Introduction To Various Asset Classes Equity, Debt, Gold

Editor's Notes

• #2: INTRODUCTION As you may be aware, life expectancy of individuals has increased; which brings with it rise in medical and living costs during old age. Therefore, it is imperative to make provision for expenses wisely. All of us want to maintain our standard of living during our old age as well, but to do so we need to actually start thinking and planning for our retirement right from the beginning of our career when we are young. This session aims to help you understand how you can identify and establish your financial goals.
• #3: Meaning: (…As we mentioned even in our session 1, investing is…) An act of laying out the ‘money saved’ for productive use with an expectation of earning return higher than inflation to preserve purchasing power of money A process of making your ‘money saved’ work for you (instead of simply stacking in your vault / bank locker or even in your cupboard) (In simple terms, by investing you purchase an asset with your money with an expectation of generating income or profit)
• #4: (Assets are broadly classified as…) Physical Assets and Financial Assets A Physical Asset is an asset which has value and can be touched, felt and used (…an investor buying land, a house, a painting or gold can touch and feel them. Such assets are in the control of the buyer and can be put to use as per the choice of the buyer. But physical assets also carry a storage or maintenance cost) Financial Asset (on the other hand…) is an asset which is bought in the form of certificate, which entails the buyer for the benefits as a beneficial holder. But such entitlement cannot be touched or felt (…equity shares, bonds, debentures, fixed deposits, provident funds, mutual funds etc are some of the financial asset that investors normally invest in. The benefits derived from these assets depends on the performance of the underlying company or issuer)   [Historically in India, people have been more comfortable with physical assets, which have drawn a large portion of their wealth. As physical assets held by an investor do not benefit the economy, they are termed as unproductive assets. In order to help the economy grow and in turn benefit from the growth of the economy, people need to emphasise a portion of their investments towards financial assets]
• #5: Equities or Stocks (…a most commonly thought of as a high risk – high return investment avenue) Debt or Bonds (…people often construe debt markets to be safe, but it does carry risk, which we will tell you as we progress with the session) Fixed Deposits (…one of the most popular investment avenue in India, which is considered to offer decent and fixed return. Here the risk is relatively less) Precious Metals (…In India, precious metals like gold and silver have sentimental value attached to them. We usually buy them on auspicious occasions and consider them as security for unforeseen events) Commodities (…As inflation keeps growing at an healthy pace, the prices of goods and services keep on increasing. In order to reap the benefit of increasing prices of goods, people now a days consider some exposure to commodities as well) Real Estate (…The house you live in is meant to fulfil your basic need for shelter. Although it may appreciate over time, it shouldn't be purchased with an expectation of profit, because after all, the house you live in is a primary home for your own dwelling. In anticipation to make profits, some people buy multiple house, apartments, land etc to rent out or resell at a higher value in future, which form the part of their investments.) Art (…Some people consider valuable Art objects like panting’s etc as a status symbol and some buy them with the intention of reselling them for a profit. Those who understand it, tend to spend huge money on art and consider them as an investment.) [While commodities and art may be classified as an investment avenue for informed investors. Such investments carry a risk of physical depreciation /damage or perishable loss and also require storage costs that may cut into ensuing profits. On the other hand real estate investment carries complex and time consuming procedures. This in a way makes them unfriendly for new investors. So in this session, we will emphasise on relatively simple investment asset class like Equity, Debt and Gold]
• #6: Equity means Ownership (…In simple terms, equity means ownership, everyone who holds equity in a company is a beneficial owner of the company) Equity holders are the owners of the company (…equity entitles you to become one of the several owners who are called the shareholders of the company and can participate in company’s growth) Companies issue equity to raise capital (…which may be used to develop the business or repay existing debt etc)
• #7: Advantages of Equity Investing As an equity investor, you enjoy ownership in the company (…equity shares reflects partial ownership in the business of the company. As an equity shareholder you enjoy the rights of the owner, based on the level of stake you hold in the company. You also get opportunity to vote for important business decision) Earnings in the form of profit sharing through dividends (…after disbursing the preferred payments, profit making reputed companies share a part of their profit with the equity investors in the form of dividend) Returns in the form of capital appreciation (…Over the longer term, shares are likely to produce capital gains through increases in share prices. As the shares of listed companies are traded on the exchange, the net worth of equity investors is influenced by the share price movement in the markets. If there is an appreciation in the share price, your opportunity of making gains from your equity investments increases) Ability to generate returns that are higher than inflation (…yes equity markets are exciting, dynamic and of course have the potential to provide high returns over the long term. Historically equities as an asset class, has outperformed other types of investments over long periods of time. Equities have proved their ability to generate returns higher than the rate of inflation in the long run. And hence they are generally considered as a crucial instrument while planning one’s long term investment strategy) Limited liability (…As equity has limited liability feature attached to it, as one of the many owners, you are personally not liable in case the company fails to meet its obligations. This means despite gaining from the benefits, you are personally not supposed to bear the losses. At the most what you can lose is the value of your investment) Tax Benefits (…as per the current taxation laws, Equity investments carry favourable tax status. The dividend income is completely tax-free in the hands of shareholders. Even long-term capital gains you make by holding your equity investments for a period of more than 12 months are not taxable. Besides, short term capital gains are taxable @ 15% + applicable cess and surcharge) Liquidity (…One feature listed equities offer is liquidity as compared to other investments like real estate where it may take time to liquidate your investments. You can sell your equity investments and get your money in 3 to 4 business days.) Equity investing helps in economic development of the country (…Equities play an important role in economic development as well. As an equity investor, you invest in the business of the company. The company can use this money in financing important projects, which creates employment. More employment leads to more consumption of goods and services offered by other companies, thus supporting projects of companies offering these goods and services. It also boosts the revenue collection of the government in the form of direct and indirect taxes, which if spent prudently leads to economic development) Equity markets have a well regulated structure (…equity markets are well regulated by the regulator, thus protecting the interest of the investors. In India equity markets are regulated by SEBI (Securities and Exchange Board of India), who monitors and keeps control on any wrong doing that may hamper the investors)
• #8: (But along with the advantages, there are some disadvantages to equity investing…) Disadvantages of Equity Investing Equity does not guarantee return (…equities do not guarantee any return to the investors. The return on one’s equity investment depends on the performance of the company. A well-managed company can do well and deliver for its investors, while a bad management can lead to failure and loss of capital to investors) Equity investments carry high risk (…equities are generally known as High Risk-High Return instruments. As the price of shares of a company can swiftly rise or fall, based on the news flows or sentiments prevailing in the equity markets. The investor is tied by the risk of capital depreciation if the market prices of stock move lower than his actual purchase price. However actual risk is accounted when the investor happens to book loss by selling the stock at lower price.) Need proper skills to identify a good equity stock (…it is not easy to identify a good equity or a stock for one’s portfolio. Identifying the right stock require skills and ability to understand stocks on various parameters. You need to be more cautious. Proper analysis across qualitative and quantitative parameters and comparison with peers is a must while zeroing on a good stock) Needs regular monitoring (…one needs to regularly monitor equity investments and keep track of qualified news related to the company you have invested in. Such news has huge influence on the share price which decides the health of your investment portfolio.) News flows impact equity markets (…human beings have tendency to get carried away with attractive money multiplying tips on stocks that they receive from friends or some stock brokers who put their interest first. But we think that you ought to be careful and not fell prey to such misleading tips or news. As we said, you need to be cautious and do proper analysis before investing in equities)
• #9: Equity Investing is Suitable for Investors with a certain level of risk taking ability (…equities being volatile by nature, carry risk to capital in the near term and hence may not be suitable for investors looking for safety of capital. Investors investing in equity should have the appetite for higher risk. You should do your risk profiling to gauge your risk appetite well before considering equity for your investment portfolio.) Investors eyeing for high returns (…historically equities has been the asset class that has delivered better inflation adjusted returns for its investors in the long run. The quest for high returns attracts investors towards the equity markets. Though equities are known to be high return generating asset, they should not be considered as an instrument to double your money within 24 hours. Equity investing is not for gamblers.) Investors having a long term investment horizon (…equity investment requires patience. If you start planning for your retirement at an early age, equity could potentially be an asset class you could consider. The earlier you plan the better it is, and equity can play a crucial role in getting close to achieving your long term financial goals) Investors ready to invest small but regularly (…if you have a regular income and manage to save a portion of your income after providing for your contingencies and necessary expenses, you should not leave your money ideal in your bank savings account. You can plan regular investment based on your risk appetite and time horizon. Opting for a “Systematic Investment Plan”, popularly referred to as SIPs, in an equity mutual fund is a good option for investors who want to follow disciplined investment approach. Such investments can help in gradually contributing towards long term wealth creation)
• #10: How to Invest in Equities [Broadly you can invest in equities in two ways – Directly or indirectly, let’s see how] Direct Investment (People who wish to gain exposure from equity markets and have some expertise in choosing individual shares and can devote time for monitoring their portfolio, can buy equities directly. They can do so via…) Stock Exchanges through a Stock Broker (…as equities trade on the exchange in the secondary markets, you can buy a stock directly from the exchange. You can approach your stock broker, who may buy on your behalf and get the stocks credited in your demat account) Initial Public Offerings (IPO) (…when companies approach markets to raise capital they do it through a ”Public Issue”. The first time issue of shares by the company is termed as an “Initial Public Offering” more commonly known as an IPO. For this you can fill in the respective application form and wait for the allotment. The number of shares allotted to you will get credited to your Demat account. Indirect Investment (People who lack expertise of choosing individual shares and find it hard to devote time for monitoring their portfolio, can take the services of investment managers. Investment managers help investors indirectly hold exposure to equity markets. They can do this via…) Mutual Funds (…equity schemes offered by mutual Funds help investors take the benefit of equity investing. Mutual funds are cost efficient instruments that carry the expertise of professional investing and managing money on behalf of investors. As mutual funds works on the concept of pooling in money, there are multiple investors, who jointly benefit from gains and losses. You can invest in mutual funds with as low as Rs 5,000/- lumpsum and Rs.500 as SIP though the same may vary from fund house to fund house) Portfolio Management Services (PMS) (…Portfolio Management Services are offered to investors, under which the portfolio manager buys or sells stocks and creates a portfolio for the investors. The Portfolio manager charges a fee for this service. PMS services are regulated by SEBI and portfolio managers are required to comply with the regulations framed thereto. PMS are usually more expensive than mutual funds the minimum ticket size for investing through PMS is Rs.25 lacs..)   (Well, equity markets are a good choice for earning higher returns over the long run but do remember that high returns do entail high risks too. It means you need to put your invested capital at some risk and you cannot always expect preservation of capital. And so to reduce the risk or to preserve your capital, you need an asset class which performs the function of preserving or protecting your capital from eroding or turning negative. It is not something new we are talking about, instead this is a traditional asset class which existed even much before equities became popular and exciting as an asset class. Yes this brings us to our next asset class in today’s session - Debt)
• #11: Debt means Loans (…In simple terms debt means loans. It is the money a lender lends to the borrower. In other words we can say that debt is an obligation or a commitment from the borrower to repay the money borrowed from the lender) Debt Investors lend money to issuers at a pre-decided coupon (…In debt markets, the investors invest their money in the form of loan to the issuers, who are usually banks, company or government at a pre-decided coupon rate.) On maturity the issuer returns the principal to the investor (…when the bond matures on the due date, which usually ranges anywhere between 1 to 30 years, the issuer gives the original investment or the principal amount back to the investor)
• #12: Once you have set your financial goals over various time frames, you need to periodically evaluate your progress towards achieving your goals. There can be conditions that may cause change in your financial goals) Conditions that may cause change in your financial goals Marriage (if you happen to set your financial goals before marriage; you may have to revisit them after your marriage. There might be a few important goals which you may have not considered before) Divorce (An event like divorce can lead to a bigger change in one’s life, personally as well as financially) Birth of one or more children (If you have a new born child, congrats! But you may also have to now include some financial goals and provide for expenses related to your new born child) Death of a spouse (God forbid, but death of a spouse can hinder one’s financial goals) Disability or illness (of self / parents / children / spouse can lead to a significant change in a financial commitment) Loss of employment (of self or spouse can impact your source of income and hence demand a change in your financial goals) Change in job (moving from one job to another may have an impact on your financial commitment and lifestyle as well) Change in location (moving from one location to another can also lead to a change in your lifestyle) (With change in circumstances and needs, you will have to revisit the earlier goals and finalise them again. We are hopeful that this session has given you an insight in identifying and prioritising your financial goals. Remember, it is you who would best understand your needs and decide your financial commitments)
• #13: Low inflation adjusted returns (…historically debt markets have been less rewarding as compared to equity markets. As debt instruments are considered to be a “low risk low return” investments, people prefer debt more for safety rather than capital appreciation. While on one hand you can expect getting assured returns, on the other hand these returns would be low) Issue with price discovery (…as the retail debt market in India is not well developed, retail investors find it difficult to track the prevailing price of their debt holdings. For returns from their bond holdings, retail investors rely more on regular coupon payment, rather than looking for the prevailing market price of their holdings. Thanks to debt mutual funds, which help retail investors participate indirectly in bond markets, without worrying about prevailing market prices.) Interest rate risk (…as bond prices and interest rates are inversely related, bond prices fall when interest rates rise and vice versa. Debt markets quickly react to any policy action taken by the central bank (RBI). The expectations of interest rates lead to change in sentiments and impacts the market linked debt portfolio of investors. So while debt markets may be construed safe in terms of assured flow of income, they are not safe in terms of prevailing market price. To make your debt holdings safe, you need to hold them till maturity, but you may forego any opportunity of making intermediate capital gains. If you invest in debt markets considering it to be absolutely safe, do not forget that it may even surprise you in unfavourable conditions) Credit risk (…issuers in debt market have their credit worthiness, which is measured by the rating agencies. Before investing in any debt market instrument, you should check the credit rating assigned to the issuer. You should not fall for the high returns on offer. Issuers with low credit rating need to offer high interest rates to attract investors while issuers with high credit rating would offer low interest rate to the investors. Low credit rating means more chance of default, while high credit rating means less chance of default)
• #14: Conservative Investors (…As debt markets are construed to be less volatile then equity markets, they are preferred by conservative investors looking for safety to capital. In fact your safety to capital depends on the kind of instrument you hold exposure to, your holding period, maturity profile etc.; you should select your debt investment based on your investment time horizon. Say if your time horizon is less than 3 months, you should not hold a longer maturity instrument, as it may be highly volatile in the near term) Investors looking for regular flow of income (Debt market helps in generating regular income as they offer exposure to income-generating instruments like Government Securities, Bonds, Non convertible Debentures, fixed deposits etc. As credible debt market instruments pay regular interests while keeping your principal intact, debt markets are ideal for investors looking for regular flow of income) Investors whose goal is approaching (when you have your goal approaching, preservation of capital becomes your priority. You would prefer to keep your money safe, so that you do not fall short of money to meet your commitment. Unlike equity markets which may be highly volatile in the short term, debt markets provide you with investment avenues to park your money even for a short span of time. Short term debt instruments or even liquid mutual funds are ideal category to park your very short term money, while keeping your principal relatively safe)
• #15: Avenues to Invest in Debt Markets [Here are some common choices for you to invest debt markets]   Bank Fixed Deposits (…Bank Fixed Deposits are most common debt market instrument in India. Bank FDs have been very common amongst investors as a traditional investment avenue for decades. As we said earlier your investment in bank fixed deposits is a kind of debt which offers you fixed interest rate along with some safety to capital. Fixed deposits upto Rs 1 lakh are covered under DICGC (Deposit Insurance and Credit Guarantee Corporation). The tenure of bank fixed deposits ranges from 7 days to 10 years. Corporate Deposits (Corporate deposits are nothing but fixed deposits offered by a company or an institution other than a bank. Over here, the interest rates vary depending upon the credit quality of the issuer. Independent rating agencies assess the credit quality of the company and assign the rating indicative of the risk involved in the investment. Thus, higher the credit rating lower is the interest rate offered and vice versa. However, sometimes companies raise money without securing a credit rating from independent rating agencies. In such cases companies often pay higher interest to attract investors) Corporate Bonds and Debentures (Corporate Bonds are issued by Public Sector Undertakings (PSUs) and private corporations as well, for a wide range of tenor normally, say for a period of 1 year to 15 years or even more. Don’t forget corporate bonds may turn out to be risky. This riskiness depends on the issuing company’s credit rating, the business into which the company is in, the sector in which the company operates and the prevailing market conditions. You need to consider the credit rating of a bond before zeroing on a bond or a debenture for your investment.) Government Securities (G-Secs or Government of India dated Securities are units / debt papers is issued by the Government of India in lieu of their borrowings from the market. Government of India issues a certificate through the RBI acknowledging receipt of money in the form of debt, bearing an interest rate. Government Securities includes all Bonds, T-bills and instruments issued by the Central Government and State Government. These securities are normally referred to, as ‘gilt-edged’ as repayments of principal as well as interest are totally secured by sovereign guarantee) Small Saving Schemes offered by Government and Post Offices (…The Government of India has framed various savings scheme to provide secured and attractive investment opportunity to the public, and use this as a resource for the development of the country. Even today the “Post office” is one of the largest savings institution in the country and plays a vital role when it comes to savings. It offers various saving instruments to the public, which even provides numerous benefits to the investors. Some of the major instruments of post office schemes also offer tax exemption benefits to the investors.) Public Provident Funds (…many of you might be aware of the term PPF. Public Provident Fund or PPF is used as a savings-cum-tax-saving instrument in India, as it used as a tool to save for one’s retirement, especially for those who do not have any structured pension plan covering them. As per the current laws, you can invest a maximum of Rs 100,000 per year. PPF offers you a fixed interest rate every year, which helps your money grow on compounded basis each year. Many nationalised banks and now even some private sector banks are authorised to open PPF account for Individuals who are residents of India) Debt Mutual Funds (…Today there is a plethora of investment options available under the category, which makes it difficult for you to choose from among multiple bank deposits, hundreds of corporate deposits, thousands of small saving schemes etc. As it is nearly impossible to invest money in multiple debt instruments, Debt mutual funds provide you the advantage of taking exposure to multiple fixed income instruments through a single investment product. Their primary objective is capital preservation and income generation. Your time horizon as well as your liquidity preference is of utmost importance while selecting the right debt mutual fund for you, as portfolio structure and maturity structures differ for various categories offered by debt mutual funds)   (Now that you may have obtained a better picture of investing in debt, let us take our next and popular asset class in today’s session- Gold)
• #16: [Gold is an asset class, which needs no introduction. We come across and even use this precious metal in our day to day life in some or the other form. But do you know why gold is a critical asset class when it comes to investing. We will tell you why] Gold is a Precious Metal (…In true sense, gold is a precious metal, why?) It carries “store of value” (…well, gold carries store of value. In contrast to other major asset class such as equities - which derive their value from the underlying businesses, or real estate - which could provide rental yields for you along with a potential for capital appreciation, or debt - which pays regular interest; gold possess no such distinctive characteristic(s). But having said that, let us apprise you that it is considered to be a store of value, as it enables you to combat the rising cost of living over the long-term and therefore also acts as a hedge against inflation. Historically gold has been a valuable and highly sought-after precious metal for making coins, jewellery and ornaments and is so precious that we even store gold in our vaults and lockers in the form of bullion, coins and bars.) Gold is a vehicle to monetary exchange (…globally gold is widely used as a vehicle to monetary exchange and the money flowing in the global monetary system is in some way or the other attached to gold)
• #17: (…different people may have different reasons for buying gold. And here are a few reasons why people like to buy gold and some even put them to use) Store of Value: (…as we just said, Gold is a long-lasting metal, which can last for ages. It being a precious metal has been used for exchange and has lasted as money for centuries) Reserve Currency: (…Having store of value, the central banks and government of various nations aim to maintain gold reserves in order to secure their position. The central banks use these reserves as a guarantee to cash in their promises and pay their depositors and note holders) Hedge against economic pressures: (…Gold being a precious metal is also used as hedge against financial distress like inflation, deflation and currency devaluation. Due to frequent changes in the supply of money in the system, the value of currency can inflate or deflate. Hence holding gold can help one hedge such risk of devaluation of money which might be lying in their bank accounts and lockers) Industrial demand: (…Though not as high as silver, gold has some industrial and medical demand too) Jewellery / Ornaments: (…India is one of the largest consumers of gold. People in India have special fascination and emotion for gold. They buy gold especially in the form of jewellery on auspicious occasion like marriage, festivals and social events. Many Indians, like to pass on their gold to the next generation in the form of jewellery and ornaments) Investment: (…Purchase of gold jewellery may not always be termed as investment, as people hardly sell their physical gold jewellery to book profits when prices go up. Conventionally for investment purpose, people prefer to buy gold bar and coins in physical form) Portfolio Diversification: (…Gold is termed as a hedge against inflation as it has ability to take care of loss in purchasing power of money. In conditions where productive asset classes like equity, debt and real estate face the risk of losing value, due to fall in currency value, gold can come to rescue. Also if these productive asset classes are unable to adequately compensate individuals with inflation adjusted returns, then demand for precious metals like gold tends to increase. Hence it is recommended to hold a small portion of gold in one’s investment portfolio, thereby diversifying risk across asset classes) Pledging for Emergency Needs: (…Many banks and gold financing companies have started offering secured loans to individuals, who wish to pledge their gold at a reasonable interest rate, for a pre-specified tenure. The interest on such loans is lower as compared to personal loans. So, gold can be used for raising short-term finance for a nominal rate. Individuals with gold lying ideal in their locker can pledge their gold to meet their short term financial needs. Thus it is not necessary to sell your gold to raise money in case of emergency)
• #18: Conventional ways to invest in Gold Physical form - Jewellery or Coins or Bars (…many investors prefer to invest in gold the conventional way. Yes you got it right – by purchasing gold in a physical form i.e. in the form of gold jewellery or coins or bars – As buying into the precious yellow metal is driven by emotions, many often prefer to invest in gold the conventional way, as they can touch, feel and see their gold holdings. While you can buy gold in the form of Jewellery, coins or even bars from your jeweller; you can also buy gold coins and bars even from your bank) (But buying gold in physical form may have its disadvantage like high storage cost, quality issue, purchase at a premium price, resale at a price lower than the market price leading to low resale value etc. So to avoid these issues investors are gradually shifting towards unconventional ways to invest in gold) Unconventional ways to invest in Gold (The unconventional way of buying gold facilitates you to invest in gold in a non-physical form i.e., either through paper form or even in non-paper form (which is electronic form), but they offer the advantages of investing in gold. Such investment options are:) Gold Exchange Traded Funds (Gold ETFs) (…ETFs are instruments, offered by mutual fund houses and are listed on a stock exchange. They represent ownership in an underlying security, commodity or asset. Hence, to put it simply, a Gold ETF is an instrument that represents an ownership of gold assets. When you buy a Gold ETF, you are allotted units indicating your ownership in gold equivalent to the rupee amount of your investment. Gold ETFs are listed and traded on a stock exchange and you can buy or sell them on a real-time basis. But to own them, you need to open a demat account along with a share trading account with a broker.)   -Gold Funds (…Gold funds are a relatively new breed of unconventional way to invest in gold. Gold funds invest their corpus into companies that are in the business of gold. These are generally gold mining companies. Gold funds attempt to provide returns that closely correspond to the returns of gold as an asset class. Unlike Gold ETFs (where you hold units in your demat account); in gold funds you have an option to hold units in physical form as well. Moreover, gold funds apart from lump sum investing, offer the Systematic Investment Plan (SIP) mode, which is effective and convenient way of investing regularly in gold) (Holding gold in an unconventional form like Gold ETF’s or units of a gold fund offers advantages like convenience, low storage cost, , fair purchase and resale value, favourable tax implications amongst host of others)
• #19: Some Key Take Away Points Equity Equity means ownership (…equity entitles you with partial ownership in a company. And you can participate in company’s growth) Equities help you earn through dividend as well as capital appreciation Equities have the potential to generate returns higher than inflation (do not forget, for equities to generate returns higher than inflation, one needs to stay invested for the long term) Equity does not guarantee return (…equities do not guarantee any return to the investors. The return on one’s equity investment depends on the performance of the company.) Equity investments carry risk (…while investing in equities, you may be tied by the risk of capital erosion.) You can invest in equities in the direct form or through the indirect form (…which we discussed earlier)
• #20: Debt Debt offers preservation of capital (…being less volatile vis-à-vis equity, if invested prudently, debt can provide a level of safety to your capital) Debt is ideal for generating regular flow of income (…debt offers pre-specified coupon payments which helps investors with regular flow of income) Debt offers low inflation adjusted returns (…you may find debt markets boring as it offers low returns, but do not forget that they may offer preservation of capital too) There are some risk associated in debt markets (…you cannot avoid interest rate risk and credit risk while investing in debt) Bond Prices and Interest Rates are inversely related (…When interest rate moves up, bond prices move down and vice versa) Select your debt investment wisely (…while investing in debt, you should consider your investment time horizon, and identify the debt instrument wisely)
• #21: Gold Gold is a precious metal and has a “store of value” Gold is a good hedge against inflation ( and it can come to your rescue during crisis) You can hold gold in physical as well as non-physical form (you can choose to either buy gold bars and coins or hold it in your Demat account in the form of mutual fund units.
• #22: So to end our learning exercise today