What is Investing?
Investing is putting your money in a ‘Financial Instrument’ with a view of earning a desired return or income in the future. For example- Stocks, Real Estate, Bonds etc.
The mechanism of investment works with the simple concept of trade, where one exchanges money for asset classes, which in future generate wealth.
For Example- An individual buys one share of company ABC for Rs. 100 and after five years the price of one share becomes Rs.500. So, the profit generated here is Rs. 400 which is a 400% return on the investment.
Let’s dive deeper into investing. Risk and Return are the two pillars of any investment. For any investment higher the risk higher the return and vice-versa. Risk is defined as the uncertainty linked to the investment, in layman terms it is the opposite of what is expected to happen. On the other hand, return is the key attractive factor towards any asset class. It is the change in the money value of the asset class over a period of time.
Types of investors on the basis of Risk-Reward profile-
- Aggressive
- Moderately Aggressive
- Moderate
- Moderately Conservative
- Conservative
‘Aggressive’ being the high risk tolerant investor and ‘Conservative’ being more risk aversive.
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Swastika has a hybrid model in which you can trade online and in a hassle-free way through our mobile app Swastika. You can also trade with the help of a dealer.
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