It Equity Really Risky?

If I tell my parents to invest in equity, they will say NO. Why? it is risky. And I am sure most of us or atleast people from previous generation will definitely say that equity is RISKY so stay away from it. Well let me tell you that this is NOT the case today. You do not have to learn direct equity investing, Equity mutual fund will do all the job for you.

Those days have become history when our parents used to built wealth with fixed and safe investment products like Bank fixed deposit, PPF etc.

The average inflation rate of India in 2011 is 8.88 %. Now if you consider bank's saving account which provides 8% annual return. According to above data you are in loss of 0.88%. Hence today equity is the must have asset class in your portfolio. Equity is the only product which can beat inflation and built ample wealth in long run.

Professionals and experts (Fund manager) are there to manage your fund, you don’t have to worry all they will just charge you 1.5% annual charge. Mutual funds are also so cheap that they will charge 0% Entry load and 0% Exit load after 365 days of investing. If you stay invested for long term, over a period of time the volatility in equity reduces and it gives you excellent returns. Hence it is must to stay invested in equity for long time horizon.

Consider equity as a major asset class in your portfolio. Start investing early and stay invested for a long time horizon and see the power of equity.