Investment is a great way to secure a better tomorrow. Whether you are planning for a comfortable retirement, seeking passive income, or achieving any other financial goal, investing can lead to financial prosperity.
Investments can be broadly classified (on the basis of duration) into short-term and long-term. Short-term investments can be considered for achieving financial goals which are in the near timeframe or to earn quick returns. At the same time, long-term investments are more concerned with long-term goals.
However, to achieve any financial goal having robust equity portfolio management is imperative. Consult You can take guidance from an expert SEBI-registered investment advisory firm that can help you align your investments with your goals.
Short-Term Investment: Definition
When you invest in a financial instrument that will mature or can be withdrawn in a short span of time is a short-term investment. This “short span” usually ranges from a few days to up to three years. This type of investment is made in order to achieve your short-term financial goals. You can also utilize these returns on investment to invest in a better and longer instrument.
In this blog, we list some of the best short-term investment options available to an average Indian citizen.
Best Short-Term Investment Options In India
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Stocks and Derivatives
Stocks and derivatives are high-risk and high-return investments that can be traded in the primary or secondary market. They can be short-term or long-term investments, depending on how the investor treats themDepending on how the investor treats them, they can be short-term or long-term investments.
Since shares have no minimum holding period, they can also be good short-term financial instruments. The returns, however, depend on the market condition. Moreover, you can also invest in derivatives for short-term purposes. However, trading in derivatives can be complex and risky, requiring a thorough market understandingunderstanding of the market. Hence, you must consider opting for equity portfolio management from a reputed advisor.
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Gold
While investing in gold is traditionally viewed as a long-term investment opportunity, short-term investments also exist. You can capitalize on gold’s price fluctuations through instruments like futures, options, and ETFs.
A thorough understanding and analysis of the market are essential to maximize profits.
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Liquid Mutual Funds
Liquid mutual funds are highly liquid compared to traditional ones. They primarily invest in short-term, highly liquid assets like money market instruments, treasury bills, etc. You can easily redeem your investments, providing you with are funds that are highly liquid compared to traditional ones. They primarily invest in short-term to highly liquid assets like money market instruments, treasury bills, etc. You can easily redeem your investments providing you easy access to your funds.
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Savings Account
You can open a savings account in your bank and deposit money in it. You will receive interest on the amount of money you deposit. This is considered a short-term investment since you can withdraw and deposit money from the account anytimeat any time. With digital transactions and online banking, it has become even easier to do so. However, if you save money in this account for a certain period of time, you receive returns accordingly.
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Recurring Deposits
The recurring deposit accounts allow you to deposit money in a recurring format, hence the name. Instead of depositing a fixed lump-sum amount and locking it for a specific period of time, a recurring deposit allows you to deposit the money in installments. These accounts have a tenure that ranges from 3 years to 10 years.
It has an initial lock-in period of 1 month. It can m prove to effectivelybe an effective way to multiply your money in a safe, secure, risk-free environment with a fixed return rate.
Summing It Up!
The above-mentioned options are some of the known ones for short-term investments. However,It must be remembered that short-term investments mean exploiting market volatility and seizing immediate opportunities, which may be highly risky. Hence, you must trust a professional SEBI-registered investment advisory firm to make informed decisions.
Reference links:
10 Best Short Term Investment Plans with High Returns in India 2024 (policybazaar.com)
Top 6 Short Term Investment Plans in India for Best Returns in 2024 (turtlemint.com)
9 Best Short Term Investment Options In India – Moneymint
Best Short-Term Investment Options Right Now – NerdWallet
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