4. Child insurance

Children’s insurance plans in India are regular life insurance policies that are designed in such a way that they meet the needs of your children financially when the need arises. These are sold heavily in India, are instruments that take advantage of equity investment and hence carry risk with them which gets evened out if you stick with them for a longer duration.

Child ULIP plans have high entry charges associated with them so the amount of your money invested is less in the initial years than in the later. Child insurance is Endowment Insurance in Disguise. Don’t get carried away by the word child.

5. Penny Stocks

Investors think that only Penny stocks and Small Caps have potential to return multi Bagger returns. Most companies offering penny stocks have little if anything in the way of profits, not to mention the first prerequisite for profits: sales. They end up investing into junk stocks with no fundamental values.

Penny Stocks may give you multi bagger returns. They are thinly traded and easily manipulated. You may buy a penny stock and see it zip higher, but then have trouble getting out.