Looking Beyond Stocks

Looking Beyond Stocks

07 May 2018

An investor in the present times needs to look at investing in multiple assets classes, the dynamism in the approach reduces risks and improves profitability. One of the Strategies for any investor would be to find out if an asset class has delivered consistent returns for a long time. This indicates that asset class has great probabilities of continuous increase in the value. Also, it is advisable to cash in your profits from time to time as you can expect the change in trend sooner or later if an asset class performs extremely well within a short span of time. Investors can maximize returns by looking at five asset classes: Commodities, Gold, Equity, Debt and Real Estate. All these assets classes take into consideration various related developments in domestic as well as international markets.

Equity - Investors have to understand that equity and indices are two different things. With the advent of financial markets and newer instruments, it is possible to have various trading options both in equities and indices.

Debt - Here most investors have a problem with low returns on fixed deposits. It is for sure that debt instruments will provide good returns if inflation is on the lower side and these will always protect the capital.

Commodities - This asset class which is traded across all economies and has the highest volumes globally. You can expect transparency in this asset class because the price is being determined by demand and supply, and not controlled by vested interests.

Gold - Has seen a rising trend in last two decades and is a much-preferred class in India. Gold has a tendency to attract the maximum amount of floating global liquidity. It is regarded as the safe heaven amongst all asset classes. Gold price typically has a direct relation to tensions in the global geopolitical scene. It means when the tensions increase the price of gold increase and vice-versa. Also, Gold is widely considered an inflationary hedge because the owner of gold is protected (or hedged) against falling currencies because as inflation rises and erodes the value of the currency, the cost of every gram of gold will rise as a result.

Real Estate - Movement in the income curve of individuals and corporates decides the demand for residential or commercial property. Investors can start looking for possible good investment opportunities with respect to real estate market.

An ideal distribution in the portfolio is based on the long and short terms needs of the investor, his age and many other individual factors. The allocation in percentage may vary but it is advisable for every investor to have some percentage of his portfolio allocated in each of the asset class. This allocation will ensure much-needed stability in the investor's portfolio.

Most popular Financial market exchanges :

Equity: Bombay Stock Exchange (BSE), National Stock Exchange Limited(NSEL)

Commodities: Multi-commodity Exchange Ltd (MCX), National Commodity & Derivative Exchange Ltd (NCDEX)

Regulator: Securities and Exchange Board of India (SEBI)

Founded in 2005 by new–age entrepreneur Abhishek Bansal, the Abans Group has evolved into a globally diversified conglomerate, providing expertise in Broking Services, Non-Banking Financial Dealings, Financial Services, Agri-Commodity Services, Warehousing, Realty & Infrastructure, Gold Dore Refinery & Manufacturing, Trading in Metal Products, Pharmaceuticals, Software Development & Wealth Management. The Group is a comprehensive financial and non-financial services and solutions provider, aiming to provide end-to-end solutions to its clients.