Investing for Salaried Employees

What to focus on?

1. Index Investing
2. Purchasing Bonds
3. List of stocks
4. Stock Investment Plan
5. Compound Annual Growth Rate(CAGR)

Basics

Risk

FD < Bonds < Equity

The lesser the risk the lesser the return. The return percentage should outweigh the inflation rate in order to not lose value.

Bonds

Options :

1. Mutual Funds
2. Direct Bonds

Purchasing safer bonds is important.
What to look for?

1. Secured
2. Senior

FD is also a bond, but a loss making bond. In saving account it is 3% and in FD it is 5%. Inflation at the point of this writeup is 8% ~ 11%.

We make a loss of 3% ~ 6%

SENSEX and NIFTY are 2 low commission Mutual Funds. Liquid Debt funds are profitable, but important to invest in companies with high trust.

Equities

Need to have knowhow.

Equity, typically referred to as shareholders' equity (or owners' equity for privately held companies), represents the amount of money that would be returned to a company's shareholders if all of the assets were liquidated and all of the company's debt was paid off in the case of liquidation.