RATIONALE

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India presents a vast potential for investment and is actively encouraging the players especially entrance of foreign players into the market. India is also one of the few markets in the world which offers high prospects for growth and earning potential in all areas of business.

In the current market scenario where there is more expenditure than one’s salary, inflation touching its high and fixed deposits going down day by day, thus net rate of return on the investments being below the inflation rate. To meet these growing requirements, the investors need to invest his disposable income to reap short as well as long term benefits. Those who do make diverse investments are able to squeeze maximum benefits.


Investment avenues in India

Savings form an important part of the economy of any nation. With the savings invested in various options available to the people, the money acts as the driver for growth of the country. Indian financial scene too presents a plethora of avenues to the investors. Though certainly not the best or deepest of markets in the world, it has reasonable options for an ordinary man to invest his savings. Banks are considered as the safest of all options, banks have been the roots of the financial systems in India.



Investment alternatives in India

• Non marketable financial assets: These are such financial assets which gives moderately high return but can not be traded in market.
Bank Deposits
Post Office Schemes
Company FDs
PPF

• Equity shares: These are shares of company and can be traded in secondary market. Investors get benefit by change in price of share and dividend given by companies. Equity shares represent ownership capital. As an equity shareholder, a person has an ownership stake in the company. This essentially means that the person has a residual interest in income and wealth of the company. These can be classified into following broad categories as per stock market:
Blue chip shares
Growth shares
Income shares
Cyclic shares
Speculative shares