Volume 5, Issue 6, June – 2020 International Journal of Innovative Science and Research Technology

ISSN No:-2456-2165

Analysis of Various Investment Avenues in India

Priyanka Subhash Panpaliya Sanket Sanjay Bajaj
PG Student PG Student
Department of Management Studies Department of Management Studies
Sinhgad College of Engineering, Sinhgad College of Engineering,
S.No.44/1 Vadgaon(BK), S.No.44/1 Vadgaon(BK),
Pune-4411041, India Pune-4411041, India

Dr. Mamta Mishra

Professor
Department of Management Studies
Sinhgad College of Engineering,
S.No.44/1 Vadgaon(BK),
Pune-411041, India

Abstract:- This research paper is study and analysis on increase their standard living and also they can increase the
various Investment avenues available in India. In this capital of the companies. Investment can contribute
research paper, we study three investment avenues are economic growth and wealth. Investments avenues also
equity's, Mutual Fund, Bank FD's. It is identifying great provide many benefits to the investors as well as to the
options to the investors to put their money in a wealth whole economy.
avenue for beautiful income. By increasing investors'
economic wealth, investors can contribute to economic  Investors
growth and economic wealth. This analysis helps the Investors means the person investing his small savings
company from where companies can have raised the into various investment avenues categories, such as Gold,
capital through the market. This study helps the Land, Fixed Deposit, PPF, Debt Funds, Bonds, Equities,
Investors, corporates, and many more, to benefit in etc., with the intention to earn high profits to the investors.
increasing their financial wealth. It is a plan to make a
habit of investing from small savings, which is made to  Investment
guide an investor to Select the most suitable investment Investment means to put some part of the amount in
portfolio that will help them to achieve their financial other avenues which give high returns. Most investors want
goals within a given period of time. There are some to make investments in such a way that they get a sky high
mantras for investing “Higher the Risk, Higher the return as soon as possible without bearing the risk and
Return'', “Analysis or Prevention is better than to rectify without losing the principal money that they have invested.
the mistake”. This is the reason why investors are always on the lookout
for top investments plans where they can double their
Keywords:- Risk and Return, Investment Planning, money in a few months or years with little risk. It is a fact
Investment Analysis. that investment products that give high return with low risk
do not exist.In reality higher the risk, higher the return, and
I. INTRODUCTION vice versa. While selecting investment avenues one has to
match one’s risk profiles with risk associated with the
Investment is to allocate money in the expectation product before investing.an understanding the basic
benefits in the future. Investment gives the benefit to the concepts deep analysis of avenues in investing which can
society as well as to the economic. Through investment we help the investors to build a good portfolio that minimizes
can grow your economic all over the world through modern the risk and maximizes the profits. There are some
capitalism. In earlier times investment only means saving in characteristics of Investments;
banks like FDs, jewelry and rare stones but today the people
are more of investments. But now a days people are aware  Return
about investing and their return but still they do not take All investments are made with the primary object of
high risk while investing their money in the capital market ( deriving return. Capital appreciation is the difference
investment avenues). As they are not able to select between sales prices and the purchase price. The expectation
appropriate investment avenues available in the market return from investment depends upon the nature of the
because of changing in the market and business trends day investment, maturity period and market demand so on.
by day. This research paper helps the new investors to invest
their money or fund in the appropriate way. By increasing  Risk
the saving habit in the peoples this can increase your Risk and expected return of an investment are related.
country economic wealth as well as economic growth all Higher the risk, Higher the return are expected. Higher
over the world. In a long term investment people can return depends on willingness of investors bearing the risk.

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Volume 5, Issue 6, June – 2020 International Journal of Innovative Science and Research Technology
ISSN No:-2456-2165
 Safety  Investments Objectives:
Safety of investment is identified with the certainty of  To analyze and study the various investment avenues
the return of capital without loss of time or money. Safety is which are available in the world.
another feature expected by the investors from the  To determine the objective of savings.
investments. Every investor expects that to get back the  To resolve the problems faced by investors.
initial capital on maturity without loss and without delay.  To analyze the investor's risk and return.
 To compare the investments.
 Liquidity  To know which investment avenue gives extra income
A well developed secondary market for security (Higher Return with low risk Bearing)
increases the liquidity of the investments. Any investments
that can be converted into cash without loss of value or time II. REVIEW OF LITERATURE
is said to be liquid. An investor tends to prefer maximization
return and minimization of the risk safety of funds and  Palanivelu K. Chandrakumar (2013) This analysis
liquidity of investments. separates the investment avenues into various parts such
as debt with a higher risk and rate of return. Debt which
 Equity has a fixed amount of rate of interest on investment,
Equity means shares denotes with small units of equal Fixed deposits are only with the bank , insurance, public
denomination constituting the share capital of the fund, with very less rate of return on investment, and
company.It is the most risky instrument in the market but safe. Data that analysis revealed 60% of responses like to
gives higher return. If a company is performing well and invest their amount in insurance , 20% of responses like
making profit year and year then the demand of share should to invest their money in banks in term or fixed deposits,
be high and then it will be growth in the market value of 30% of people invest in metals such as Gold, property
share.so shareholder has an option to sold the share in high and silver.
value and earn high capital gain.
 N. Panda J. K. Panda (2012) The study analyses the
 Mutual Funds: categories in the discrimination of investing people in the
Mutual Funds are basically investment routes that suggestion of investing their money based on their
comprise the capital of different investors who share mutual gender and age. There are various types of investment
financial goals. A fund manager manages the pool of money options that are analyzed in this research paper like
that is collected from various and invests the money into a Debentures, Life Insurance, Bonds, Debts, Pension,
variety of investment options such as company stocks, Property, Metal etc. investment suggestions are taken by
bonds, and shares. Investing in a mutual fund is the easiest the investing peoples only and the company has to wait
way through investors can increase his financial wealth. It is to see the result of it, while some investors are best in
regulated by Security Exchange Board of India. In Mutual investing their money with best investment avenues.
funds there are many schemes to invest as per requirements
of the investors In Mutual fund there expert who are  Srividhya S. Visalakshi (2013) The research paper
managing the fund of investors and help them to earn a analyzed that there are different types of schemes of
profit with their expertise. Mutual fund is highly flexible in investment avenues like fixed deposit,bonds,government
terms of financial objectives liquidity, and tenures. More deposits, real estate, post office deposit, Mediclaim’s,
liquid than other investment options i deposits shares, and equity, mutual fund etc. The analysis is done by the
bonds. Risk mitigation through investment done in a diverse private colleges and government colleges which says that
portfolio of securities. Consistent in performance over short maximum teachers of college save below 1 lakh. Most
, medium to long periods of time. Ans it relatively low cost of the Investors investing in Fixed Deposit for return
expenses and fees regardless of the fund performance also and not to take the risk.
 Fixed Deposits  Odoemene Met. al.(2013):-Investing in Investment
Fixed Deposit is investment instruments offered by avenues for the future returns. We get the results after
banks and non- banking financial companies, where you can analysis that the policy which have made for the
deposit money for a higher rate of interest than savings investors not properly study and analysis and any proper
accounts. One can deposit a lump sum of money in fixed saving schemes made for rural areas. Because improper
deposit for a specific period which varies for every study and analysis is difficult for the farmers and low
financier. It starts earning an interest based on the duration class category people to make the decisions for Savings
of the deposit. Fixed Deposit of the instrument in that and investments. The motive of Saving and Investments
money cannot be withdrawn before maturity, but not you is to take care of families or fulfil the requirements in
can withdraw after some loss of interest amount. Fixed future uncertainty.
Deposit is the Safest Instrument and offers greater stability.
Returns on fixed deposits are assured , and there is no risk of
loss principal .There is an effect on fluctuations on one's
fixed deposit, which ensures greater safety of investment
capital.

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Volume 5, Issue 6, June – 2020 International Journal of Innovative Science and Research Technology
ISSN No:-2456-2165
 Prasanna Kumar (2014) Investment means getting avenues available with the people in the market. In
benefits in later life. Investment categories are such as earlier times, there was no knowledge of investments
Equity, Government deposit, dealing in property, shares, and banking because investors have so much cash, gold
bonds, etc. The responses of the analysis tell us that the jeweler, and unique and rare (prestige) stones as savings.
various people select bank deposits investment. Now the people are investing in Mutual funds, pension
 Ravi Vyas (2012) The analysis says that the various funds, debts, equity schemes, medical policies etc
types of investing schemes are preferred by the investors. through banks and various clubs.
People think that Mutual Funds investment is secured
than any other investment with good rate of return in III. RESEARCH METHODOLOGY
future. Responses analyzed that most people invest their
money in metal such as Gold, Silver, etc. Mutual Funds The research methodology aims to find the perfect
investing people are very moderate in the country. For investment schemes for investors. In this procedure,
better security, safety, liquidity, risky, tax saving, and research is examined and appropriate ideas and identified
normal payback of Mutual funds have low scores among the knowledge which is the best appropriate topic to the
people. investment. At the time of Primary stage, the data collected
or analyzed by individual investors. Secondary data
 Gauri Prabhu N.M. Vechalekar(2013):- Mutual funds collected from various sources such as, journals, webs,
are the place where investors can invest their funds in the magazines, research papers, etc.
global capital market also. The huge amount of money is
collected in Mutual funds and then it is invested in  Problem Statement:
shares, debentures, bonds, and other securities which are The study under investigation here is related to
available in the capital market. This paper analyzes the analyzing the growth potential of Bank FD's, Mutual Funds,
knowledge and awareness about the mutual funds Equity (Stock Market). Investors are very much confused
between the peoples. The study states that between age about where to invest the money in the market. As we know
21 to age 40 are more active or interested in more the bank gives less amount but a fixed amount. The mutual
investments. Private sectors employees invest more fund also gives a 12% fixed amount, another amount
rather than the Government sectors employees. depending on the market. The stock market is depending on
the economy of the country. As investors are most conscious
 Priyanka Jain (2012):- The analysis states that there are of their money to invest in any of the markets.
various Investments avenues and schemes are available
in the market for Investments. It study that equity shares  Statistical Tools
are lower return, heavy capital, liquidity, risk, market, There are different types of statistical techniques that
tax allowances. Debentures are higher return than equity are used in the analysis of data. The following are some
shares with 10% risk and marketability. Bank deposits tools used for analysis the data. Data representation:-
give moderate rates of return and also normal capital
and risk, liquidity. ● Pie Charts
● Bar Graphs
 Gaurav Chhabra, Ankesh Mundra(2014):- The study ● Tables
indicates that there are various Investment options and ● Formulas

Sr. No. Investment Schemes No. of Responses Percentage (%)

1 Stock Market 40 18.33%

2 Bank Deposit 60 23.90%
3 Real Estate (Property) 10 8.10%
4 Mutual Funds 90 9.33%
5 Metal (Gold, Silver) 70 12.36%
6 Insurance Policies 50 12.30%
7 Commodity 2 0.22%
8 Tax- Saving Benefits 30 11.80%
9 Debt Market (Equity) 1 2.23%
10 Other 1 1.56%
Total 354 100%
Table 1

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Volume 5, Issue 6, June – 2020 International Journal of Innovative Science and Research Technology
ISSN No:-2456-2165
Scenario, the absolute return of your investment is 40% ,
But because the effect of annualized return is calculated on
compounding therefore the return should be 11.99 %.

Total Return :-
It referring that actual return which you will accruing
from the investment. It includes both capital gain and
dividend. For example, let’s assume you have investment Rs
1 lakh in Mutual Fund Schemes, and the Net Asset Value is
Rs.20. From when you purchase the investment of Rs.1
Lakh and the net asset value of Rs.20, It indicates that you
purchased 5000 units. After some years later, Net Asset
Value of Mutual Fund Scheme Investment Increased by
Fig 1:- Most Preferable Investment Option Rs.22 and the value of units will be increased by Rs.1.1
Lakh, that means (5000units x Rs.22 per unit) which
 Mutual Fund: indicates that you earn capital gain Rs 10,000 from your
Investments. Now in this Scenario dividend is declared by
Annualized Return – the company of Rs.2 per unit over the year, overall
If selecting, annualized returns policy then the measure Rs.10,000 dividend paid to Investors Rs. 10,000(5,000units
of an increasing the value of your investment fund on the x Rs. 2 per unit),Therefore your total earning shall be
basis of annual return, for example, you have invested Rs.2 Rs.10,000 + Rs.10,000=Rs.20,000(Dividend + Capital
lakhs in an Mutual Fund scheme. In a period of three years, Gains amount) which means you earning total 2 returns.
your investment has growth of Rs.2.8 Lakhs. In this

Types of Scheme Names 1 Year 3 Years 5 Years

Aditya Birla SL Equity Fund (G) 12.87% 15.58% 27.41%

Franklin India Prima Fund (G) 10.70% 12.65% 21.65%

Franklin India Smaller Cos Fund (G) 12.40% 18.65% 28.96%

HDFC Mid-Cap Opportunities Fund (G) 11.60% 15.89% 25.89%

ICICI Pru Value Discovery Fund (G) 9.85% 12.84% 22.90%

L&T India Value Fund – Reg (G) 10.25% 14.69% 26.39*%

Mirae Asset Emerging Blue-chip – Reg (G) 8.36% 13.45% 24.75%

Motilal Oswal Multicap 35 Fund – Reg (G) 14.10% 19.00% 27.28%

Principal Emerging Blue-chip Fund (G) 16.29% 18.36% NA

Sundaram Mid Cap Fund (G) 11.09% 16.01% 24.78%

Table 2:- Return from High-Risky Equity Funds

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Volume 5, Issue 6, June – 2020 International Journal of Innovative Science and Research Technology
ISSN No:-2456-2165

Types of Scheme Names 1 Year 3 Years 5 years

Aditya Birla SL Balanced ’95 Fund (G) 9.36% 12.48% 18.81%

ICICI Pru Equity & Debt Fund (G) 10.65% 13.27% 21.63%

HDFC Balanced Fund (G) 11.56% 14.19% 23.81%

L&T India Prudence Fund – Reg (G) 8.75% 14.00% 22.87%

Table 3:- Returns from Hybrid Equities-Oriented Funds – Moderate Risk
(Note Source: Different sites of Mutual Fund)

 Equity (Stock Market):  Bank

Equity Value is also called market capitalization, Banks are a financial institute licensed to receive
which is the total-sum values of the shareholders made deposits and provide loans. Banks might also give financial
available for the business and can be calculated by help and financial services such as wealth management
multiplying the market value per share by the total number planning, currency exchanges, and safe deposits. There are
of shares outstanding. It is the very main key for a business several different banking sectors such as retail banks,
owner especially when he makes a strategy to sell out his commercial and corporate banks, and saving banks. In
business as it gives a good calculation of what the seller of many countries all over the world, banks are regulated by
business would receive after the debt has been paid. the central bank and national governments.

 Increasing Equity value  Fixed Deposit:

 Paid In-Capital is increased. Shareholders are making Fixed deposit is one of the major investment avenues.
capital contributions, such as equipment, property and Most people prefer to invest money in FDs over equities as
cash to all small business firms which are incorporated. the former is safe. The amount returned from the bank FD is
 Decrease in the Liabilities. a fixed amount and known at the time of investing unlike in
 Increase in Net Income. case of equity. There are various Fixed Deposit schemes
 Increase in Outstanding Share. they are also called as term deposits. It is because money is
 Increases in Retained Earnings. deposited with a bank for a fixed predetermined time value
 Equity Value = Share Price x Number of Outstanding or term.
Shares.
 The share is the closing price of the stocks.
 The number of Outstanding shares should be the new
figure available.

For Example:-

Table 5

The FD Calculation Formula:

A=P(1+r/n)^n*t
Here,
● A is Maturity Amount
● P is Principal Amount
● r is Interest Rate
● t is Number of Years
Table 4 ● n is Compound Interest

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Volume 5, Issue 6, June – 2020 International Journal of Innovative Science and Research Technology
ISSN No:-2456-2165

For Example: To understand this better, let’s consider an A=100000*{[1+(0.08/4)]^(4*3)}

example. Suppose you are investing Rs. 1,00,000 in a Fixed A=100000*1.26824
Deposit for the period of 3 years at the rate of interest, 8%, A=126824
which is compounded annually value (n=4). As per the
formula provided, here’s the calculation you need to make:

Investment Options Very High High Moderate Low Very Low

Stock Market 70.55% 22.33% 0.2 3% -
Bank Deposit 1% 3.55% 25.00% 20.00% 60.00%
Real Estate 15% 18.33% 33.33% 33.00% 20%
Mutual Fund 6% 50.02% 62% 10.00% 9%
Metals 2.00% 40% 20% 20% 4.22%
Insurance 2.55% 18.00% 45% 25.00% 3.33%
Commodity Market 38.20% 20.00% 24.33% 10% -

Tax-Saving Schemes - 12.00% 55.33% 22.00% 12%

Debt Market 14.67% 10% 32% 20% 5.00%
Table 6
(Source: Primary Data)

Sr. No. Investment Percentage

Scheme Investment

1 Fixed Deposit 50%

2 Stock Market 20%
3 Mutual Fund 30%
Table 8

Fig 2:- Level of Risk is Involved in Investment Schemes

Particulars Debt Funds Fixed Deposit

Invested Amount 200000 200000

Interest Rate 7% 7%

Invested Period 3 Years 3 Years

Fund Worth 2,40,000 2,40,000

Inflation Flexible Rigid (Not

Flexible)

Tax Amount 19528 40000

Tax Paid Amount 3906 (Tax 12000

(highest tax bracket rate only Fig 3
30%) 20%)

Return Amount after 35094 26500

Tax
Table 7

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Volume 5, Issue 6, June – 2020 International Journal of Innovative Science and Research Technology
ISSN No:-2456-2165
IV. FINDINGS REFERENCES

1. The researcher has investigated 70 responses of India & [1]. Mrs. Pandey Meena; Investment Analysis and
it comes to know that 80% of people are knowing about Portfolio Management; Himalaya Publishing House
the investment schemes where the remaining 20% is Pvt. Ltd., Bombay; P.2016; pp 31-150
unknown. [2]. Miss.Singh Preeti; Investment Management:
2. The main reason for people is higher return in the future Security Analysis and Portfolio Management;
with a secured amount of invested money. Nineteenth Edition edition; Bombay: Himalaya
3. Most of the people invest more in FD so that they get a Publishing House; P.2012; pp 20-300
fixed amount of return at low return. [3]. The Journal of Portfolio Management Winter 2014
4. From table no. 7 We come to know that 50% of people [4]. C.R. Kothari, Research methodology: methods and
invest in FD, 30% of people invest in mutual funds and techniques, Vishwa Prakashan, New Delhi, 1999, pp.
only 20% of people invest in the stock market. 21-151
5. They invest less amount in the stock market because they [5]. Virani, V. 2012.Saving and Investment pattern of
think it is not giving proper return or any fixed return school teachers- A study With special reference to
amount as FD and a little bit of mutual fund and mutual Rajkot City, Gujrat. Abhinav National Refereed
fund give 12% of a fixed amount of invested amount. journal of research in Commerce and Management.
But they don’t know that the stock market gives more 2(4) :2277-1166.
than this investment. [6]. The Journal of Investing August 2020, joi.2020.1.8
6. From table no. 6 we come to know that if we invest 2 [7]. Shinde C.M. and Priyanka zanvar, “An Empirical
lakh rupees in a debt fund and fixed deposit at a rate of Study on Factors Influencing in Investment Decision
interest of 7% for 3 years after tax deducted we get a Making in Pune”, International Research Journal of
total amount in debt fund Rs. 35094 and in fixed deposit Management and Commerce”, Vol. 1, Issue. 6, 2014,
we get Rs.26500. So from this, we come to know that pp. 10-23
we get more amounts in return in debt funds than in [8]. Sanjay Sehgal, G.S. Sood, and Namitha Rajput,
fixed deposit amounts. “Investor Sentiment in India – A Survey”, Vision –The
7. From table no. 1 we came to know that people invest Journal of Business Perspective, Vol.13, No.2, April-
90% in mutual funds and the 2nd invested option is most June 2015, pp.13-20.
preferable by people is 70% in metal and the 3rd [9]. www.Google.com
invested option is bank deposit i.e. 60%. [10]. www.onlinesebi.com
[11]. www.policybazar.com
V. CONCLUSION [12]. www.moneycontrol.com

After the study of various investment avenues through

the investigation, it comes to know that the people who are
Investing their money are well known about investing
avenues that are present in the current market in India but
still, people are more preferred with bank deposits than
other investments. The study of investors tells that the safety
and high return of money as a vital factor while saving their
money in any investment, so other options of investing
amount is less found less preferable in investment by
people. People refer mostly to normal interest amounts
rather than heavy risk that they can get more amount in
return. From the analysis people started investing amounts
in the stock market to earn more profit by taking high risk.
Also they can balance their risk with investing in secured
investment avenues such as bonds, debentures and FD.

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