INVESTMENTS

OVERVIEW

Investing is putting money to work to start or expand a project – or to purchase an asset or interest – where those funds are then put to work, with the goal to income and increased value over time. The term “investment” can refer to any mechanism used for generating future income.

MUTUAL FUNDS

A mutual fund is a type of financial vehicle made up of a pool of money collected from many investors, and invested by an experienced fund manager in assets and securities like stocks, bonds, etc.

Categories on the basis of investments in asset classes:

  • Money market Funds
  • Bond funds
  • Stock funds
  • Debt mutual funds
  • Balanced funds
  • Monthly income plans (MIP)
  • Gilt funds

Categories on the basis of investment in types of securities with an asset class:

  • Sector-specific funds
  • Index funds
  • Large capital funds
  • Small capital funds
  • Multi-Capital finds, etc

BONDS

A bond is a fixed income instrument that represents a loan made by an investor to a borrower where investor receives a fixed interest for a specific time period.

Types are:

  • Corporate bonds
  • US treasuries
  • Municipal bonds
  • Government agency bonds

CORPORATE FD

Company Fixed Deposit (corporate FD) is a term deposit which is held over fixed period at fixed rates of interest. Company Fixed Deposits are offered by Financial and Non-Banking financial companies (NBFCs). The maturities of various company fixed deposits can range from a few months to a few years.

Its key benefits are:

  • Higher returns
  • Flexibility
  • Liquidity
  • Lower risk