• NIFTY  
    11,784.95
    (0.80%)
  • SENSEX  
    39,375.75
    ( 0.84%)
  • USDINR  
    69.78
    ( 0.08%)
  • GOLD  
    33,064.00
    ( 0.12%)

BLOG

Jan-12-2019
Eye  840
Share this article
arrow

Five Effective Ideas For Long Term Wealth Creation



Investment is an activity which can be geared to offer lifelong returns through efficient planning. Putting your money in various financial instruments at an early stage makes a lot of sense and also plays a key role in securing your future. However, a lot of individuals tend to be averse to understand the nuances of various financial assets. Hence it is critical to comprehend what a long-term investment truly entails and how it can help you achieve your dreams in life. Compounding plays a key role in enhancing the returns on your investments. An investment that spans for more than three years is generally considered to be a long-term investment

Given that the financial assets performance is closely associated with the trends in economic and business cycles, impressive returns are made by investors who have an extended horizon and are willing to play the waiting game. This also ensures that the short term volatility in financial market does not bother you. By allocating your funds to various instruments takes care of the associated risk metrics. Keeping this in mind, here are the various types of long-term investment ideas for you.  

Equity or stocks: Equity markets have tremendous potential to generate great returns over long term. While the local financial markets have been witnessing a correction in recent months after hitting all time highs, supportive economic undertone and consistent buying from the domestic institutional investors is likely to offer good support for local stocks. The long term prospects appear good and it is important for the investors to be patient and alert while making any investing moves. Panic would not help much in current scenario as the stocks tend to normalize once the testing times are over and investments in equities normally provide excellent returns over long term horizons. An online investment broker would provide all the necessary services you need for investing in stock markets at complete ease.

Mutual funds: Mutual fund inflows have been surging in recent years given that more and more investors are putting their earnings in them. Assets managed by the Indian mutual fund industry hit an all time high of Rs 24.70 lakh crore in August 2018. Investing in Mutual funds has emerged as one of the most popular long term investment vehicles in recent years. There are three main types of mutual funds—Debt Mutual Funds, Equity Mutual Funds, and Hybrid or Balanced Funds. The primary advantage which mutual funds offer is that your investments are managed by asset management companies that are regulated by Securities and Exchange Board of India (SEBI). Professionally run fund houses offer a secure edge given that the fund managers are highly experienced and skilled in their areas of expertise and ensure that correct actions are taken to maximize the wealth of the investors.

SIP: Systematic Investment Planning or SIP is a very effective and investor friendly way of parking funds in the mutual funds. SIP has been exceptionally popular with the investors in recent years. It helps in Rupee Cost Averaging and ensures that you invest in a disciplined manner without worrying about market volatility. Though SIP, you can invest small amount periodically (weekly, monthly, quarterly) into a selected mutual fund scheme. SIP offers a well disciplined and passive approach to investing, to create wealth in long term (using the power of compounding). Since, the amount is invested on regular intervals instead of at one time, it also reduces market volatility.

Real estate: Real estate or property has conventionally been a great investment idea. Although real estate will not ensure immediate liquidity, the returns are generally sound when invested at the right time. A property also fetches recurring income through rent. India’s real estate had been locked up in a staggered state over last few years with the overall demand from end users taking a hit after the Demonetization and the Goods and Services Tax (GST).

Gold: Gold is a treasure, noted Christopher Columbus, the great explorer who changed the course of history forever by uniting the old world with the new. In the Indian context, Gold has been an object of desire since time immortal and the fascination of Gold seems to be only increasing as the country treads a path of economic liberalization and financial freedom. The metal is fairly liquid and is considered as an ideal inflation hedge. The yellow metal is ideal commodity to hold in portfolios of individuals, governments as well as central bankers.

Conclusion:

As an investor, always remember to spread your financial assets in various types of investments. Have a proper balance of equity and debt holdings and reshuffle your portfolio according to the changes in your risk preference. A balanced portfolio of funds with sufficient allocation to equities directly as well as through mutual funds is always advisable for long term wealth creation.

Blog by: Mr. Dhruv Ajmera
Comments
  • Recent Blog

    Essential Guide For Picking Mutual Funds in 2019


    May-31-2019

    Mutual funds have been an extremely popular choice for ...
    Attention Investors
    Prevent Unauthorized Transactions in your demat account --> Update your Mobile Number with your Depository Participant. Receive alerts on your Registered Mobile for all debit and other important transactions in your demat account directly from CDSL on the same day.............issued in the interest of investors. No need to issue cheques by investors while subscribing to IPO. Just write the bank account number and sign in the application form to authorise your bank to make payment in case of allotment. No worries for refund as the money remains in investor's account                                    "KYC is one time exercise while dealing in securities markets - once KYC is done through a SEBI registered intermediary (broker, DP, Mutual Fund etc.), you need not undergo the same process again when you approach another intermediary.
    Investors should be cautious of unsolicited emails and SMS advising to buy, sell or hold securities and trade only on the basis of informed decision. Investors are advised to invest after conducting appropriate analysis of respective companies and not to blindly follow unfounded rumours, tips etc. Further, you are also requested to share your knowledge or evidence of systemic wrongdoing, potential frauds or unethical behaviour through the anonymous portal facility provided on BSE & NSE website.BSE   http://www.bseindia.com/investors/tip-off-registration.aspx?expandable  NSE   https://www.nseindia.com/int_invest/dynacontent/any_portal.htm
    All payments to Stock Broker shall be received from the market intermediaries/participants strictly by account payee crossed cheques / demand drafts or by way of direct credit into the bank account through electronic fund transfer, or any other mode permitted by the Reserve Bank of India. Stock Brokers shall not accept cash from their clients either directly or by way of cash deposit to the Bank Account of Stock Broker.
    Group Companies Members of : BSE, NSE, MCX, MCX.SX, CDSL, NCDEX, Broking Services, Depository Services, Portfolio Management Services, Member Area IPO Distribution, Insurance Broking
    BSE Clearing No.: 911 | SEBI Regn. No.: INZ000177531 (Cash/F&O) | NSE Clearing No.: 11858 | SEBI Regn. No. INZ000177531 (Cash/F&O/CDs) | MCX-SX Clearing No.: 11400 | SEBI Regn. No.: INZ000177531 (CDs) | CDSL DP ID: 30300 | SEBI Regn. No.: IN-DPCDSL-210-2003 | MCX SEBI Reg No.: INZ000032336 | MCX: 10665 | NCDEX: 00254 | NBFC RBI Regn. No.: 13.01851
    © Copyright 2018 Ajmera Associates Ltd ( ISO 9001:2015 Certified )
    Designed, Developed and Powered By CMOTS Infotech ( ISO 9001:2015 Certified )