Advantage
Benefits of investing in equities as compared to other assets like real estate, gold, and fixed monetary assets:
- Digital Assets: Equities can be easily monitored and traded digitally from anywhere allowing investors to manage their portfolio conveniently through online platforms.
- Flexibility of Working Time: Investors have the flexibility to execute trades and manage their investments based on their preferred time and schedule without the constraints of a typical 9 to 5 job.
- Liquidity: Equities offer high liquidity, meaning investors can quickly convert their investments into cash at prevailing market prices when needed. Unlike real estate there is no bargain of prices or time delay in realization.
- Flexible Ticket Size: Investors can start investing in equities regardless of their investment capital. Unlike real estate there is no limitation of fixed ticket size. Investors have the flexibility to gradually increase or decrease their investment.
- Transparency: Equity markets operate in a transparent manner, with publicly available information about prevailing market prices, company performance, financial statements, and market trends, enabling informed investment decisions.
- No Dependence on People: Unlike real estate, equities do not require direct management or dependence on brokers and other individuals for generating returns.
- Option of Diversified Portfolio: Investing in equities allows for building a diversified portfolio across different sectors and companies, reducing risk through spreading investments and potentially increases returns.
- Ease of Doing Business: Investing in equities does not involve the complexities of property ownership like registration or the operational challenges of running a business. It offers a straightforward and efficient way to participate in the growth potential of companies.
- Tax Benifits: Equities offer tax advantages, such as lower tax rates on both short-term and long-term capital gains, potentially enhancing investment returns.
- Knowledge and Hard Work Pays: Investors who put in effort to research and analyse companies and market trends can potentially achieve higher returns in equities. The market rewards informed decisions and disciplined investment strategies.
- Highest Return over Time: Historically, equities have provided higher returns compared to other asset classes like real estate, gold or fixed monetary assets over the long term. Investing in well-managed companies with strong growth potential can generate significant wealth accumulation.
- No Entry & Exit Load: Unlike real estate, equities do not have an entry load like property registration fees or exit load like making charges in case of jewellery. Investors can quickly encash their assets at prevailing market price when required.
- Zero Carrying Cost: Unlike real estate, equities do not have carrying costs such as property taxes, maintenance costs or insurance premiums or storage fees for physical assets like gold. There are no expenses associated with holding or storing shares.
- Nuisance-Free Business: Investing in equities does not involve the hassle of managing physical properties dealing with issues like title disputes, family inheritance, joint ownership or maintenance problems.
- Safety against Theft, Illegal Occupation, etc.: Unlike physical assets such as real estate or gold, equities are not prone to risks like theft, cheating, illegal occupation, or damage. They exist in electronic form, reducing the vulnerability to physical threats.
- Industry of Professionals and Intellectuals: The equity market is a hub for professionals including analysts, brokers, fund managers and intellectuals who provide their expertise and valuable insights to make informed investment decisions.
It’s important to note that while equities offer numerous advantages, every investment carries its own set of risks and rewards. Investors should carefully assess their financial goals, risk tolerance and seek professional advice before making investment decisions.