Demonetization is the latest trending topic in our life and the impact of Demonetization is not going to end so easily. If you are not aware about what is Demonetization, then let me tell you that Indian Govt has discontinued the Rs 500 and Rs 1000 notes as legal tender ask everyone to deposit their currencies to banks and get exchanged.
This step has increased the cash flow towards banks and every bank has been flooded with money. Now as the system has enough money, then why to offer more interest on deposits and that’s why bank fixed deposit schemes has lost the interest rates drastically.
You can keep a track of the latest bank FD interest rates in coming days. It is expected that from January 2017 onward the interest rate of banks fixed deposit scheme and the savings bank account will be almost similar. That means one of the best investment option in India is going to lose its charm in coming days.
Best Investment Options After Demonetization in India
Now the biggest question is where to invest money to get good return after demonetization? Well, when many common people will start finding FDs less attractive there are more ways to invest your money to get good return on long run. let’s explore them one by one.
Real Estate: Although real estate sector is going to get the biggest hit after demonetization, I think this sector will attract more customers as well due to price reduction. It is expected that the real-estate market is going to get a correction by 20% to 30% in next few quarters which is a very good sign for first time home buyers. Specially for them who are planing to buy a home to stay.
Stock Market: You might have watched Sensex has fallen in last few days after the demonetization news. This is nothing but the market correction and volatile nature of the stock market which will definitely get stable once demonetization effect will be normalize. And Stock market is going to get the reward after this. If you are an investor who can take some risk, then Stock market is the best place as Indian economy is going to get huge boost after this demonetization move.
Mutual Fund: Well, I think why you should invest in mutual funds will answer the previous points only. But mutual fund is for them who are not at all ready to put their money after one company and track the performances. rather investing is various sector oriented stocks to minimize the risk of Stock market and get good return in long run.
Invest in Gold: Do you think gold is going to lost its glitter after demonetization? The answer is Yes, only the physical format of gold is going to get huge hit by this move. But if you know how to invest in E-Gold then you know how much return you can get in long run and how easy it is to handle e gold compared to physical gold.
Fixed Deposit: Even though Fixed Deposit schemes will not offer high interest rates, I believe still FDs will be the best short term investment option in India. Whatever the return it is, your money will not be idle in your bank accounts, rather earning some interest through FDs. And that is true for everyone who is ready to invest money for a very short period of time.
So, do you think demonetization drive has shattered your investment portfolio? In short term this is completely true as our economy need to corrected and get refreshed with the right valuation of everything we transact these days. That means in coming days we can expect various price reduction in our every life commodities and needs which will again justify our purchasing power as per our income capacity.
It’s better to start taking little bit more risk and explore more about mutual funds. A systematic investment approach in mutual funds in long run is going to provide a very good return. What is your preferred investment option in India after demonetization? Write a simple comment below and share your thoughts on this.