Importance Of Investment In Financial Instruments

By Author: Neha Sharma
Total Articles: 170
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"Investing money is one of the best ways to grow your corpus. By smartly investing your money in different avenues, you can grow it to meet different life goals such as education, wedding expenses, travel funds etc.

There are different types of investment products in which a person can invest his money. These can be either financial products or tangible assets. Tangible assets mean investment in a house, office complex, plot of land, construction of a building, gold etc. However, financial products are intangible in the sense they cannot be seen or felt.

Investing in financial assets is not only a quick way of growing your money, but it is also a highly regulated mode to grow your capital. These assets grow quickly and are a stable form of return. Return on many financial instruments is fixed which means your capital will have an assured growth and an income coming into your account. Financial instruments are convenient because they are online investment where everything can be managed in a few clicks.
Lastly, financial instruments are also a medium of growth for the country. Investing in financial instruments ...
... gives capital to companies seeking funds for further expansion and growth. This in turn benefits the country.

But which financial instruments are excellent online investment? Here are some of the best investment options in India:

1. Mutual Funds:
Under mutual funds, money pooled from different investors is collected and invested in a range of different assets. Mutual funds may invest in equities or in fixed income instruments of different durations.

2. Equities:
These are shares in an individual company. The price of equities increases or decreases based on performance of the company and the demand for the shares in the market. Equities can be invested in an initial public offer when the company lists on the stock market for the first time or from the secondary market where shares are traded.

3. Derivatives:
These include futures, options, interest rate swaps, currency swaps etc. These are technical instruments which need knowledge for investment.

4. Savings bonds:
These are fixed coupon bonds issued by the Government to provide guaranteed income to the investors.

5. Capital gains tax saving bonds:
These bonds can be invested in to save on capital gains incurred from selling a capital asset.

6. Inflation indexed National Savings Securities:
These securities are issued by the RBI and they give the investor a fixed return above the inflation rate. This gives the investor a guaranteed return over and above the fluctuating inflation rate.

Investing in these instruments requires study and precision. In case you don’t have the required expertise, you can avail specialized investment services that help you grow your capital based on your goals and risks.

Author Bio:- Neha Sharma is a finance student who loves to write in her free time. She has spent considerable time researching about investment services. Through her work, explains the importance of financial investment instruments