Crypto vs Other Assets. Which is Better?

 

Money-making is an art. and, as an artist, you need to find the perfect skill to create wealth. 

As an  investor in 2021, your first step towards putting money in a specific financial instrument should be driven by research.

Investment Assets in 2021: How to Pick the Perfect Asset Class

Every financial investment has a simple objective. That is, to make money. How the instrument goes about achieving this objective is an entirely subjective attribute! 

Other asset classes in India include commodities, properties, cash, and bonds. By now, you must be aware of how asset classes are defined, and at this point, it is appropriate to address the elephant in the room, i.e., the cryptocurrency.

Is Crypto a Reliable Investment Asset?

Most certainly, as the crypto-space is loaded with possibilities when investment opportunities are concerned! While the high volatility makes it a  questionable for short-term trading.

                               

Different Investment Assets available in India

As an investor, your first instinct should be to diversify assets.

Here are some of the assets that a prospective investor can consider:

§  Digital Assets

§  Mutual Funds & ETFs

§  Bonds

§  Retirement Plans

§  Commodities

§  Digital Assets

Pros

ü  Massive wealth creator

ü  Choices galore

ü  Option to invest in NFT tokens 

ü  Allows you to ride the boom

Cons

x Volatile space

x Needs good levels of diligence

Stocks

Investing in both Indian and global stocks is like devoting funds to a particular organization while being upbeat about its growth potential. In terms of volatility, the crypto-space can only be rivaled by the stock market. However, investing in the stock market is a multifaceted opportunity, where you can put money in derivative options or create specialized index funds to diversify the same at an elementary level.

                                       

Pros

ü  High liquidity

ü  A wide number of possibilities

ü  Higher rate of return

Cons

x Prone to oversight

x Requires technical acumen to succeed

Bonds

Better termed as debt securities, bonds are more like lending money to corporations, municipalities, and governments for a fixed rate of return. Bonds are decent resources to diversify your portfolio.

                                     

Pros

ü  Fixed returns

ü  Lesser risk exposure

ü  Can be selected based on ratings

Cons

x Large investments are needed

x Low liquidity

 

Mutual Funds & ETFs

One of the more popular financial assets, Mutual funds and Exchange Traded funds(ETF), are more like fund pools, with the funds being used by fund managers to invest in specialized securities, bonds, or other assets. In simpler words, these funds take your money, pool them, make profits, and then pay you a part of it.

ü  Pros

Diversified investment asset

ü  Transparent

ü  Minimal risk

ü  Good liquidity

Cons

x Higher overheads

x Not fit for investors with a higher risk appetite

 

  If you want to actually grow the corpus and not restrict yourself to pocket change, you should be ready to embrace the Crypto future as early as possible