2020 is going to be a year of growth and opportunities. With the growing opportunities, there will be more funds and a place for investment as well. As 2020 is just around the corner, most of the investors will be ruminating on their long term investment plans. Keeping the current financial situation in mind, below are a few personal finance tools that as an investor you must consider to invest your money in a more profitable way.
Midcap unity funds
The midcap fund is basically a type of mutual fund under which the accumulated corpus will be invested in small or medium-sized companies. The best thing about these funds is that they tend to grow as more investors join their bandwagon. Experts of the industry keep recommending midcap funds and specifically the ones with a three-year time frame. As per experts different valuations have been corrected, and are now priced economically priced. The discount when it comes to Price-Earnings ratio of midcaps to large-caps is now at a 7-year high.
According to the investment experts of the industry, around 10 percent of your investment should be reserved for Gold to build a strong investment portfolio. It is referred to as a traditional investment tool that is designed to offer huge returns in 2020. The same would be expected to rise to Rs. 41,000 – 41,500 per 10-gram level by Diwali next year. Many people consider it as an obsolete form of investment. However, it is a fact that during a volatile time, gold does well and leads to capital appreciation over a long tenure.
Insurance is always a good option to invest your hard-earned money as it offers the required protection during rough times. Insurance should always be there in your investment portfolio. A health insurance plan and term insurance have become a necessity when it comes to complete protection. During hard times, it can become a support to deal with unwanted situations and will always be there to provide the needful financial assistance. There are multiple situations when your savings would not be enough to deal with any unfortunate event, in such circumstances a strong insurance plan is all you need.
ULIPs is again an insurance plan with huge returns. The plan comes out with the benefit of tax-free withdrawal, low-cost availability, structuring liquidity and provides ease when it comes to switching funds. Many insurance companies have now dropped the premium allocation charges. Even many insurers are giving back the mortality charges at the time of maturity. With all such benefits, Ulips has already become a strong investment tool. Investors are putting their money on the basis of risk capacity, allowing them to balance their portfolio. Insurance companies say that with this plan, portfolio yield can easily surge by 200-250 bps.
Debt Mutual Funds
When it comes to returns and performance, the mutual fund industry has recorded a promising performance. As per the study and reports, for the eleventh consecutive month, the inflows of SIP have crossed the Rs. 8,000-crore mark. It has become an alternative to fixed deposits where debt mutual funds can help you with a better yield. The concentration of the involved risk is also very low as compared to others. It’s important for open-ended funds to keep their investors in the loop about the performance of products assist them in making an informed choice whether it is about exiting or remain with the same
In simple words, wealth creation is basically all about a bend. It is a mixture of fixed-income and market-linked investments. A part of the same is dedicated to generating significant returns while the other one is committed to meet the investment goals. It is always advisable to hold a portfolio consisting of different financial tools. With foreign portfolio investors who are turning buyers and flushing ₹2,750 crores in the secondary market and domestic players, despite remaining sellers, bringing in ₹1,406.67 crores. Overall, the investment market is getting a much-needed push.
With companies of different sectors including IT, cement and consumer sector, the earning sector has started growing positively and meet desired results. According to the analyst of the industry, they don’t see a big fall for the Indian markets from the current level. With all such factors, it is simple that 2020 is going to be a much better year in terms of investment with the right instruments, you can easily aj advantage of the same. There are multiple platforms that you can explore for huge returns.
Just choose the right investment options to invest your hard-earned money, check your needs properly and make an informed decision accordingly.
Views expressed in this article are a personal opinion of Naval Goel (CEO & Founder of PolicyX.com).