It is not a surprise at all that things have gone a complete downhill ever since the impacts of the Covid-19. Countries have been on lockdown and the economy has come to a standstill ever since then. But, even with the imposed restrictions and the crisis at hand, it is extremely important to ensure that you do keep an eye out on certain investment factors before making any further investments at the moment. Not only do you need to save money at the moment, you need to be smart about your investments too.
Even though the world leaders across are working vehemently to not let the world economy collapse, it is not a surprise at all that the world is currently heading towards a state of recession that none of us can recover from right from the get go.
Look over the debt portfolio
Several NRIs have investments in debt funds. In case you are one of them, it is extremely important that you check for the fund type, credit ratings, assets under management and even the overall average yields. In case the securities of the debt funds are ranked under AAA, it is better that you steer clear off of it.
The experts are also suggesting to transfer the debt holdings from the risky funds to the safer ones including the liquid funds. The NRIs can also withdraw their money out from the risky funds at the moment and invest them on the 7.75 percent Savings (Taxable) Bonds. But, the one downside is that they can only be invested via a resident Indian, so you need to get a family member to do it for you.
According to the Fully Accessible Route introduced by RBI, it also allows the NRIs to invest in specific Government Securities. The average profit from these investments yield around 5-6%, which is not bad.
Diversify your investments
When it comes to the Indian stock market, the one thing that everyone has currently noticed is the volatility of things. It is thus extremely important for everyone to review and balance the investments. In case you want a sustainable result from the investment, it is important to opt for diversification.
Instead of investing your lumsum money in a single bond, it is important to spread it out via multiple channels, be it as equity, gold, cash or even debt. Aside from that, invest based on the geography where you know for a fact that the rate of growth would be high and promising. This is extremely important.
The geographic diversification is an extremely important to reduce the risks of a particular market and even optimise the growth of your funds for the better. But, in case you are indulging in global investments, it is important that you keep a look out on the income tax obligations.
Opt for staggered investments
The sudden stoppage of the economy has imposed risks to the Nifty and Sensex, bringing it down by 30%. But, one investment option that NRIs need to keep in check is with the equities. In case you are investing on equities, it is extremely important that you shift your funds to equities in a staggered manner.
In case you already have equity investments, it is important that you keep a check on the portfolio holdings and the book losses. Try and shift your investments to a large cap company instead of the high risk and small ones.
Another option for NRIs that stand out if they don’t want to go through the hassle is to opt for the ETFs or the Index Funds. They mirror the market performance and bring down the risks even on the low investment options.
Look over the insurance cover
Having an insurance cover for one’s own self and for their family is extremely important in such testing times. But, do you have adequate insurance cover. This is exactly what one does need to assess and look over without further questions.
Not just in your home country, it is extremely important to check that you do have adequate amount of insurance cover for yourself and your family in the country that you are currently staying in. In case you are planning on returning to India, it is better to invest in an insurance plan now instead of coming and get one and then waiting for it.
Real estate investments
With the sudden drop in the price of real estate, several NRIs have peakedinterest in the same. But, you need to be very cautious with the investments. It is likely for NRIs to have interest in real estate investments in case they want to return to India in the near future.
But, in case you now want to invest in some real estate in India, experts are suggesting to opt for the completed projects instead of the ongoing ones. The reason behind this is because the delay can further be deferred because of Covid-19 and the situation surrounding it.
With the real estate going through a rough patch at the moment, it is expected that even the rental markets will experience a hit of the same. So, if you want to buy a property and put it up for rent, that can pose a lot of trouble at the moment too.
Gold investments
Last but not the least include the gold investments. Gold investment is a good option during times of crisis, well, at least that is what they say around. But, just because the things surrounding gold seem favourable now, it is not likely that things will remain the same in the days to come as well.
This is the reason why you need to be cautious with your investments. Experts are suggesting to invest on gold ETFs instead of physical gold. In case you have family in India, ask them to invest on the Gold Sovereign Bonds for you. These yield good returns and are a good option.
In case you have been wondering about investments in such hard times of Covid-19, we would suggest you take every step with caution and assess the goods and bad before making any kind of final decision.
