Hi Friends, Welcome back to fingroow .Today we are going to discuss Traditional Investment opportunities & Modern Investment opportunities. So we start with what are the various investment opportunities available in the market.
· Traditional Investments-: Normally in the Financial market, there is one line which everyone should follow. The higher the risk higher the returns & lower the risk lower the returns. The Traditional investment follows lower the risk lower the returns. The Traditional Investment provides the fixed returns with low risk or no risk also, But the returns are lower as compare to modern investment opportunities. Below are the opportunities for traditional investment.
1. Saving Accounts-: In the current situation, almost 75-80% of people have a savings account. Saving account provides 3-5% of returns on your investment & you can withdraw your investment at any time. We can say that in saving accounts the risk is minimal.
2. Fixed Deposits-: In the ’90s fixed deposits were famous for the investment opportunity because the fixed deposits provide returns of 5-7% PA with no risk. But in Fixed deposits, your investment has a lock-in period, in a certain situation you can withdraw your investment, but the bank will charge some penalty.
3. Gold-: Till today gold considers the best investment opportunity for lower-income & middle-income people. Gold is the most liquid investment, This means you can easily sell the gold in the market & get your investment back. Normally gold is always appreciated, so most people decided to invest in gold only.
4. Properties-: People also like to invest in properties as it provides the highest returns in the long run, but it totally depends upon the location of the plot. Majorly high net-worth people consider this as investment opportunities because it requires a high investment amount.
· Modern Investments-: Modern investments provide a good amount of returns but it also comes with some amount of risk. Normally Modern investment is focused on the sector which was ignored in the traditional investment. Modern investment is more focused on Capital Market investments. Below are the investment opportunities that are available for the investments.
1. Smart Deposits
2. Mutual Funds (Domestic & International)
3. Share Market
4. National Pension Scheme
5. Digital Gold
6. Insurance
We will discuss every opportunity in separate blogs as they are more important for the investments. Now we will discuss the difference between Traditional & Modern Investments.
· Difference between Traditional & Modern Investments-:
1. If we compare returns then we can say that The modern investment provides the average return of 12-18% PA. & on the other hand, the Traditional Investment provides 4-8% returns PA. So definitely Modern investments are good for investment opportunities.
2. If we compare the risk then Modern investment is riskier as compared to the traditional investment, Because in modern investment almost 80-85% of investment is into the Capital market, So this will provide you the higher returns but it will also increase your risk.
· Opinion-: My Personal opinion no one should depend upon only one investment type. If we only invest traditionally then we will get lower returns & on the other hand, if we only invest in a modern way, then we might be caught into a high-risk investment. We should combine both investment ways. My personal opinion is you should use a 70-30 ratio for your investment, 70% into modern investment opportunities & 30% into traditional investment. This will may differ as per your risk appetite.
That’s it for this blog in the next blog we will discuss the National Pension scheme. Thank you,