3 things to Look For in A Financial Investment

When one looks for an investment option, one has a few things in mind. The choices people go for when thinking of investments depends mostly on personal nature, like

• risk averseness,
• family background,
• nature of individual , etc.

However, leaving these aside, there are some things investors need to know when they start to invest

Safety 

How safe is the investment? Is it with any acclaimed group with previous history of assured returns? Is it in a Bank FD (most safe), is it with a Mutual Funds (relatively safe if one understands the risk factors). There are many fly by night operators offering schemes with hiuge returns. Be aware of those while investing. If a scheme seems too good to be true, it probably is based on falsehoods. it is always better to be safe than sorry while going for investments

Liquidity

Liquidity is ease with which you access your money. You need your investment to answer these questions. How soon can you access the money in case you need it. Bank accounts are the most easily accessed. FDs money gets transferred the same day if it is withing the banking hours. Similarly stock markets are very liquid. Your funds come in a day or two once you sell a stock. Mutual Funds too transfer your money in T+ 3 when you redeem (sell) your units. However if you have invested in a house, it may not be that easy to sell off to access your investment!

Diversity

Diversity is very important for any kind of investment. Dont put your eggs in one basket is a maxim that should be adhered to always in investments. Last month's debacle in the Debt markets proves a point. While these are uncertain times and anything can happen, its prudent to mix up you investments, mutual funds, stocks and bonds, FDs, gold bonds, real estate, rentals together in some combination are the acceptable methods of investments.

When you start investing be sure to ensure the above to have a healthy investment portfolio