There are two main ways to invest. Either you can invest monthly to create a corpus of your dreams, or you can invest the money t you have already saved.
If you already have a corpus built, you will either be trying to accelerate your corpus growth or park it safely. The choice here depends on what type of corpus you have and what your goals are with the same.
For every goal, there could be a different investment option that is suitable as well. Let us look at a few options that you can choose from to park your lumpsum money according to your goals.
Stock market investments
One of the most beneficial options to choose from is a stock market investment. Here, you invest the money in stocks of different companies. Such investments are known to have the highest potential for growth, but at the same time, they carry a higher risk element as well. Hence, the option is suitable if you have a larger risk appetite.
You can invest for growth as well as safety in stocks. For instance, you may invest in growth stocks if you want to accelerate your capital. At the same time, you could invest in large-cap stocks if you want slower growth but better stability. Still, stock market investments have a comparatively higher risk than conservative options.
One factor to keep in mind if you are fancying stock market investment is monitoring. Since you are in the driving seat of your investments and stocks could move a lot in shorter periods of time, you should keep a close eye on your portfolio’s performance regularly.
Bond investments
Bonds are an investment option that has contrasting characteristics to stock market investments. Bonds are debt instruments. It is a way for companies and governments to raise money from the public. Bonds are sold as units. The price you pay for bonds is the money you loan the issuer. For the money you loaned, you will continue to receive interest payments till the end of the maturity period. At maturity, you will get the initial investment (face value) back in most cases as well.
Here, the interest rate is fixed. It is not dependent on market conditions. Hence, they come with less risk as well. But the return potential is lower when compared to stock market investments. Hence, it is a wise option to safely park your corpus, and at the same time, you will get decent returns as well.
Mutual fund investments
As said above, stock market investments may require you to monitor the same regularly. Mutual funds are designed to make investments easy here. Instead of you picking the securities and monitoring them on a daily basis, mutual funds have managers who will do the same.
In simple terms, mutual funds are pre-set portfolios created and managed by experienced fund managers according to the theme of the fund.
For instance, if the theme of the fund is aggressive, the portfolio may contain more aggressive options (e.g., equities).
Mutual funds give you a wide variety of options to choose from. For instance, if you are looking to park your funds to accelerate the same, you may choose an aggressive fund. At the same time, you may choose a conservative fund if your aim is to safely park your corpus during market uncertainties.
Conclusion
There are multiple investment options out there that help you to park your corpus. But the important thing is to understand what your investment goal is and choose an option according to the same.
