With all the investment avenues available, diversification remains the key to building an effective portfolio that ticks all of the investors boxes – liquidity, low risk options for an emergency fund, high interest, passive source of income.
Rising inflation, variants of Covid, falling interest rates and dividend rates have made the investment landscape challenging for retail investors. “Since the outbreak of the covid outbreak, Indian stock markets have seen a huge influx of new investors attracted by the bull market rally and looking to profit from the year and a half bull market,” says Anshul Gupta, co -Founder, Wint Wealth.
Consequently, investors are increasingly looking for options that can pay higher interest rates and are less vulnerable to market volatility. One such instrument track is non-market fixed income assets that are available in various time frames at any time, from one year to 10 years.
Gupta points out, “Investors are free to choose to invest in tranches based on their goals and needs. Another opportunity offered by this asset class is to create passive sources of income which are offered in the form of interest rates at a frequency specified by the issuer – monthly, quarterly, semi-annually or annually.
He further adds, “With all the investment opportunities available, diversification remains the key to building an effective portfolio that ticks all of investors’ boxes – liquidity, low-risk options for an emergency fund, high interest, source passive income”.
Note that while no one investment avenue can offer all the features mentioned above, experts say that investors can make sure to include various investment assets that can meet their diverse needs for a trip. strong financial.
Another direction Gupta says retail investors should be aware of is to proceed with caution. “Digital percolation and increased consumption of social media has exposed and encouraged investors to experiment with their gambling,” says Gupta.
He explains: “We are currently in the middle of the cycle, where policymakers are restricting, but the overall earnings cycle has recovered and demand is doing well, regardless of policy. Stock markets are performing admirably, but keep in mind that reflation trading has already accounted for a large portion of excess returns. This mid-cycle phase will last about one to two years, if not longer.
However, even amid the elation, experts say it’s a good idea to be on the safe side for retail investors. “Retail investors, in particular, should exercise extreme caution due to their growing exposure. Especially since many of them entered the market as stocks were hit by the pandemic last year and subsequently peaked in the rally. In other words, they never lost money or faced a downturn,” he adds.
Therefore, it is essential to be informative and educated about where your money is being funded.
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