3 Reasons to Invest In an FD in This Fluctuating Market

3 Reasons to Invest In an FD in This Fluctuating Market

As we ready ourselves for the Lok Sabha election results on 23 May 2019, the atmosphere is charged with speculation, courtesy of the exit polls. The results suggest a re-election of the current government, and while this may or may not be the outcome you’d hoped for, it does have a bearing on your investment approach.

Investing in a fixed deposit remains your safest bet at the moment, because it has a fixed interest rate through the tenor, requires minimum investment and monitoring, and offers assured returns. But, why should you pick a fixed deposit and not any other instrument? Read on to find out.

The market is swaying

When you invest in market-linked securities, you want to be certain that you’re taking a calculated risk as opposed to entering the arena blindfolded. Unfortunately, currently the market is in flux. Nifty has gained 250 points whereas the BSE Sensex has crossed 850 points as of 20 May, 2019, owing to the exit poll predictions, but it’s important to remember that these predictions aren’t set in stone. Therefore, it’s best not to jump the gun. Instead, wait until the market stabilises post the election results and then consider investing in market-linked instruments.

Fixed deposit offers better returns

When you look at how various instruments performed in the year 2018, you’ll find that Fixed Deposit was the underdogs. While stocks offered a return of 2.7% and debt funds offered up to 5.9%, FDs maintained a lead with returns of around 6.5%. Given these numbers, it’s easy to see why investing in an FD should be right at the top of your list.

Fixed deposit counters multiple pain points

People who invest in the market have a few main concerns: uncertainty of returns, involvement required, and picking the right companies or avenues. When you opt for an FD, there’s no uncertainty of returns as the rate that the company has determined at the start of the tenor will remain fixed.

Moreover, since an FD’s growth has nothing to do with how the market performs, you know that you’ll get the money promised to you on maturity. Besides, picking the right FD is easy. You can you pick one from NBFCs, banks and other financial institutions, although those offered by NBFCs are superior owing to higher interest rates on offer. Besides, ratings given by agencies such as CRISIL and ICRA are good indicators of which FD is a safe bet.

For instance, Bajaj Finance Fixed Deposit offers amongst the best FD interest rates in the country. For a 36-month FD with interest payable at maturity you can earn 8.60% interest as a regular investor and 8.95% if you’re a senior citizen. Since it has the highest ratings by both CRISIL and ICRA, you know that your investment is absolutely secure. You can invest as little as 25,000 for a tenor of your choice and realise your goals in a risk-free manner.

Applying is easy too as all you have to do is fill out a form online to get started. Enter details such as your name, investment amount, tenor and interest payout frequency to invest right away.

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