Five Assets To Invest In FY26

As the world becomes more interconnected, the global economy has become less predictable, as evidenced by the disruptions caused by the Covid-19 pandemic.

This uncertainty has shifted the focus toward long-term financial well-being, particularly in light of rising living costs and inflationary pressures.

In response, many investors are moving away from traditional, low-risk methods like fixed deposits, opting instead for riskier profiles in search of higher returns. A secure financial future requires a research-based, diversified investment strategy. Such strategies provide greater stability during volatile times and help mitigate risks.

Since each investor has unique priorities and risk appetites, adopting a tailored and research-driven approach can lead to a more stable financial future. Striking the right balance between returns and risks is crucial. In this context, asset allocation plays a significant role in managing risk. By diversifying investments across various asset classes, one can minimise the potential for loss.

• Direct Equity: Direct equity refers to the shares of a company that you can purchase on the stock market, making you a partial owner of that company. As a long-term investment option, direct equity allows you to benefit from the company’s performance. However, it is important to note that investing in direct equity carries a high level of risk. Therefore, conducting thorough analysis before making an investment decision is crucial.

• Equity Mutual Funds: Equity mutual funds primarily invest in the stocks of publicly traded companies, offering diversification by spreading investments across multiple stocks rather than just a few. These funds are managed by professional fund managers who are experienced in analysing and investing in the stock market. You can invest in them via systematic investment plans if you are uncomfortable with a lump-sum investment. Since different mutual funds carry varying levels of risk, it's important to balance the potential for returns with your own risk tolerance.

• Unit-Linked Insurance Plan: A Unit-Linked Insurance Plan combines investment in stocks and bonds with life insurance. A portion of your premium is invested in assets, such as equity and bonds, while the remainder goes towards life insurance coverage. It is ideal for those looking for long-term exposure to the stock market as well as insurance coverage. Since the ULIPs are provided by life insurers, the payments towards ULIPs are called 'premiums'.

• Fixed Deposit: Fixed deposits are one of the most popular investment options in India as they offer guaranteed returns. Unlike mutual funds and equity investments, the returns are independent of market performance. It ensures that you get a definite return on the principal investment at the end of the tenure.

• Real Estate: Real estate is one of the most popular investment options for generating long-term returns. You can invest in real estate by buying a residential or commercial property or by investing in real estate investment trusts. The returns can vary according to the location of the property and market trends. One major risk of investing in real estate is that it can be difficult to liquidate it quickly.