“Ups and downs in life are very important to keep us going, because a straight line in ECG means we are not alive.”
Rules of equity investing:
- While you are investing in the stock market, give the same patience you give with real estate. A good equity portfolio needs five years of patience, ten years you see consistent returns.
- Remember that the risk of choosing poor products will land to bad returns.
- Diversify across asset classes to reduce the impact of adverse market movement as all the assets class do not perform in similar fashion at a given period of time.
- Do not invest in any product that locks you into a particular company or asset manager.
- If you want to invest in managed funds, start learning to know the tactics of the market.
So investors need to remember that if they give the same respect to the equity, which they give to real estate, it would be a smoother ride with fewer costs.
Are Equity shares better than equity funds?
Investing directly into shares has a lot of complexity that an individual person has to take care of. You have to examine stock and assess if the valuation is attractive. Investing in stocks is a dynamic process because the scenario of business is changing frequently because of competition. And one should also understand how the stock exchange like Sensex and nifty functions. So one should need higher initial capital to build a well-diversified portfolio.
If we take the case of equity funds it is a more convenient way to enter stock markets. Where the fund manager would take care of your portfolio. You need not worry about the changes happening in the stock market and other decisions like portfolio management. Moreover, you can start with a systematic investment plan (SIP) in mutual funds with low as Rs 500 every month. In short, you can achieve a similar but a safer level of at a smaller amount.
Fisdom gives you the option to invest in Mutual funds are the best way which gives exposure to your investments. So being a smart investor, why to invest in real estate when equity gives the best returns to your investments? Being an investor you have to understand that equity does take time and you need at least seven to ten years of patience to get your returns. You have to understand that you won’t double your money overnight, but you would be surely getting your returns which is between 12-15 percent a year.