In the current times, due to inflation and uncertainty of the future, investing is not a luxury but a necessity. However, when investing for a short period like a year, it is very important to maintain a balance between risk and return. Social media influencer and investor Ankur Wariku has mentioned three funds that can help keep your money safe and give good returns for a period of one year.
1. Liquid Mutual Funds
This is the best option for those who do not want to lock their money up for too long.
Where to invest: These funds invest money in short-term government and private sectors like treasury bills, commercial paper and certificates of deposit.
Advantages: The risk is very low here and money can be withdrawn very quickly if needed.
For whom: This is ideal for you if you are looking for better returns than a regular savings account and security like a fixed deposit.
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2. Short-Term Mutual Funds
If you want a little more return than liquid funds and are willing to take a little risk, you can choose this.
Where to invest: This fund usually invests in debt instruments with a tenor of 1 to 3 years.
Advantages: There is a possibility of getting better returns here compared to bank FDs. However, there may be slight fluctuations (Volatility) according to the market.
For whom: Those who want higher profits than bank FDs by investing for one year.
3. Corporate Bond Funds
Corporate bond funds can be an excellent option for a little more return.
Where to invest: This fund invests in bonds issued by various reputable companies for their business needs.
Advantages: Investing in highly rated (AAA rated) companies has low risk and the returns are quite attractive.
Warning: There is credit risk here, so before investing, you should check which companies the fund is investing in.
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Which is best for you? (Comparison table)
Based on what Liquid Fund Short Term Fund Corporate Bond Fund
Risk Very low Medium-low Medium
Return Better than savings account Higher than liquid fund Highest (among these three)
Liquidity Money can be withdrawn very quickly Medium Medium
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It is wisest to focus on safety when investing for a period of one year. According to Ankur Wariku, all three options are capable of performing much better than bank savings accounts.
(Note: The information provided here is for informational purposes only. It is important to mention here that investing in the market is risky. As an investor, always consult an expert before investing money. Timesbull.com never advises anyone to invest money here. This share market related news is provided here for educational purposes only. We do not make calls or tips about any shares.)