In India, safety always comes first. It comes with an additional cost. How much would you pay for safety and risk free income?
The topic for discussion here is safe fixed deposits and risky equity investments.
“Risk comes from not knowing what you’re doing” – Warren Buffett
Fixed deposits are term deposits which involve locking in your money for a fixed rate of return for a fixed term. Most people invest their savings in fixed deposits. But can we do better than that?
Equities allow individuals to own businesses listed on exchanges in public markets. Index is a benchmark to track the general performance of listed businesses and often used to calculate returns from equities. In India, Sensex or Nifty are the major indices that people track.
Let us analyse through this article the pros and cons of investing in fixed deposits vis-a-vis equities.