How To Choose Between Fixed And Market-Linked Investment Avenues?

Both fixed income and market-lined investments have a role to play in creating wealth and achieving goals. Read on to find out how to put them to best use.

- Sanjiv Puri

As an investor, one wishes for the best of returns at no risk of lozzsing the money. If wishes could be horses, as there doesn’t exist any such investment product. In reality, risk and returns are inversely related i.e. with more risk comes higher returns and vice versa.

The decision to choose between the two is fairly simple. For a goal that is still few years away, the reason to take risk might still exist while for goals that needs attention within few months or years, it could really be a risky venture.

For investors, the choice between fixed- income investments and market-linked investments becomes more pronounced when it comes to meeting goals. Let’s see, what they are and how different investment avenues may be put to use while chasing the goals.

Fixed-income investments:

Interest- bearing investments such as bank fixed deposits, company deposits, post office small savings products and bonds are popular among fixed-income investors. They come with a fixed return and a pre- decided maturity period. They therefore belong to the debt-asset class.