Which are the best short term investment options in India?

In a highly competitive 21st century where advertising and technology have increased the desires of man, short-term investment options are something everyone looks out for. The idea of getting quicker returns is exciting and hence attracts people to such options. Besides the excitement, it is the skepticism behind locking away one’s funds for long periods that fuels such an option. While corporate institutions like Bajaj Finance provide the best options for both periods, following are some general short-term options. A g

Mutual funds:

In this option, a fund manager looks after your account by investing your money in stocks and bonds, in the form of a package, based on their experience. You get to choose the ratio of assets and liabilities in such a package depending on your appetite for risk and desire for returns. In an actively traded Mutual Fund, the returns are largely dependent on the experience and efficacy of the fund manager. They serve as a good short term option as in the form of an SIP (Systematic Investment Plan), one can choose a rather short tenor too. 

Gold

Gold has been a traditional investment option in India over the decades.  Possessing gold in the form of jewelry comes with its own risks such as safety as well as high cost including the charges for making gold. But considering the returns and newer options such as, nowadays investing in paper gold serve as cost-effective investments. Apart from investing in gold as a jewelry, you can also invest in gold ETFs and sovereign gold bonds. The tenor for which you hold the gold is up to you, hence it can serve as an effective short term instrument for making money on the invested amounts. 

Equity (Stock) Market

The stocks are a highly volatile asset class but most popular whenever short term investment options are discussed. There is no guarantee of return over a certain period of time as it is difficult to time your entry and exit in the stock market. You need to have a lot of research and skills to understand the behavior of the stock market to predict patterns and to buy the right stocks. Investing in stock is therefore not profitable to everyone. The only good part about investing in stocks is that they are able to deliver higher than inflation-adjusted returns compared to all other asset classes and if you’re trading day-on-day, these returns come in the short run.

Systematic-Deposit Plans by Bajaj Finance

The SDPs at Bajaj provide you stability and security while allowing you to set up a corpus in a structured way over a chosen period of time. Under this plan, you can choose to have the same or different tenors and accordingly receive the maturity amount on different dates or one defined date. 

The interest rate prevailing on the day of each monthly deposit will apply to it individually. The rates will vary depending on the tenor of the deposits. The tenor options range from 12 months to 60 months. You can even customise the day of the month on which you want to make the deposit- 3rd, 7th or 12th of each month. In SDPs, you can start small with a minimum deposit of just Rs 5000. 

Pre-mature withdrawals are allowed for one or more deposits provided the FD has completed more than 3 months from the date of its issuance. 

Depositors can also take a loan against each deposit keeping in mind the applicable norms. Considering Bajaj Finance has been accredited with the highest ratings of CRISIL’s FAAA and ICRA’s MAAA, your money and funds will remain safe too.

Hence, these are the short term investment options today and clearly it is SDPs that stand out as a lucrative as well as viable option. 

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