Investments planned well can help to achieve the investor’s long term financial goals. However, if made wrong i.e not as per the risk appetite might create losses for the investor. There are many investment schemes available in the market carrying different risk-return characteristics that are suitable for different investors as per their risk tolerance. The schemes with high potential of returns are the one which also carries the high chances of generating losses on investments because of the high risks involved.
What are some of the best investment schemes offering high rates of interest?
The best investment schemes offering high rates of interest have different risks associated with each one of them. Investors can look into choosing the ones which are suitable to meet their requirements and match their risk appetite.
- Post Office Savings Schemes – Post Office Savings Schemes are the schemes offered by the IndiaPost, a government-backed postal services entity. POSS schemes have a wide reach in the country and is accessible to almost everyone in the country because of the large network of more than 1.55 lakh post office branches in India. Also, some of the post office schemes can be availed through the authorized bank branches.
The schemes offered by post office savings schemes are risk-free and provides safety pf capital because of the sovereign guarantee by the government.
Some of the post office schemes offering high returns are Senior Citizens Savings Schemes, Sukanya Samriddhi Yojana, Public Provident Fund, etc.
- Equity Mutual Funds- Equity Mutual Funds are the mutual funds that invest predominantly in the equity & equity-related securities of the companies. These mutual funds can be categorized on the basis of market capitalizations, themes, sectors, geographical diversification, etc. Among all investment options mentioned in the article, the equity mutual funds have the potential to provide the highest returns to the investors over the long investment horizons of more than 5 years.
The returns from equity mutual funds could be in the range of 12-15% for the investments over long investment horizons. Investors can look into making a portfolio of different equity mutual funds suitable to their risk appetite and which might help to reach the desired financial goals.
- Debt Mutual Funds- Debt Mutual Funds are the mutual fund schemes that invest a major portion of their assets in debt securities like the certificate of deposit, T-bills, commercial papers, money market instruments, bonds, debentures & others. As per SEBI Categorization, there are a total of 16 categories of debt mutual funds carrying different risk-return characteristics, investment rationale, duration & underlying securities.
Some of the best categories of debt mutual fund offering good net returns of 6-8% along with carrying a low risk include Banking & PSU Funds, Corporate Bond Funds.
- Bank Fixed Deposits- These are the time deposits with the banks & financial institutions. The tenure of the Fixed Deposits varies from days to years and investors can select the one as per their requirements. These deposits carry very low risk of investment and therefore are also one of the safest options of Investments. They provide returns in the range of 6-7% and vary across banks. For higher interest rates, investors can look into invest in Bajaj Finance FD which offers the highest interest rates of up to 7.85% p.a.