally Strong company by using your own mind should take care of Entry and Exit at the right time and if the focus is on Value Investing, the stock market is better than any other investment option,
In the stock market, to make money from the investment and stock market, you have to understand ways of working in the stock market, you have to keep in mind the understanding of business and economic changes
SUMMARY-BEST WAY TO INVEST MONEY
Personally, the best way to invest money is to believe that, STOCK MARKET is the best option for investment,
If you want to make money in the stock market, you have to adopt the persistence of continuing to learn, and investing money in the research done by yourself, keeping in mind calculation Risk and Reward,
And in this way, if you want to continue learning about the profit from the stock market, then you continue to visit our blog / website.