Tue Oct 13 2020 by Bhuvan Rustagi
We are now living in tough, uncertain times in which the world is grappling with the effects of the pandemic that started earlier this year, and still does not have a definite end in sight. Many have lost their jobs or have taken a pay cut, and naturally the investing and spending behaviour has changed drastically.
A recent survey conducted to evaluate the impact of COVID-19 pandemic on Indian investors, showed that 36% of the respondents had lost between 30-40% of the value of their investments. 100% of these respondents also reported losses in varying sums.
The COVID crisis has reduced the risk appetite of most people in India, and they are now looking for alternate low-risk, safer investment options, wherein the returns are higher than investing in Fixed Deposits. During times of economic slowdown like this, it becomes vital for investors to rebalance their portfolios periodically and diversify their investment as much as possible.
It also is the ideal time to get a hold on one's assets, finances, and liabilities, and to begin saving more money. Among other things, the Covid-19 pandemic has underlined the importance of having a robust financial plan as a cushion to fall back upon in case a similar situation arises again. To be adequately prepared, investors must now look beyond the conventional investment options onto contemporary and innovative products that show promise; peer-to-peer lending being one of them.
Peer-to-peer lending is quite the simple and systematic process of lending and borrowing money. It offers superior returns to the investors when compared to several other options, making it a great investment prospect in these economically turbulent times.
Peer-to-peer lending platforms offer investors with a great opportunity to boost their portfolios and enjoy an above-inflation rate of return. Moreover, one of the best ways for investors to minimize risk is to diversify or spread their money across a distinguished investment pool. People having an expansive and diverse investment portfolio are least to be affected by economic turbulence.
Lendbox is India’s leading Peer-to-Peer lending platform, where both investors and borrowers interact and transact online.
Lendbox alternately offers several investment modules ranging from zero-risk, low-risk, and medium-risk investments. The zero-risk and low-risk investment options give sound returns and can be liquidated within a months’ notice. We are an RBI registered NBFC-P2P company and have partnered with some of the leading technology platforms to fulfill short, medium, and long-term investment goals.
All users registered are thoroughly verified before they can begin the transactions on the platform as a security measure. One can start investing with a capital of just ₹10,000 and earn returns up to 16%p.a. Lendbox enables people to borrow and invest safely, thus striving to be a reliable business and investment partner.
A Long-term, high value investment. Buying a house is typically seen as an accomplishment and is one of the top priorities of Indian families. India’s real estate institutional investment came down around 58% in the January-March period of 2020 due to COVID-19.
In fact, the real estate industry of the whole Asia-Pacific region took a huge hit, with volumes down 45% from the year-earlier period. However, the recent fall witnessed in the home loan rates in India is expected to provide a good boost to this investment category. The fall in the interest rates have largely been due to the diverse measures announced by RBI, including the repo and reverse repo rate, and the infusion of liquidity in the banking system.
Zero risk with guaranteed and stable returns. This is a popular investment option in India despite its very low returns. Moreover, as the contemporary financial market grapples with the severe impact of lockdowns and economic slowdowns, fixed deposit holders can look forward to ensuring assured returns, as this investment tool offers interest at a fixed rate.
Investing here requires a good knowledge of the market and industries. It is a very high-risk option and one must be constantly up-to-date with market conditions. Private equity and venture capital investments in India may decline up to 60 % in 2020 due to the COVID-19 pandemic, as per a report by EY Consulting. Many investors are worried that because of the uncertainty many are unaware on how long will the current stock market situation shall last.
However, with the interest rate reductions and the uncertainties prevailing in the sector of real estate, stock markets are gradually becoming a lucrative avenue for capital inflows. It is recommended that investors maintain adequate liquidity of at least 25% at individual portfolio levels and invest in stocks in a diversified, staggered, and systematic manner.
For decades, gold has been among the most popular investment instruments among in India. According to the World Gold Council (WGC), the uncertain market scenario in this pandemic, as well as the positive price momentum of gold, might lead to positive trends for this investment option in the future.
This precious metal had quite a commendable performance in the first half of 2020, and increased by 16.8% in terms of US dollars, and considerably outperformed many other major asset classes. As the effectiveness of gold as a hedge can aid in mitigating the risks associated with equity volatility, investors have started considering gold as a good option for part of their bond exposure.
When one thinks of mutual funds, they also think of market conditions, thanks to the countless times we hear the disclaimer on the risk of investing in mutual funds. Investing in pharma sector mutual funds can especially prove to be advantageous amidst the pandemic, as governments are likely to increase spending on healthcare. While like all other investment options, mutual funds have also taken quite a hit, Nifty and Sensex Index-based mutual funds are expected to bounce back stronger once the economic recovery starts.