Invest Invest Invest.....This is a saying which one hears all the time. An investment in stocks is like a rising tide which lifts all boats. When that tide rises your boat better be in it. Isn’t this an age old saying drilled in our head? Land appreciates like no other investment in India The population boom is on and India will always have a shortage of land."As The Landlord Sleeps He Grows Rich". One has heard this saying so many times that one can remember this even in ones sleep. But are these investments really that easy? Should One Just Buy Whichever Stocks One Wants? Should one Wear His Heart On His Sleeve and invest heavily in sectors towards which he is highly biased. What about an investment in land? Should one just buy whichever land one sees based solely on emotions or should emotions take a backseat to sound logic. This is a dilemma which worries each of us day in and day out. Is there a solution to this problem? "Yes" Financial awareness and an investment in financial knowledge is the solution to that never ending problem. An investment in knowledge for oneself is the greatest investment one can make. Another investment equally important is time."Time Is Money". An investment in financial knowledge needs to be made at the right time. What Better Time Can This Investment In Financial Knowledge And Awareness Be Made Than In Ones Youth. I would like to remind you that the team of Financial Planners at IndianMoney.com are always there for you to plan your financial needs in a most effective and efficient manner. You can explore this unique Free Advisory Service just by giving a missed call on 022-6181-6111.
One notices an extreme volatility in the stock markets in recent times. On one day the Bse Sensex crashes by 500 points. The next day it rises by 500 points. What Can One Do Under Such Extreme Volatility? Doesn’t one need to ring fence ones portfolio against volatility in the stock markets in order to protect all that hard earned money invested in the stock markets. Of what use is filling a leaking bucket with water. All ones pursuit towards the goal of immense wealth will come to nought. Can One Adopt A Defensive Strategy In a Highly Attack Oriented or Growth Oriented market such as an equity market? The answer to this is a resounding “Yes” .This is similar to conquering enemy territory and holding this territory against the enemy counter attacks. This provides a cushion or a fence around our hard earned investments and this helps to protect them in times of volatility. This prevents a hard landing on rocky ground. One should always invest part of one’s portfolio in defensive sectors such as Pharmaceuticals and Fast Moving Consumer Goods. An investment in these stocks leads to very less fluctuations in periods of drastic fall in the markets as is what is happening a lot in recent times. Similarly in periods of a spiking in stock market indices the rise is not very high. This is a trade off which one has to make. In difficult times which are the first purchases which are shelved. Isn’t it that expensive chocolate, costly perfume, purchase of a new car or laptop, or expensive furniture? It definitely isn’t the toothpaste. So Why Does This Happen? One cannot cut down on medical spending and basic purchases like toothpaste, soaps, cosmetics, cooking oil and washing powder just because there is a recession. This is a reason why these stocks are termed as defensive stocks as they hold up in hard times .Let us consider an investment in interest rate sensitive stocks such as infrastructure, automobiles or banking. If one were to notice a few months back in rising markets these stocks hit the roof. Nowadays they languish at the bottom. Cyclical and commodity stocks such as metals and capital goods move in a direction opposite to that of the defensive sector stocks. The metal stocks in India have been severely hit in recent times and coupled with Political factors mining and metal stocks have hit rock bottom. The defensive stocks have a Beta value less than 1.0 and are classified as less risk and less return stocks. This Helps One To Easily Identify A Defensive Sector Stock.
So how does one navigate the deep waters of the stock markets. One should go for a combination of both attacking and defensive sector shares. In periods of great boom in the stock markets one will notice that stocks with Beta more than 1.0 or stocks of high risk, high returns will rise rapidly. These could be automobiles, Infrastructure, Metals and Banking Stocks. These stocks are very necessary for one to enrich oneself and become a Millionaire."A Single Day Of Sorrow Can Make One Forget Many Years Of Joy". It is in times like these that one remembers those defensive stocks. A healthy combination of both growth and defensive stocks is necessary for a good portfolio. "We Are What We Repeatedly Do. Excellence Is Not An Act But A Habit".
Companies in Real Estate mainly focus on luring customers towards the purchase of Apartments and Villa’s. There is very little focus on the purchase of land parcels or land plots. No doubt the demand for apartments is very high in Metro’s and is seen rising in Tier -2 cities where the focus is on Nuclear Families. However the demand for individual homes is still high and that land plot or site can contribute to a heavy appreciation in one’s profits. However can one take a leap without a look? No definitely not.
I would like to end this article with the famous phrase I Am Not A Product Of My Circumstances. I Am A Product Of My Decisions. Remember always make the right decisions and your finances will play the part. Getting rich is then an inevitable process. Invest In A Seasoned Campaigner
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