Saturday 6 August 2011

Investment Guide - for "Fresh off The Boat" Investors

Alright...the world economy no doubt is going through a bad patch; in fact a really "dismal" phase of cluelessness, commotion and intonation. With the news of US Debt Crisis, and it's projection as the one event that could show the world what intense recession meant or the ongoing Domino EU Debt Crisis that is just not ready to cease; the world market is just not ready to stabilize.

Unstable share prices, unstable sensex, unstable foreign exchange rates et al; the modern day investor is just not ready to decide what to expect out of the market or how to choose an investment portfolio that would minimize his/her risks and guarantee an equally healthy return on investment.
The coeval investor is just not ready to see his/her hard earned money lose its value. Let's see what investment options we have in the current day scenario :

  • Share market ( way too risky)
  • Govt. Bonds ( a safe bet, but not so lavish returns)
  • Debentures ( naah..I don't think they are in a state of safe level)
  • Mutual Funds ( alright...not an unsafe bet..you have your set of marketing gurus to invest your money)
  • WHAT ABOUT GOLD ??!! Strange is it..or is it the safest investment commodity ?
Well, let's see what GOLD can actually do to your investment ! Let's analyse the graph ! (goldprice.org)
What does the increasing graph connote ? Perhaps gold price in 1990's was much less than what it is today, signifying a clear increase in the price exponentially.  A comparison shows that if the price of gold (USD/oz) in 1990 was around $490, it today is close to $1700; a whopping 257% increase in the price. One more thing worth noticing in the graph is it's close to stable increase, without any drops or lows.
The interpretation : 
A person who invested INR 1000 in gold in 1990, would have got close to INR 3570 in 2011; and the return on investment just doesn't stop rising; making INVESTMENT IN GOLD one of the safest investment options in today's 'not so stable' economic scenario.

Invest a currency note in gold; and the market will ensure that you get a bigger currency note in the future in return !!

THE REASON FOR THE EVER RISING PRICE OF GOLD WOULD BE DEALT WITH IN MY NEXT POST !

P.S : All my posts are my personal interpretation of the current economic scenario. Any discrepancy if noted can be intimated without hesitation.

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